Would Lafayette FCU Have Been Able To Convert?
KENSINGTON -- Even if the $319 million Lafayette Federal Credit Union had prevailed in the controversy over its balloting in its 2006 attempt to change its charter to a mutual bank, there are reasons to doubt whether the credit union would have ever become a mutual bank without significantly changing its operations.
According to Lawrence Hart, the credit union's recently resigned Chief Compliance Officer, staff from the Office of Thrift Supervision's Atlanta Office told the credit union's leadership, in Hart's presence, in a meeting that was held in mid-August of 2006 that if the credit union had already been a thrift it would have been given a cease and desist order due to its Bank Secrecy Act violations.
Hart said OTS also advised the leaders to withdraw the CU's charter change application, fix its BSA problems, and then reapply.
The credit union has not commented on Hart's account of the meeting. NCUA has said only that it was aware of the credit union's contact with the OTS, but not of the nature of the contact.