SPRINGFIELD, Mass. -- The federal grand jury trial of former D. Edward Wells president/CEO Carol Aranjo and her husband, Alphonso Smith for conspiracy, tax evasion and embezzlement that led to the liquidation of the CU continued here last week.
According to a report in The Republican, former CU Board Member William H. Zachery Jr. told the jury that loan files were missing when he conducted an audit. Among the missing files were Aranjo's mortgage, loan documents in her two sons' names, and a loan to a former fraternity brother of board member Michael Akers, Zachery testified. Others loan files were incomplete, lacking application forms and other paperwork, he said.
An NCUA official testified that Aranjo had a $150,000 negative balance in her accounts and a $30,000 shortfall in her husband's by 2000, the same year the credit union suffered a $225,000 operating loss, The Republican stated.
Assistant U.S. Attorney Karen L. Goodwin said that a $2 million insurance settlement with inner city communities provided the means for Aranjo to addle elder board members who paid little attention to financial details and forestall discovery of missing funds. The NCUA conserved the CU in 2003.
"I didn't care to read a lot of business things," said Elizabeth Bryant, 80, a retired day-care teacher who served as board president in the late 1990s. "I was supposed to, but I didn't." Bryant did notice how previously amicable relations with the federal regulator had turned nasty, however. In 2000, Aranjo forbade examiners access to records and filed a restraining order.
The trial is expected to last for several more weeks. If convicted, Aranjo faces 14 years in prison.
--cburger@cutimes.com
