The $8.1 million Vensure Federal Credit Union, the Arizonacredit union that  at one time made most of its money byprocessing transactions for Internet poker sites, is no more.

The NCUA announced it has liquidated the Mesa-based credit unionon July 11, the same day a court case the CU brought to prevent aliquidation seemed to be drawing to a close.

“NCUA made the decision to close Vensure FCU and discontinue itsoperation after determining the credit union was insolvent and hasno prospects for restoring viable operations” the agency announced,adding that at the time of liquidation the credit union served 140members and had deposits of approximately $8.1 million. The agencyhad conserved Vensure on April 15.

But the one-page announcement failed to convey the complexitybehind the closing chapter in what had been one of the oddest credit union histories on record.

Vensure began its life in 1955, far from the Arizona desert, asthe Greater Adirondack Federal Credit Union in upstate New York. Atthe time, the field of membership had been members of a fraternallodge that had gradually failed, according to NCUA spokesman ToddHarper.

“As the field of membership shrank, the credit union, inessence, risked becoming defunct. Consistent with NCUA's policies,the board of directors of Grand Adirondack then applied for andreceived a new field of membership to serve the members of VensureEmployer Services in Mesa, Ariz., and the company's subsidiaries,”Harper explained in the days immediately after the agency firsttook over Vensure.

In fact, as court documents later showed, the story of howGreater Adirondack of upper New York State became Vensure of Mesawas a little more complicated.

According to NCUA filings in a court case Vensure brought tocontest its liquidation, some of which were redacted, the smallcredit union that had first popped up on the agency's radar when anorganization in New York City, the National Investors FinancialEducation Association, applied for credit union services throughGAFCU in 2008. Then, after the CU was granted permission to add thenew field or membership, it appeared to almost drop off the map,according to the agency.

“NCUA was completely unaware of any intended move by GAFCU andcaught off guard by the news because not only did GAFCU fail toconvey its intention before it moved, it also elected not to notifyNCUA first after it moved,” the agency said in its filing.

Then ensued, according to NCUA, an almost comic search aroundthe country for the true location of the CU. As part of the search,the agency recounted that its staff phoned or visited locations inNew York, Florida and Texas before they finally caught up withGAFCU, now headquartered in the small Arizona town of Gilbert.

By this time the CU, which the agency said previously had called“self-liquidating,” had increased its assets to $2.1 million.Its balance sheet swelled with fee and other operatingincome from two CUSO's: Account Process Systems and Verartis Inc.,which offered financial transaction and financial counselingservices.

But by the time GAFCU applied for and received permission tochange its name to Vensure FCU, the NCUA said it had learned that the income had not come fromtransaction processing or financial counseling but from the“legally suspect source” of processing transactions for Internetpoker sites.

The NCUA moved to conserve the credit union came after the ownerof its largest deposit account, the Trinity Global Commerce Corp.,was seized by the government as part of a crackdown and closure ofmajor online poker sites. Then Vensure sued the agency to fight theconservatorship and liquidation.

The question over the legality of online poker and transactingpayments for online poker largely muddled the court proceedings,with the CU arguing that it had provided the agency with many legalopinions justifying the legality of processing online pokertransactions and that it had complied with the agency's order tocease and desist from them. The agency countered that it had notdone so fast enough and remained at risk.

In the end U.S. District Court Judge Rosemary Collyer appearedto side firmly with the agency, showing as revealed in a redactedNCUA filing, that she had sided with the agency.

“The business model collapsed in a heartbeat [after theseizure],” the NCUA quoted Collyer as saying from the bench. “Sincethere were inevitably and always empty returns as I've labeledthem, meaning money handling that came back with insufficientfunds, Vensure was left with the obligation to pay up on those andno access to Trinity monies, exactly the risk foreseen by NCUA andnot previously experienced by Vensure,” the agency quoted Collyeras adding.

In the end, the court case appeared to end much as the CU did,with a whimper more than a bang. The courts final orders on recordas of press time, are for both sides to submit versions of an orderthe court can publish publicly because so much of the orderprepared so far has had to be redacted.