The Dirty Dozen: 12 Notorious Credit Union Heists
Over the years, the credit union industry has witnessed notorious fraud and embezzlement cases involving CEOs and their family members, credit union members, rank-and-file employees, labor union chiefs, computer consultants, lawyers, real estate investors, government workers and entrepreneurs.
While there has been a lot of credit union fraud cases of varying degrees, this list focuses on what Credit Union Times believes to be the worst of the worst cases, which we name the Dirty Dozen. The individuals involved in these infamous heists –many of whom are still in prison – stole a total of more than $185 million over the past 25 years.
Barnstable Community Federal Credit Union –$45 million In the 1980s, Richard Mangone became a legend in New England credit union circles, successfully building the Digital Employees’ Federal Credit Union from scratch and making it one of the most innovative credit unions in the nation in just three years. He also co-founded Barnstable Community Credit Union.
Today, Mangone is known as Inmate 19201-038 at the Ray Brook federal medium security facility in upstate New York, serving a 24-year prison sentence, one of the longest prison terms ever for a convicted white collar criminal.
Three Credit Unions and Jiffy Lube Stores – $16 million
Samuel Pearson of Hanover, Pa., operated a company called Peanut Oil, which leased and managed a number of Jiffy Lube franchises and other businesses in the Keystone State and throughout the U.S.
Municipal Credit Union— $15 million
This credit union heist is, well, particularly sad when you consider it involved 4,000 credit union members who siphoned $15 million from the $1.1 billion Municipal Credit Union’s ATM system during the mayhem, confusion and fear that followed the 9/11 terrorist attack in New York in 2001.
Broome County Teachers Federal Credit Union –$14 million
Laura Conarton worked as a loan administration manager at People’s National Bank for 10 years. What she learned in that job helped her and her son, Scott Lonzinski, scam and bankrupt the $52 million Broome County Teachers Federal Credit Union of Binghamton, N.Y., authorities allege.
Center Valley Federal Credit Union –$9 million
Bernie Metz was making around $60,000 a year at the now-defunct $17 million Center Valley Federal Credit Union in Wheeling, W. Va., yet she and her husband, Everett, were spending millions buying a restaurant and tavern, real estate, two Mercedes, and many other nice things for her, her husband and their children.
Texas Department of Transportation Credit Union – $3.1 million
Joanna Lynn McGee, an officer at the now defunct Texas Department of Transportation Credit Union of Wichita Falls, Texas, spent seven years attempting to cover up a complex fraudulent scheme that led to her arrest and ultimately the liquidation of the credit union in 2008.
Boeing Helicopters Credit Union – $2.54 million
Anthony Forte, former president of the United Aerospace Workers Local 1069, south of Philadelphia, maintained his innocence when he was indicted in 2008 with 154 counts for fraud and bribery.
N&W Poca Division Federal Credit Union – $2.4 million
Rebecca L. Poe and Pamela Mullins were employees of the N&W Poca Division Federal Credit Union in Bluefield, W. Va., where instead of helping the credit union make money, they were stealing from it for five years. They bilked $2.4 million from the credit union, which contributed to its collapse in 2008.
Borinquen Federal Credit Union – $2.3 million
When Ignacio Morales, former CEO of the failed $7 million Borinquen Federal Credit Union of Philadelphia, failed to appear in federal court on Aug. 28. 2012, to face charges that he embezzled $2.3 million from his own credit union, he had a good excuse: He was already in jail. He voluntarily surrendered to police on a bench warrant from a 2008 DUI charge and was placed in a Philadelphia prison after being found contempt of court.
Utah Credit Unions and Arizona Credit Union –$2 million
For two and half years, Zeldon Thomas Morris held a trusted, professional position as a computer systems consultant to install software upgrades on IT systems at four Utah credit unions.
Mayes County Federal Credit Union –$1.6 million
Cynthia Jan Harris stole so much money from Mayes County Federal Credit Union of Pryor, Okla. over seven years that she apparently lost count how much cash she pilfered.