Embezzlement and racketeering charges against a 61-year-old woman who stole $2.1 million from a shuttered credit union put the Michigan Credit Union League on the defensive Saturday, prompting a release that reassured consumers credit unions safe, secure and federally insured.
Michigan Attorney General Bill Schuette announced the charges against long-time manager Sharon Broadway Thursday, following the Aug. 9 liquidation of the $303,261 United Catholic Credit Union of Temperance, Michigan.
Schuette said Broadway had been using aliases and forged checks to embezzle funds for more than 20 years, and had also pocketed certificates of deposit rather than apply them to the credit union’s financials. A routine examination revealed the fraud.
“Members of credit unions across Michigan should rest assured that their money is safe and sound, and that credit unions are well-run, sophisticated financial institutions that typically have adequate checks and balances to avoid this type of event,” said league CEO David Adams. “Credit unions and regulators go to great lengths to ensure that proper safeguards are in place so our members’ money is safe. Our association stands ready to assist authorities in any way we can to get to the bottom of this incident, which is an aberration, and to ensure that it doesn’t happen again.”
A federally insured, state-chartered credit union, UCCU was chartered in 1961, operated just one branch with Broadway as the sole employee, and served more than 200 members belonging to Catholic parishes along Michigan’s border with Ohio.
Adams called the incident “extremely isolated” and added that fraud risk is inherent in any business.
“The framework and the very nature of credit unions mitigates that risk significantly,” he said. “Credit unions offer deposit insurance and other insurance protections, strong regulatory supervision by state and federal agencies and strong oversight by the institutions' boards themselves. Credit unions have an impeccable and trustworthy record as stewards of consumers' savings and investments.”