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HARTFORD, Conn. – Connecticut Commissioner of Banking John Burke had the power of the Connecticut General Statutes to back him up and he used it in meting out a penalty against Corporate America Family CU, Elgin, Illinois for opening a branch and expanding its field-of-membership in Connecticut without obtaining Burke’s approval, as mandated by state law. According to information provided to Credit Union Times, Burke and Corporate America entered into a Settlement Agreement whereby: * Corporate America Family CU has to pay a $15,000 civil penalty; * the credit union is prohibited for a period of one year following the execution of the settlement agreement from establishing any additional branches or adding any new select employee groups to its field of membership in Connecticut; * after the one year period, Corporate America Family CU may not establish any additional branches or add any new SEGs in Connecticut without the prior written approval of the Commissioner; At press time, Commissioner of Banking spokesman Dave Tedeschi said the $15,000 fine had been paid. Tedeschi emphasized that, “The Commissioner’s principle objective was to provide some sort of penalty to Corporate America Family Credit Union without impacting public convenience at the service level. It was very important to Commissioner Burke that the credit union, not its members, should be penalized.” As previously reported in the June 19th issue of Credit Union Times, CAFCU President Richard Wellner accepted responsibility for illegally doing business in Connecticut since 1997 and expanding the credit union’s FOM in the state without first receiving the mandatory authorization from Burke. CAFCU did receive approval from the Illinois Credit Union Supervisor’s office to expand its FOM out-of-state. CAFCU currently has one branch in Connecticut in the city of Bristol, and it has 134 SEGs, 101 which it adopted when it merged with the former Bristol Group FCU. According to the terms of the agreement, CAFCU can continue to operate its Bristol branch and keep its current 134 SEGs. In June, Burke served CAFCU with a Notice of Intent to Issue Order to Cease and Desist, a Notice of Intent to Impose Civil Penalty, and Notice of Right to Hearing. By agreeing to the Settlement Agreement, Corporate America “agrees to waive any rights to a hearing based upon the allegations contained in the Notice, and waives the right to seek judicial review or otherwise challenge or contest the validity” of the Agreement. Likewise, Commissioner Burke agrees “not to take any future enforcement action against Corporate America based upon the allegations contained in the Notice.” -

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