Thank you for sharing!

Your article was successfully shared with the contacts you provided.

DECATUR, Ala. – The $181 million Family Security Credit Union said it will appeal a recent court award of $1 million to a former employee who claimed that previous credit union employees defamed her. “Family Security dismissed a former employee who took exception to her dismissal,” said Thomas Light, CEO of the credit union who took the reins of the institution after the incidents that make up the basis of the complaint. “The court agreed with her and the case will be appealed,” he said. Light took over the then troubled credit union in December 2000, in the wake of a scandal that involved credit union employees allegedly kiting checks and engaging in loan fraud. In its decision, the court agreed with Karen Brackin, the former vice president of the credit union and awarded her a total of $1 million in the case including $800,000 in compensatory damages and $200,000 in punitive damages. According to her lawyer, Birmingham-based Thomas Baddley Jr., in the course of an audit of the credit union Brackin discovered that several credit union employees were engaged in inappropriate, and it turned out later, criminal behavior. After she reported the behavior to the credit union leadership, Baddley said, the credit union employees allegedly involved in the activity in turn accused her. The credit union’s CEO, Ron Fields, then dismissed Brackin in December 1999, after the Alabama Credit Union League referred her alleged impropriety to the state regulator. Brackin, in turn, filed suit. Baddley pointed out that since then employees of another firm which had been involved in the scheme have been arrested, tried and sentenced to federal prison and the then CEO, Ron Fields, was asked to resign. “Essentially, what Karen did was correct and yet she had her name dragged through the mud about it,” Baddley said. “That is what we are suing over.” Baddley noted that two of the former credit union employees who had accused Brackin would not take questions about the matter in the suit, citing their Fifth Amendment right to not have to incriminate themselves. Fields is now CFO for the $554 million Pen Air Federal Credit Union based in Pensacola, Florida. He was unavailable to comment on the court’s decision. The original suit also named the Alabama Credit Union League and its vice president Jo Lynn Rutledge, the executive in charge of the League’s auditing program, but the judge in the case dismissed the charges against them. Baddley said that he planned to appeal the judge’s decision to dismiss the charges against the League and Rutledge. “When you think about it, what they did was every bit as reprehensible as what the credit union did,” Baddley said. “They took unverified statements, not taken under oath, to the state regulator and that in turned helped get Karen fired and blackened her name,” Baddley said. Rutledge said that the court had reviewed the league’s decisions and actions in the case and had determined it had done nothing wrong. She referred any other questions to Family Security’s lawyer, Birmingham attorney James Nolan. Nolan would not comment on any actions to reinstate Rutledge or the League to the case, but stated that the court had found that neither Rutledge nor the League had done anything wrong and had, in fact, been following the instructions of the Alabama regulator. “They have no liability at all in this case,” he said. [email protected]

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?


Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times
Live Chat

Copyright © 2022 ALM Media Properties, LLC. All Rights Reserved.