WASHINGTON — Even as they acknowledged that the credit union might never honor their request, members of the $319 million Lafayette Federal Credit Union have turned in their signatures seeking a special meeting at which the seven board members who voted to convert the credit union to a mutual bank could be recalled.

In a cover letter accompanying the petition, the members said they would accept the continued board service of Rodrigo Leiva and Darryl Pounds, two new board members who were appointed to fill out the terms of LeAnn Oliver and Drew Luten. Leiva is an organizer and activist in Washington, D.C.'s Hispanic community and Pounds is a former NFL player for the Washington Redskins.

Neither man was on the board when the conversion decision and its subsequent decisions were made. In fact, the members noted that neither had even been members of the credit union before being named to the board, a criticism the credit union's leadership has leveled at some of them who joined the credit union in 2006.

“They criticized me for not having joined until 2006 and here are two people on the board who weren't even credit union members until they joined the board,” said Thomas Carter, a credit union member from the U.S. Agency for International Development and one of the members who opposed the charter change and supported the petition.

Oliver and Luten resigned in January at about the time the credit union board was announcing the advent of lawsuits against its former CEO and his son, William Brooks and William Brooks Jr., for allegedly violating termination agreements with the CU in opposing the charter change. The litigation in the case is still ongoing.

Neither Oliver nor Luten commented on why they resigned from the board.

The members submitted the 821 signatures they collected to an unnamed Lafayette employee at the credit union's branch in the lower level of the Ronald Reagan building in Washington, D.C., the headquarters of USAID.

In many ways the delivery of the signatures felt anticlimactic after the work and organization the members had put into the petition effort. The members delivering the petition stood quietly in the branch, respectfully waiting for a Lafayette employee as though waiting to make a deposit or apply for a loan. The Lafayette employee who finally appeared from an interior office and accepted the petitions thanked the members for the envelope holding the documents, but appeared confused about what they were. “What do I do with them now,” she was heard to ask some of the members.

Afterwards the members trooped out of the branch and paused to talk to reporters who had witnessed the petition delivery. Under the credit union's bylaws, the petition needed to have at least 750 signatures. The members said they have 821 signatures of which they felt very secure.

After Lafayette Chairman Arnold Rosenthal wrote a letter to the membership suggesting that some of the signature gatherers had misrepresented the petition in an effort to get signers, the members supporting the petition put notices inviting signatories to contact them to have their signatures removed on all the Web sites where the petition had been promoted. The members said that, so far, no one had sought to have their signature removed.

One of the members on hand to present the petitions, but who did not come into the branch, was Scott Stein, the member whose ATM and checking privileges Lafayette had suspended after he had been collecting signatures for the petition in a branch. Stein said the CU had notified him by letter that his ATM and checking privileges had been restored after he complained about the suspension to NCUA. But since the letter had not said he was allowed to enter branches again, he had kept out of the branch. Friends, who are also members, drop things off for him in the branch, he explained.

The members said they have confidence in their petition, but acknowledged that it is unclear what may happen next. When members of the $1.7 billion DFCU Federal Credit Union petitioned for a similar meeting, the credit union refused to hold one, and there were indications in Rosenthal's letter that Lafayette may move in the same direction. As of press time, the credit union has not responded to questions about the petition.

The members on hand for the petition delivery did not consider it a coincidence that they were all employees of USAID. With its long history of supporting cooperative efforts overseas, many USAID employees are natural credit union members, the members said, a fact that has helped the credit union stay strong and grow, but which could hurt their special meeting effort because such a high percentage of them are regularly overseas.

“Clearly the credit union should have known that members from USAID were going to be among its most loyal members,” noted Edward Lijewski, a longtime USAID employee and credit union member. “And now they do–much to their regret.”

Under NCUA regulations, the credit union now has 30 days from the receipt of the petition on March 20 to set a date and location for a special meeting and to notify members. –dmorrison@cutimes.com

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Lafayette Members Formally Request Special Meeting to Recall Directors

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