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Industry experts say due diligence can help credit unions avoid losses like those suffered by the $620 million Alabama One Credit Union in Tuscaloosa, Ala., and the Small Business Administration, which were defrauded of more than $3 million by a businessman.

Danny Ray Butler allegedly engaged in a check-kiting scheme that led to a $1.275 million loss at Alabama One. He also allegedly defrauded the SBA of $1.76 million through a loan to build a grocery store, according to a 51-count indictment and statements made Oct. 4 by U.S. Attorney Joyce White and FBI Special Agent in Charge Richard D. Schwein Jr., in Birmingham, Ala.

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