The aftermath of a 2013 scandal that saw top executives at the $603 million Alabama One Credit Union temporarily suspended from their positions has spilled over to this year's board election.
Jerry Logan, a former board member when Alabama One was the BF Goodrich Federal Credit Union, collected enough signatures to qualify to run.
His name will be added to the ballot that will be mailed to the members.
Alabama One's annual meeting is scheduled for March 28 at the Bryant Conference Center on the University of Alabama campus in Tuscaloosa, where the credit union is headquartered.
Logan's name will join those of three board-approved incumbents up for re-election: Larry Sexton, Richard Powell and Danny Harrell.
Logan served on the board and supervisory committee for the old BF Goodrich FCU for roughly six years, from 1998 until 2004.
He resigned in 2004, he explained, over the board's decision to change the name from BF Goodrich to the Credit Union of Alabama.
The board would later revisit that decision after being sued by the $654 million Alabama Credit Union, also based in Tuscaloosa.
“I resigned from the board because there was just no reason to make the change,” Logan said. “People don't understand that these name changes are expensive and there was just no reason to do that.”
Logan said friends urged him to run again for the board in 2004, but he lost. In 2006, he tried again but the credit union rejected his candidacy for insufficient signatures.
“In my heart of hearts, I always thought those signatures were valid, but they ruled they weren't and what could I do,” Logan said.
This year, with the help of friends, Logan collected 592 signatures, almost 100 more than the 500 required.
“It was hard to collect signatures, no kidding,” Logan said. “I was outside of that BF Goodrich plant, in the rain and cold at every shift change to get it done.”
Alabama One did not return calls for comment on the contested ballot by press time.
Logan said he wanted to make sure he collected more than enough signatures because Lorrain Ramos-Baird, another member and former Alabama One employee, had been expelled from the credit union after it became known she was running for the board.
Ramos-Baird did not return calls for comment, but a law firm representing her in litigation with the credit union confirmed her expulsion. Alabama One did not cite a reason for its decision when it notified her that she was no longer a credit union member, according to the litigation.
Logan's determination to run for the board arose after the credit union's 2014 annual meeting when he and other members tried to ask questions about the credit union's dealings with Danny Ray Butler, a local business owner.
A federal grand jury indicted Butler for fraud and check kiting in October 2013 and the Alabama Credit Union Administration suspended four credit union employees in late February 2014 in connection with an investigation.
The ACUA reversed the suspensions in the second half of March 2014.
Butler, who pleaded guilty to fraud and check kiting in July 2014, received a sentence of three years in federal prison and restitution. His actions cost Alabama One $1.2 million and the SBA more than $3 million in losses.
In addition, the credit union has faced a series of lawsuits from members who alleged credit union representatives played a role in getting them to invest with Butler. As of press time, two of the original five had settled with confidentiality agreements in places, but three are still pending.
“We just need to see some transparency about all this,” Logan said. “One lawsuit is too many and five is just awful.”
Logan said he and other members are also upset that Alabama One saw negative income this year of $7.82 million, according to NCUA data.
The credit union's equity ratio dropped from 11.59% to 10.40% and its reserves shrank from more $65.6 million at the close of 2013 to $60.5 million in 2014.
“We are supposed to be democratically run and member owned,” Logan said. “When they wouldn't even let us ask questions at the meeting, I decided I had to run for the board again.”
Alabama One has not returned calls for comment about the negative income and shrinking equity. John Dee Carruth, the credit union's CEO, addressed the lack of questions at the annual meeting in a previous interview with CU Times.
“We get about that many people every year and the credit union followed the procedure that it always follows,” he said in March 2014.
“It appeared that allies of the plaintiffs were trying to use the annual meeting for an improper purpose and to score points that they thought might increase pressure on the credit union to pay the plaintiffs money. An overwhelming vote of the members present rejected that attempt. Members have numerous opportunities to give the credit union feedback and express their concerns. Anyone complaining knows that,” he continued.
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:
- Breaking credit union news and analysis, on-site and via our newsletters and custom alerts
- Weekly Shared Accounts podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the commercial real estate and financial advisory markets on our other ALM sites, GlobeSt.com and ThinkAdvisor.com
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.