OMAHA, Neb. The CEO and lone employee of the now-defunct H.B.E. CU was sentenced yesterday to 45 months in federal prison for stealing $636,000, much of it to go on shopping sprees, the latest case of a manager of a tiny credit union taking advantage of lax board oversight to loot the credit union’s coffers.
The embezzlement forced NCUA a year ago to shutter the $1 million credit union, which served employees of a housing contractor in nearby Seward, Nebraska.
Criminal charges of embezzlement causing the bankruptcy of a credit union have also been filed in recent months against the managers of Michigan’s United Catholic CU, Allied Tube Steel FCU in Illinois, Philadelphia’s People for People CDCU and Pennsylvania’s Lawrence County School Employees’ FCU.
Chrystal Lankford, 36, who headed the tiny H.B.E. CU for five years, told authorities she used the stolen funds to go on extravagant shopping sprees and to pay personal expenses.
She told authorities she wrote checks drawn on the credit union’s account at Union Bank and Trust to herself and her husband, Steve Lankford, without the approval or authorization of the credit union or its directors. She then deposited the money into her joint checking account with her husband, who also worked at H.B.E., but in the company’s plant, not the credit union.
When Lankford took over the tiny credit union it had a surplus of about $1 million and she left it with a $27 balance and $50,000 in overdraft fees.
