SPRINGFIELD, Mass. - A federal judge ruled that Carol Aranjo, former president of now-defunct D. Edward Wells FCU, could receive more than 12 years in prison on Sept. 15–the day she is scheduled to be sentenced for embezzling $1.5 million from the one-time prominent community development CU.
Under federal guidelines, Aranjo’s sentence could range from 10 years and one month to 12 years and seven months, after she was convicted in March of 44 charges, including embezzlement, conspiracy to embezzle, bank fraud and filing false tax returns.
Aranjo’s husband, Alphonso Smith, who was convicted of 10 charges, faces a possible sentence of two years and three months to two years and nine months.
In establishing the sentencing range, U.S. District Judge Michael Ponsor considered such factors as the amount of loss, abuse of trust, and to what extent the conduct of the defendants jeopardized the viability of the credit union. Ponsor concluded Smith was responsible for between $200,000 and $400,000 in credit union losses.
Aranjo rose to national prominence during the early days of the Clinton administration when she served as chairman of the National Federation of CDCUs, which played a key role in creation of the national Community Development Financial Institutions program. The jury found her guilty of lending out more than $2 million to friends and family members, much of it which was never repaid.
The credit union was established in the basement of a church in 1959 to serve poor minorities living in Mason Square and grew to more than $7 million, while establishing a model youth credit union program. The institution eventually was shuttered in 2003 by NCUA which ruled it insolvent because of the loans.(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com http://www.sourcemedia.com
