LYNCHBURG, Va. Authorities are saying they have an admission from a former teller at the now defunct Lynrocten FCU here that she and the CU’s manager engaged in a 10-year-long scheme to defraud the credit union.
According to an affidavit filed in U.S. District Court here, the Secret Service is investigating what is being called “unusual activity” in accounts controlled by former manager Linda Susan Newcomb and former teller Teresa Humphries. Neither has been charged with any crime at this point. The $13.8-milion Lynrocten Federal was liquidated earlier this year.
A search warrant related to the credit union indicated that between $2 million and $3 million in fraud allegedly took place, with approximately 125 fake loans taken out in the names of actual members. Approximately 25 members have signed affidavits that they did not take out loans that are in their names, authorities said.
NCUA said it has already begun paying member deposits as part of the liquidation.
