CDCU Fraud Figure Still Missing

CHICOPEE, Mass. – Police and firefighters continue to search the surging Chicopee River yesterday for the body of local contractor Douglas Smith, but hope was fading they would find Smith, charged with his mother Carol Aranjo in a massive fraud that sunk prominent community development credit unions D. Edward Wells FCU. “At this point, if in fact he went in, I’m sure he perished,” said Chicopee Police Capt. Bill Jebb yesterday, of questions whether the apparent drowning was staged by Smith to evade prosecution. Smith has been missing since Sunday morning when he was reported to have taken a neighbor’s canoe into the rain-swollen waters to retrieve his own canoe. Police Capt. Jebb told The Credit Union Journal it is not unusual for people to drown in the river, especially during times of accelerated flow. “Unfortunately, it happens all too often,” he said, recalling a burglar chased into the river by police who disappeared under water and was never found. Authorities are not pursuing the possibility that the accident was faked to let Smith escape justice. “We’re going to go under the assumption that in fact he went in,” said Jebb. The apparent accident occurred just days before Smith was scheduled to appear in court on federal charges of embezzlement and fraud in connection with the looting of the once-prominent CDCU. Prosecutors charged that Smith accepted illegal loans that he never repaid from the credit union, which was run by his mother, and filed false tax forms to cover the scheme. He was among dozens of friends and family members, including Aranjo’s husband Alphonso Smith and two other sons, charged with accepting illegal funds from the now-defunct credit union. Carol Aranjo rose to become the leading spokesman for CDCUs as chairman of the National Federation of CDCUs, and testified before Congress on their behalf.