BURLINGTON, Vt. The former CEO of Border Lodge CU last week pleaded innocent to charges she embezzled “hundreds of thousands of dollars” from the tiny credit union run out of the CEO’s home that was seized by regulators in November.
Debra Kinney was released on bond by a federal judge, on conditions including that she not be arrested on any new criminal charges and that she possess no firearms.
Prosecutors say Kinney, 58, deposited credit union money into her personal account at Passumpsic Savings Bank, and also deposited money in an account for a close friend. Authorities have disclosed at least $300,000 they believe was embezzled.
A state examination showed $207,000 was taken from various member accounts from April 4, 2011, to July 12, 2012, and placed into an account maintained by Kinney’s friends. The FBI says Kinney also withdrew $79,108 from member accounts and placed in an account maintained by Kinney and her husband, James Kinney, from June 13, 2011, to June 6, 2012.
The FBI and state regulators closed down the $3-million credit union, located on the U.S./Canadian border town of Derby Line, during a court-ordered raid Nov. 30. The credit union offices were in the basement of Kinney’s home.
Border Lodge served employees of varied and approved occupational groups who work in Orleans County. Among these was Tivoly Inc., a machine tool company in Derby Line; Newport City Schools; Newport Ambulance; and the town of Derby.
