Conflict Forces Director Out
ALEXANDRIA, Va. – A ruling by NCUA that a director with financial interests in a credit union vendor was in violation of the agency’s conflict of interest rule forced the director to resign from the board. NCUA said in legal opinion to First Community FCU, that a director who owned the credit union’s indirect loan vendor and brokered insurance deals with the credit union was in violation of the agency’s rules. “He was getting money from every indirect loan that we did,” said Cheryl DeBoer, president of the $270 million credit union. The director, who DeBoer would not identify, resigned last May, just after NCUA issued its legal opinion. In its opinion, made public yesterday, NCUA said the purpose of the conflict of interest rule its to ensure that no officer or director of a federal credit union is influenced in his duties on behalf of the credit union by the potential for personal financial gain. The director, according to NCUA, not only owned interest in a company that provides indirect lending services for Parchmont, Mich., credit union, but also in a separate company that brokers insurance products to the credit union. The former director’s companies continue to do business with the credit union.