Fraud Losses Erase All Capital At Arizona's AEA FCU
YUMA, Ariz. — NCUA said this morning the growing losses related to the massive member business loan fraud at AEA FCU erased all capital at the one-time $410 million credit union and forced it to report a $31 million loss for 2010.
The one-time Arizona Education Association credit union was taken over by NCUA in December after its former business loan director, William Liddle and his wife, were indicated by a federal grand jury on charges of making millions of dollars in risky MBLs in exchange for more than $1 million in kickbacks.
The losses on the loans, put at almost $60 million, has pushed the credit union deep into the red for each of the past two years, including a $26 million loss for 2009.
AEA is one of several large credit unions currently being run under NCUA conservatorship, including California's Arrowhead Central CU, Key West, Florida's Keys FCU and Family First FCU in Utah.