Police were dredging the swollen Chicopee River last week in search of Douglas Smith, a local businessman who was awaiting trial with his mother Carol Aranjo, the well-known community development credit union activist, and his father, on federal charges they siphoned millions of dollars from the accounts of D. Edward Wells FCU.
But after three days, hope had faded that the 46-year-old Smith, one of three of Aranjo sons charged in an 86-count federal indictment, would be found alive.
"At this point, if in fact he went in, I'm sure he perished," said Chicopee Police Capt. Bill Jebb last week, of questions whether the apparent drowning was staged by Smith to evade prosecution.
Smith was identified as the man whose canoe capsized in the river on Nov. 26.
Police Capt. Jebb said 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 underwater and hose body 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 canoe was found above the Chicopee Falls dam but Smith was not located after an exhaustive search by local police and fire departments, and the help of a State Police helicopter.
The apparent drowning occurred just days before Smith was scheduled to appear in court on 13 counts of embezzlement, filing false tax returns and filing false statements on federal documents, in connection with loans the credit union made to his company, D.A.T. Construction.
Officials with the U.S. Attorney's office, which is prosecuting the case would not comment on the apparent drowning.
Prosecutors charged that Smith accepted illegal loans 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.
Last month, Mary Spruell, a 67-year-old community activist and close friend of Aranjo, pleaded guilty to charges in connection to $109,000 in credit union loans Aranjo forgave. Spruell was an officer of Friends of the CU, a non-profit group run by the credit union, through which as much as $2 million of credit union funds is believed to have been laundered.
Aranjo, 67, rose to become the leading spokesperson for CDCUs as chairman of the National Federation of CDCUs. She testified before Congress that federal agencies should make deposits in CDCUs to help spur community development.
She was eventually removed from the CDCU Federation's Board after a fight with other board members and executive director Cliff Rosenthal.
NCUA shut down the 54-year-old D. Edward Wells FCU in 2003 after fighting Aranjo for several years for full access to the books. Though the books showed it had almost $9 million, NCUA came up more than $5 million short.
The credit union was then merged into Western Massachusetts Telephone Workers FCU.
