NCUA Orders DFCU Supervisors To Investigate Member Claims

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DEARBORN, Mich. - DFCU Financial's Supervisory Committee has been asked by the NCUA to investigate two members' complaint alleging bylaw and election procedure violations related to the upcoming board elections.

In a letter addressed to DFCU's Supervisory Committee Chairperson, NCUA Region I Director Mark Treichel gave the committee until Feb. 12, to provide his office and the complainant with a copy of its response and the results of its investigation.

During a DFCU Owners United candidate's forum DFCU member and CU Development Educator Eric Gubka told an audience of about 70 members that he sent a letter to NCUA after learning that three petition candidates have been denied information regarding the election process.

"These candidates have asked simple questions regarding the election process including a request to review the ballot before it was mailed out, a request to draw lots for placement of names on the mail ballot (as required by the bylaws), a request to be informed of who is auditing and certifying the election," his letter stated. "...Can DFCU get away with anything?"

Linda Malec, petition candidate and former DFCU board chairman, sent a separate letter to Treichel charging similar allegations.

Malec told the CU Journal that the response she received from Treichel was "very hands-off."

Treichel stated, in part, "You state that the credit union has violated its bylaws and you ask that I act. It is NCUA's longstanding position that the bylaws function as a contract between the credit union and its members. NCUA is not an arbiter. It does not get involved in bylaw disputes unless they involve safety and soundness issues."

Malec said she was not confident in the supervisory committee's ability to be impartial, considering its chairman is Harold Lowman, former board chairman and one of the original defendants in a lawsuit against DFCU that alleges bylaw violations.

"This is certainly not the NCUA I remember from years past who acted on matters of much less consequence than we are experiencing," Malec said.

DFCU and some of its members are already embroiled in a separate legal battle over alleged bylaw violations concerning a special meeting to recall board members associated with last year's conversion plan. While the plan was scrapped, several members sued their CU after it refused to follow its own bylaws that allow for the special meeting, and the NCUA refused to become involved. The fate of their suit is now in the hands of a Wayne County Circuit Court Judge.

Unfortunately, Gubka and others pointed out, time is running short. Election votes must be received by Feb. 9 either by mail, Internet or phone. Results will be announced during DFCU's annual meeting on Feb. 15.

The $1.8-billion DFCU Financial has endorsed three incumbents and is heavily promoting them on its website and allegedly through other means. Three additional candidates endorsed by DFCU Owners United earned spots on the ballot by petition in accordance with the CU's bylaws. They have not been acknowledged in DFCU campaign literature, and two who attempted to campaign on CU property in recent weeks were forced to leave the grounds (a fourth candidate, whose request to be removed from the ballot in late December was denied because he failed to put it in writing, is not actively campaigning).

"I appreciate the fact that this is a very sensitive issue, with one of the nation's largest credit unions (your organization does protect and insure our funds)," Gubka wrote. "However, it is way beyond time that the NCUA act in the best interests of its members."

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