Pentagon FCU Explores Conversion To Bank
ALEXANDRIA, Va.-Frustrated over the huge cost of the corporate credit union bailout, the board of Pentagon FCU has authorized management of the nation's third largest credit union to explore conversion to a mutual savings bank.
No decisions have been made yet, but the board agreed over the weekend to have management look into the savings bank charter, according to several sources.
Pentagon officials declined to confirm the reports. "I have no comment," Frank Pollack, president of the $13-billion credit union, told Credit Union Journal last week.
In an interview soon after NCUA announced plans to have natural person credit unions fund the $5-billion corporate bailout, Pollack called the estimated $80 million charge to his credit union "confiscatory" and said he will avidly explore every option to limit the cost to his members.
The $80-million charge for the corporate bailout would wipe out almost two-thirds of Pentagon's $125 million net income for 2008. The credit union giant had a banner year in 2008, with 16% growth in assets and a 1% return-on-average assets, or ROA.
Pentagon pulled out of the corporate system in 1995 after it lost $1 million on the failure of Capital Corporate FCU, the Washington-area corporate known as CapCorp.
CU Offers Special Adoption Loan
GLENDORA, Calif.-Couples who need help covering the cost of an adoption can now turn to America's Christian CU.
The $500-million credit union introduced its new adoption loan program that will help prospective parents cover the costs of travel, legal expenses, agency fees or any other cost related to adopting a child into their families.
Some of those costs can add up to $40,000 to the adoption process.
"We consider our new product, adoption loans, part of fulfilling our mission," Mendell Thompson, president of America's Christian, said. "We understand the unique nature of adoptions and want to offer adoptive parents our help and support as they build their family."
St. Mary's CU Donates $30,000
HUDSON, Mass.-St. Mary's CU has pledged to contribute $30,000 to Marlborough Hospital over the next three years. The donation, which will be used to help support Marlborough Hospital's general fund, makes St. Mary's CU the first business to renew its support of the hospital's "President's Circle," a group of local businesses and philanthropic leaders who are committed to supporting health care for community members.
Suspect Charged In $80K ID Theft
MECHANICSBURG, Penn.-One of two men charged last week in an attempted identify theft scam from Members 1st FCU was charged with stealing more than $80,000 from Members 1st in an earlier scheme.
Police said Derrick Sylvester, 35, used stolen ID information to obtain loans from three different Members 1st branches to purchase vehicles. Sylvester was charged with three counts of theft by deception and identity theft. Last week, Sylvester and Demond Faulkner, 35, were charged with identity theft in a scam to obtain a loan for $24,475 from the Middletown branch of Members 1st.
Man Scams, Scrams, Lands In Jail
BILLINGS, Mont.-A former Billings man who used a fake credit report to defraud two credit unions of about $37,000 will spend three years in federal prison on bank fraud charges. Thomas Cosand, 42, of Seattle, who had skipped his initial sentencing date and was arrested in Washington, was sentenced to 18 months consecutively on each count of bank fraud. Cosand was also ordered to pay $37,860 restitution, with $15,585 for Billings FCU and $22,275 for Avanta FCU.
Corrections & Clarifications
In the Feb. 16 edition of CU Journal, an article indicated Retail Employees CU closed three of its four branches due to restructuring at its sponsor, Macy's. The closures are unrelated to the action at Macy's, and the CU has no physical branches inside Macy's stores. Additionally, the CU is not acting on rumors related to other Macy's store closures.
