One-Time CDCU Figure Banned From CUs
ALEXANDRIA, Va. – NCUA said this afternoon it has barred from the credit union industry Carol Aranjo, the former chairman of the National Federation of Community Development CUs who was convicted of embezzling as much as $2 million from D. Edward Wells FCU, the now-defunct CDCU she once headed.
Aranjo and her husband, Alonzo Smith, were sentenced to prison for siphoning funds from the Springfield, Mass., credit union by making loans to family members and friends from the one-time $9 million CDCU, which was liquidated by NCUA in 2003. Their son, Douglas Smith, a local businessman, also was charged with obtaining fraudulent loans but died in a freak boating accident as the case was proceeding to trial.
The failure cost the National CU Share Insurance Fund $5 million of losses.
Aranjo emerged as the leading spokesman for CDCUs as chair of the National Federation in the early 1990's and she testified several times before Congress as it was creating the Community Development Financial Institutions grant program, which the Federation was instrumental in developing.
NCUA also said it banned Donna Gainer, former employee of Tinker FCU for stealing $33,000 from the Oklahoma credit union.