DAVENPORT, Iowa – The Iowa Division of CUs said Friday it has taken over the Davenport Fire Department CU because of broad record-keeping deficiencies at the $10 million credit union. The state regulator said the deficiencies prevent them from determining the financial condition of the credit union.
The record-keeping problems stem from a 2006 installation of a new data processing system provided by Terra Firma Information of South Carolina. A lawsuit filed by the credit union against the data processor claims the company failed to provide general ledger and other required state and federal reports; did not charge ATM fees or interest correctly; did not properly balance accounts; and provided bad information to members on late and illegible statements that had confidential information written on the outside of the envelope.
The suit also claims that several members had their ATM cards "hot carded," or taken by ATM machines, shortly before Christmas 2006, documents state. Car loan payments were not documented correctly and had loan calculators that did not work properly. When the credit union informed Terra Firma it was ending their relationship, Terra Firma denied the credit union access to all member account information stored on its server, the suit alleges.
