Scandal Figure Seeks Reinstatement To LawPractice

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HYANNIS, Mass. - (02/13/06) – A central figure in the early1990's fraud at Barnstable Community FCU, one of the biggest creditunion scandals ever, has reemerged as he seeks to regain hislicense to practice law. Michael O’Neil, one of threeco-founders of Barnstable Community FCU, served three years inprison for his role in the multi-million real estate fraud thatcaused almost $50 million in losses and sunk the credit union.O’Neil, along with Barnstable Community President RichardMangone and James Smith were convicted of a scheme to use thecredit union to finance Cape Cod real estate loans at inflatedappraisals, which was uncovered when the 1980's real estate bubblein New England burst. Mangone, who was sentenced to 24 years, andSmith, sentenced to 15 years, are still prison. O’Neil serveda 37-month sentence and was disbarred from the Massachusetts Bar.In petitioning the state Board of Bar Overseers, O’Neil saidhis disbarment was not directly related to the conduct of his lawpractice. In the Barnstable case, O’Neill, who served on theboard, including several years as chairman, fraudulently obtained21 real estate loans by taking them out in other people’snames, and faked minutes of the board meetings to conceal theloans. In some case, O’Neil used his firm’s accounts totransfer illegally borrowed funds to himself andco-conspirators.

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