Teller First One Convicted In Alleged Family CU Fraud
CHARLESTON, W.Va. – A former teller at defunct N&W Poca Division FCU, one of several family members charged in a $2.4 million fraud that sunk the one-time $7 million credit union, yesterday pleaded guilty to a single fraud count in connection with the scheme.
As part of the plea agreement Pamela Mullins, 46, stipulated to the facts of the scheme that started in about 2003 and continued through August 2008, culminating in the liquidation of the credit union.
Mullins and her cousin, Rebecca Poe, the 35-year-old assistant manager and daughter of the president Deborah Bailey, allegedly engaged in a variety of schemes authorities say may have drained as much as $5 million from the 40-year-old credit union.
Bailey has not been charged in the criminal case but is being sued by NCUA in connection with the alleged fraud. Also named in NCUA’s civil suit are Bailey’s husband, Poe’s husband and Mullins’ son.
The alleged family fraud wiped out the vast majority of the $7 million credit union’s assets and caused a loss of $5.5 million for the first three quarters of 2008, when it was shut down by NCUA.
In its civil suit, NCUA claims the group made fictitious deposits into their and family members’ accounts and made phony payments on loans they took out. The fictitious deposits scheme began small and grew steadily, according to NCUA, to as much as $14,000 a month in 2002. The suit also claims the credit union made hundreds of thousands of dollars in debits on behalf of the family members which were never posted to their accounts.
The credit union was chartered to serve employees of the Norfolk and Western Railway and later added employees of American Electric Power Co. (formerly Appalachian Power Co.) – N&W Poca.