LYNCHBURG, Va. NCUA said this evening it shuttered $14 million Lynrocten FCU here, the year’s sixth credit union failure.
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The NCUA action comes as local police in the suburb of Washington D.C.have begun a criminal investigation into an alleged loan scheme at the credit union, which has not reported any losses and had strong capital at March 31.
Several members have told police that loans have been taken out in their names without their authorization.
NCUA said it made the decision to liquidate Lynrocten and discontinue operations after determining the credit union was insolvent and had no prospect for restoring viable operations.
The 77-year-old credit union served the employees of Rock-Tenn Company and had 1,068 members.
