Legal issues and news

Amid huge regulatory pressure to strengthen anti-money-laundering controls, banks are grappling with a shortage of compliance talent.

WASHINGTON — Federal regulators on Tuesday released the latest guidebook for examiners to use in assessing banks' anti-money-laundering programs.

MONTGOMERY, Ala. – An Alabama man was arrested and charged yesterday with filing dozens of phony federal income tax returns and hiring accomplices to deposit more than $200,000 of proceeds into accounts at Alabama Telco CU and a local bank, Community Bank & Trust.

NEWARK, N.J. – The estate for U.S. Mortgage Corp. and its CU National Mortgage subsidiary paid 26 credit unions and Fannie Mae an initial distribution of $8 million last week, repayment for losses accrued in the $140 million fraud engineered by company founder Michael McGrath, with additional payments expected.

HOUSTON, Texas -- The former CEO of Deer Park FCU was sentenced to six years in state jail for stealing almost $220,000 from the credit union.

NEW ORLEANS – A federal appeals court this week overturned a lower court ruling and remanded an appeal by four credit unions and three banks who sued Heartland Payments System for a massive 2008 data breach that exposed millions of credit union and bank cardholders to fraudulent transactions.

BALTIMORE—Five men, including the 48-year-old planner and his 20-year-old son who drove the getaway car, pleaded guilty to a June 2012 hold-up of an armored truck at Navy FCU when $220,000 was stolen in metro Washington, D.C.

CINCINNATI – The woman who created a credit counseling program at CinFed FCU was sentenced today to a year in prison for stealing as much as $400,000 from financially ailing credit union members she was supposed to be helping to trim their debts.

LUBBOCK, Texas – A former assistant accountant at a WesTex FCU branch was sentenced Friday to 37 months in prison and ordered to pay $690,000 restitution for a three-year embezzlement scheme.

ALEXANDRIA, Va. – NCUA said Rick Metsger will be sworn in and join its Board on Aug. 23 in a private ceremony on Capitol Hill with NCUA General Counsel Michael McKenna presiding.

NORFOLK, Va. – Five individuals were arrested Friday and charged with accessing information of people who had applied for housing at a Norfolk apartment complex to siphon almost $90,000 from the victim’s Navy FCU accounts.

KANSAS CITY, Mo. – The former manager of the Veterans Administration branch of The Credit Union of Leavenworth was sentenced to 21 months in prison and ordered to pay almost $330,000 restitution for stealing funds from members she had personally befriended.

SANTA ROSA, Calif. – Redwood CU has cancelled 18,400 debit cards in the face of an apparent hacking into the database of Raley’s supermarket chain that has led to fraud on as many as 200 of its member accounts.

MADISON, Wis. – A former commercial loan officer at Consumers CU in Round Lake Beach, Ill, and at Fox River State Bank in Wisconsin, was sentenced in federal court yesterday to 35 months in prison for a loan scheme that siphoned almost $1.5 million from the two institutions.

YUMA, Ariz. – NCUA filed a civil suit yesterday against one of the borrowers in the AEA FCU member business loan fraud, seeking more than $9 million on unpaid loans.

PITTSFIELD. Mass. -- A former teller at Greylock FCU was sentenced yesterday to three years behind bars for stealing $200,000 from the credit union.

ALEXANDRIA, Va. – NCUA this afternoon barred from credit unions a former teller at Cinco Family Financial Center CU who stole more than $600,000 from the credit union over nine years in bundles of $100s she disguised by stuffing the middle with $1s.

HOUSTON – The former vice president of lending at Members Choice CU pleaded guilty yesterday to creating $340,000 of loans in unwitting members’ names that he used to pay his credit card bills, his taxes, and for home improvements, among other things.

CASA GRANDE, Ariz. – An accounting clerk at Pinal County FCU has agreed to plead guilty to embezzling $781,000 by sending unauthorized checks to her mother’s Wells Fargo account.

FRESNO, Calif. – A federal court yesterday granted CUMIS Insurance Society a default judgment of $182,900 against a former teller at Educational Employees CU who stole credit union funds by approving 56 signature loans to family and friends.