Wednesday, August 29, 2012

Illinois CU Regulator Suspends CU Operations for 60 Days

The Director for the Division for Financial Institutions of the Department of Financial and Professional Regulation suspended for 60 days the operations of Bagumbayan CU, located in Chicago, Illinois.

The state credit union regulator found that the tiny Chicago-based credit union was in substantial non-compliance with the state’s credit union statute and was operated in the an unsafe and unsound manner.

According to the suspension order, the credit union had reported a loss in each of the last five years and its net worth had fallen by 36 percent over that time period.

The order also notes that the credit union failed to file annual report with the Department and failed to produce financial records during examinations.

The regulator found that the credit union failed to maintain a valid field of membership and added five individuals as members in May 2012, who were not part of its field of membership.

This is the third credit union to have its operations temporarily suspended by the Illinois CU regulator this year. The other two credit unions were USA One National Credit Union, which was closed by the regulator on May 31, and Branch 825 N.A.L.C. Credit Union, which was acquired by Corporate America Family Credit Union.

Read the suspension order.

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