The National Credit Union Administration's Office of the Inspector General (IG) issued a highly redacted Material Loss Review on the failure of El Paso's Federal Credit Union.
The IG report noted senior management displayed a lack of integrity and did not manage the credit union in the best interest of its members. The report pointed out that credit union's fee income was excessive. During the period examined, fee and other operating income as a percent of average total assets averaged 3.73 times higher than its peers.
The report stated that "senior management displayed a lack of competence and training appropriate to their position."
In addition, the credit union had deficiencies with regard to record keeping and internal controls and ineffective oversight by its Board of Directors and Supervisory Committee.
For example, "examiners found problems with the execution of loan collections and charge offs, the sufficiency of Board minutes, identification of delinquent loans, backdating of transactions, and the Credit Union's advertised field of membership."
The report also noted that the Board Chairman received questionable payments associated with Board meetings and expenses.
Read the report.
KL - have you ever seen a redacted MLR before? This seems very odd. Doesn't the public have a right to know what the OIG found?
ReplyDeleteWith the exception of Eastern New York FCU (which has a couple of lines redacted), I have not seen a redacted MLR.
ReplyDeleteFDIC's OIG reports are never redacted?
ReplyDelete