Friday, May 17, 2019

Municipal Credit Union Conserved

The New York State Department of Financial Services (DFS) on May 17th took possession of Municipal Credit Union (MCU), located in New York City, and appointed the National Credit Union Administration (NCUA) as conservator.

“DFS is taking possession of MCU and appointing the NCUA as conservator in order to continue the close joint DFS/NCUA monitoring of the credit union’s condition, operations, and controls, to ensure that member funds are protected and that member services continue without interruption,” Acting Superintendent Lacewell said.

In 2017 DFS had uncovered deficiencies in board oversight that had facilitated the multi-million-dollar embezzlement by the former CEO, Kam Wong. Wong was charged by the Manhattan U.S. Attorney with embezzlement and banned from the credit union industry by the NCUA in May 2018. He pleaded guilty to embezzling nearly $10 million from MCU in November 2018.

The Department removed MCU’s Supervisory Committee in May 2018, and its board of directors in June 2018 due to severe deficiencies in their oversight of the over-all management of the affairs of the credit union and designated an on-premises Administrator to oversee the general management of the credit union. Based on ongoing supervision by DFS and NCUA, DFS made the decision today to appoint NCUA as conservator and terminate the Administrator’s engagement.

Municipal Credit Union has more than $3 billion in assets.

Read DFS press release.

Read the NCUA press release.
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