GALVESTON, Texas (CN) – The manager of a credit union drove it out of business by stealing $466,000 from member accounts for herself and her family, the liquidator claims in court.
The National Credit Union Administration Board is a federal agency that regulates federal credit unions and insures member deposits up to $250,000. It liquidated the Electrical Workers No. 527 Federal Credit Union in May 2013, forcing its 527 clients, mostly union members and their kin, to bank elsewhere.
The NCUA sued the credit union’s former manager Susan Garza, her husband and their three adult children on Sept. 10 in Federal Court.
The NCUA says a look at the books showed the problem was obvious: Susan Garza stole cash from the teller drawer and took money from “innocent member” accounts to cover it, wrote checks from the credit union’s depository account to pay her own bills, issued fraudulent loans and used members’ money to make loan payments, and used the bank’s money to buy money orders to pay her personal bills.
She hid the thefts by falsifying members’ account statements or not issuing them at all, the NCUA says.
“As a direct result of the defendants’ unlawful activities, the credit union suffered losses of at least $466,675.32 and became insolvent,” the lawsuit states.
The NCUA’s insurance paid that amount to cover Garza’s victims’ losses.
It seeks punitive damages for conversion, fraud, breach of fiduciary duty, theft, gross negligence and negligent misrepresentation.
The NCUA says it traced the family’s purchase of three Galveston homes to the stolen money. It asked the court to transfer the homes to it.
The credit union was in Texas City, pop. 46,000, a blue-collar port town on Galveston Bay that is home to three large refineries. Though the petrochemical industry has brought good-paying jobs to the area, it has come at a cost.
In 1947 a French ship carrying ammonium nitrate fertilizer exploded at the Texas City docks, obliterated a Monsanto plant and set two other fertilizer-laden ships on fire, which also exploded. The blasts killed 581 people and injured more than 5,000. It was the deadliest explosion in U.S. history.
In 2005, an explosion at the BP refinery killed 15 workers and hurt dozens. BP sold the refinery to Marathon Petroleum for $2.5 billion in 2012.
- Patient Claims Doc Used Her for Profit
- Tree Ring Data Show|500-Year Calif. Drought