Funds that were drawn from the fake loans were allegedly stolen through checks made payable to the fictitious members, the credit union or an auto dealership, which was not identified in court documents.

In addition, deposits made using the fake loan funds were funneled into Ray’s credit union account or the accounts of family members. However, Ray controlled the family member accounts, according to court documents.

To cover up the bogus deposits, Ray allegedly posted them as “deposits in transit,” federal prosecutors charged.

Ray’s attorney, Walter Francis Becker Jr. of New Orleans, declined to comment on the case against his client.

On June 28, 2013, the NCUA liquidated the $9.25 million OCFCU stating in a release it had determined the credit union was insolvent and had no prospect for restoring viable operations. The $307 million ASI Federal Credit Union of Harahan, La. immediately assumed OCFCU’s members, deposits and loans.

Court documents revealed that during the course of an NCUA audit, Gail Teague, who worked as an office manager for the credit union, admitted to stealing $34,000 by creating a fraudulent loan.

Ray is Teague’s sister, according to court documents.

On May 17, 2013, more than one month before the NCUA announced OCFCU’s liquidation, Teague signed a hand-written confession acknowledging the theft after auditors interviewed her.

In December 2014, Teague was charged with theft of bank funds. She pleaded guilty and agreed to testify against Ray. Teague was sentenced in July 2015 to three years of probation and was ordered to pay $34,000 in restitution.