The collapse of Telesis into conservatorship set off a firestorm of internal industry debate and angst, as well as well-orchestrated and fierce attacks from the bankers' associations about the efficacy of credit union business lending.

The conservatorship of Telesis also comes as Congress is about to undertake key votes on proposed legislation lifting the credit union member business lending cap.

The conservatorship of Telesis, which serves 36,700 members, marks the second credit union taken over due to business loan troubles. The now $1.4 billion Texans CU in Richardson was seized in April 2011 and is still being run under conservatorship. Telesis was the third federally insured credit union conservatorship so far in 2012.    

In assessing the Telesis aftermath, much attention was being focused last week on Mayo, once a visible advocate before lawmakers in Sacramento and Washington in support of credit unions taking on more business lending powers. 

Mayo served on several committees of the California/Nevada Credit Union Leagues and was first elected to the CUNA board in 2004 serving until February 2008. 

Publicly available biographies show Mayo joined Telesis in 1986, at a time the credit union had $600 million in assets and 41,000 members with 10 branches. It now has dropped to $318 million in assets and four branches. 

Mayo also chaired Business Partners, a multi-owner member business lending CUSO with 15 equity owners' nationwide managing assets of $1.5 billion. She also served as chair of CU Vehicles LLC, the holding company for Autoland Inc., described as the “largest vehicle purchasing CUSO serving hundreds of credit unions nationally.”

Mayo received her bachelor's degree in business management from University of the Pacific, graduate degree in financial management from UCLA, and a certification in commercial lending from the University of Louisiana. In addition, she attended the executive development program at Stanford University School of Business. She was a frequent industry speaker. 

The California league said she was an ex-officio director and had been a member of the Applied Research Institute 2000-2005, Competitive Environment Task Force 2000-2005, Government Relations Committee 2000 and 2005-2007, Technology Task Force 1997, Facilities Review Committee 1998, and Renaissance Task force 2001. 

Lamenting the Telesis fallout in a blog posted last week, Charles Bruen, president/CEO of the $920 million First Entertainment CU of Hollywood, called the conservatorship a sad day in the industry's stature, both in Los Angeles and across the nation.

“Picking up The Los Angeles Times and reading these headlines: 'Telesis Credit Union Fails' or 'Chatsworth Credit Union Demise Ignites Pay Business Loan Debate' can't be good for any credit union.” He added that it eroded member and public confidence in all credit unions.

The Telesis “cloud dims the light for everyone starting with the staff, the CUSO partners, the local credit union community and then the entire credit union movement,” he said.  

Like other industry observers, Bruen noted also that the media coverage has been on “how the banks will use the Telesis failure as exhibit A in their case against granting additional MBL powers to credit unions.”