Included in the five prohibition notices issued by the NCUA in April was a former CEO of the now defunct U.S. Mortgage Corporation and CU National Mortgage, LLC.
Michael J. McGrath, Jr. is one of five individuals who were convicted of crimes of dishonesty and are now prohibited from participating in the affairs of any federally insured financial institution. McGrath pleaded guilty to conspiracy charges to commit mail and wire fraud and money laundering while serving at the Pine Brook, N.J.-based companies. He was sentenced to seven years in prison and three years' supervised release, and was ordered to pay more than $139.6 million in restitution.
McGrath conspired over a five-year period to fraudulently sell credit union loans and used the proceeds to address cash flow problems created by losses on investments in mortgage-backed securities.
In April, prohibition orders were also issued against the following individuals:
• Melissa Ann Joiner, a former employee of Metro North Federal Credit Union ($16.4 million in assets) in Jacksonville, Fla., pleaded guilty to the charge of theft. She was sentenced to one day in prison and five years' probation, and was ordered to pay court costs.
• Schrelle L. Malone, a former employee of Pacific Marine Credit Union ($747.8 million in assets) in Oceanside, Calif., pleaded guilty to the charges of theft, identity theft and burglary. Malone was sentenced to 21 days in prison and three years' probation, and was ordered to pay restitution in the amount of $4,892.81.
• Yvondia M. "Susan" Young, a former manager at Heritage Trust Federal Credit Union ($529.1 million in assets) in Summerville, S.C., pleaded guilty to the charge of bank fraud. Young was sentenced to one year in prison and five years' supervised release, and was ordered to pay restitution in the amount of $325,521.82. Young allegedly issued Heritage Trust checks to pay for her personal credit card bills. The fraudulent scheme transpired from August 2007 to February 2013.
• Randy Gard Teall, a former vice president of Global Credit Union ($395.8 million in assets) in Spokane, Wash., pleaded guilty to the charge of bank fraud. Teall was sentenced in February to one year in prison and five years' supervised release, and was ordered to pay restitution in an amount that has not yet been determined by the court. Court documents revealed that Teall pleaded guilty to making false statements in June 1997 on a $40,000 customer loan application while he was working at U.S. Bank.
Violation of a prohibition order is a felony offense punishable by imprisonment and a fine of up to $1 million.
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