The question had to do with recruiting better board members for a particular credit union.

My initial thought, which I did not say out loud, was maybe this person was in the wrong session.

After a few beats of thinking, I was reminded of the trouble over at Municipal Credit Union and replied to the person, "I don't know how to recruit good board members. But as we're finding out with the MCU lawsuit, there appears to have been a competency issue that has the credit union in a lot of trouble."

To back up for a second – MCU is the multi-billion-dollar credit union in New York, formerly led by Kam Wong. He was fired by the board in June after it was discovered he had allegedly been stealing millions from the credit union. And, according to our reporter Peter Strozniak's story, the board allegedly became so wrapped up in the scandal that "the New York State Department of Financial Services removed the entire board for failing to discharge their duties and for accepting compensation, which is prohibited in the Empire State."

Since the board has been removed, a lawsuit has been filed by the former board members to get their seats back (and reputations cleared).

Peter and I have had a number of discussions about this story with our news team and one-on-one. The question I continually go back to is this: Is the board responsible for what happened at MCU in any way?

According to court documents, findings by federal investigators and interviews conducted by CU Times, the former CEO Kam Wong was reimbursed by the credit union for millions of dollars in personal tax liabilities, fake dental work, long-term disability insurance, education, housing, fake car repair bills, living expenses for relatives and other cash advances.

This apparently went on for years and a board member, who asked to remain anonymous, spoke with CU Times and appeared to put the blame on the fact that the board is made up of volunteers. In part, the board member said, "… and because we are volunteers and we are not there from day to day, we rely on several levels of reporting and review."

This board member claims that the full MCU board only saw abridged versions of 990s and didn't see the total compensation paid to Wong and other credit union executives.

"Had we seen the [Wong] income, we would have … I would have definitely objected. There's no question about it," the board member said.

There appears to be a real problem and possibly a true disconnect of responsibility between the duties and ramifications of volunteer board members, especially in this case.

When we first learned about the details concerning what people/board members knew, when they knew it and what Wong allegedly got away with for so long, our reporters all had similar reactions: Who's responsible here? The board? The executive team? The CEO? All of them?

Allegedly millions of dollars went out the door and no one involved appears to have a clear answer why.

This leads back to the old question: Should credit unions move away from the volunteer board member structure?

It's a very important question that deserves an answer. Yet, that topic is like asking a group of people to agree on the best movie ever made. My vote: West Side Story.

Does the NCUA need to take a hard look at the credit union board structure and revamp the rules and regulations? Do the credit union leagues take this on? Or do we let credit unions decide for themselves what works and what doesn't?

This example of MCU shows a real need for someone or some agency to step up and make the hard decision. I personally know several people who volunteer on credit union boards and some of them are completely competent and smart people who have a critical eye focused on the success of their credit union. Others simply enjoy going to Las Vegas for a credit union conference with their spouse once or twice each year.

We don't want this industry or credit unions to crumble due to board volunteers who don't understand the financial details or administrative issues happening around them at their credit union. I'm not saying that's what happened at MCU. I'm saying that what is happening at MCU raises a lot of concerning questions with no real answers. Sometimes it's like walking into your local polling place and seeing all of the volunteers who believe in the democratic system, and asking whether we should trust them with running the government just because they volunteered.

According to Peter's story, in October, seven of the 10 MCU board volunteers will be asking the judge hearing the case to grant a "temporary restraining order, a preliminary injunction and a permanent injunction to prevent the state regulator to appoint a new board" and to return the former board directors to their previous board seats.

We'll be watching and reporting what happens from this hearing, because either way this comes down from the judge's ruling, it could potentially have a lasting impact on the purpose and structure of your credit union's board.

"If I go, there will be trouble. And if I stay it will be double," – The Clash, 1982.

Michael Ogden, CU Times Executive Editor

Michael Ogden is executive editor for CU Times. He can be reached at [email protected].