Purported Real Estate Broker Stonewalls NCUA Investigation of Conserved CU

A purported real estate broker from Georgia has been stonewalling an NCUA investigation of the conserved Community Owned Federal Credit Union in Charleston, S.C., by failing to produce documents despite a subpoena and a court order, recent filings in a U.S. District Court in South Carolina showed.

The NCUA began investigating the credit union in September 2020 and issued a subpoena to Vincent Terry a month later that demanded he turn over documents. The independent federal agency alleged Terry was the CEO of a CUSO for the credit union, Westminster Mortgage of America (WMOA), which generated an “alarming number of highly questionable loans,” and that most of those loans are in default.

In early 2019, Terry presented himself to the credit union stating that WMOA would underwrite loans from COFCU and the National Direct Mortgage agreed to purchase all those loans. That meant the credit union’s initial funding of those loans would be fully reimbursed and its financial risk would be negligible, according to the NCUA.

Terry’s assertions were false and neither he nor WMOA held valid licenses to underwrite or broker mortgages for sale in the secondary market, the NCUA alleged in court documents.

What’s more, Terry later admitted to the COFCU board of directors that he and WMOA largely generated and/or underwrote unsecured loans to himself, his relatives, his associates and his friends. Almost all of the loans are in default, and none of the loans were ever assumed by National Direct Mortgage or any other legitimate entity, the NCUA alleged.

Initially, through his lawyer, Terry said he would hand over the documents but later claimed he did not have certain papers or that he did not know about documents the NCUA was looking for. In response to the NCUA’s subpoena for documents of loans generated by Terry, he claimed not to have underwritten any loans.

“We object to the request regarding all loans generated by Dr. Terry as being over broad and irrelevant as it relates to CO Federal Credit Union,” Terry’s lawyer wrote in a letter to the NCUA in December 2020.

Although the NCUA did not reveal the number of loans or their total value allegedly generated by Terry, first mortgage real estate loans/lines of credit charge-offs amounted to $730,200 and $142,157 in charge-offs for all other loans, for total charge-offs of $872,357, according to COFCU’s Call Report for the first quarter of this year.

The credit union recorded a loss of $457,207 at the end of 2020, and a loss of $741,074 at the end of this year’s first quarter, according to NCUA financial performance reports.

Last January, the federal agency placed the $4 million COFCU into conservatorship. A month later through the U.S. Attorney’s Office in Charleston, S.C., the NCUA asked a federal judge to grant a court order to enforce the NCUA subpoena. At the end of February, U.S. District Court Judge Richard M. Gergel granted that court order, which was delivered to Terry’s homes in Atlanta and Hampton, Ga.

There is no indication that Terry has responded or complied with the court order to submit the documents demanded by the NCUA subpoena.

Terry and his lawyer did not respond to CU Times‘ requests for comment on Tuesday.