NCUA Bans Two Former CEOs, Branch Manager and Employee
One of the ex-CEOs, a pastor, is released early from prison and has not made full restitution.
Two former credit union CEOs – including one who is a church pastor – a former branch manager and an employee were banned from ever participating the affairs of any federally insured financial institution, the NCUA said Thursday.
Stacey Shaw, former president/CEO of the $7.6 million IBEW Local Union 712 Federal Credit Union, is scheduled to be sentenced in January 2022 after pleading guilty to a $2 million embezzlement scheme in U.S. District Court in Pittsburgh in April.
Starting in May 2017, just five months after she became CEO, Shaw opened credit cards issued by the Beaver, Pa.-based credit union and made $2,099,437 in charges and cash advances through March 2020, according to federal prosecutors. Because she did not report her ill-gotten income on her federal tax returns, she also will be held liable to pay the IRS $519,394, plus interest, according to the plea deal. Shaw also pleaded guilty to one misdemeanor count for not filing a federal tax return.
In May 2020, the NCUA liquidated the credit union, and its assets, member shares and loans were immediately assumed by the $26.7 million West Penn P&P Federal Credit Union, also of Beaver.
Trevon Gross was the former chair and CEO of the Helping Other People Excel Federal Credit Union in Lakewood, N.J. Gross, who still is the lead pastor of Hope Cathedral in Jackson, N.J., was found guilty in 2017 for taking $150,000 in bribes from criminals to use the credit union as a front to run an illegal Bitcoin operation. The bribery funds were deposited into the church’s account at the credit union, which was liquidated by the NCUA in November 2015. Gross was sentenced to five years in federal prison. With a little less than half of his sentence remaining, he received a compassionate release from prison in April 2020 because of his underlying health problems that made him vulnerable to contracting and dying from the COVID-19 virus.
He was ordered to home confinement for the remaining portion of his original term of imprisonment, which ends in May 2022, according to court documents. In June 2021, Gross asked a federal judge to remove the condition of home confinement. A federal judge denied his request because of “Mr. Gross’s lack of remorse or acceptance of responsibility (during his sentencing hearing) – and it continues to weigh heavily.” Gross also has not made full restitution, which was reduced from $194,293 to $126,771, plus a $12,000 fine and a special assessment of $200, court documents showed.
Johnnie Earl Harrell, a former branch manager at the $95.5 million Welcome Federal Credit Union, is scheduled to be sentenced in December for embezzling at least $645,000 from the Morrisville, N.C.-based credit union.
He pleaded guilty in U.S. District Court in Wilmington to theft and embezzlement in June 2020, according to court records.
While working at the branch in Zebulon from 2008 to 2019, he convinced members to roll over their retirement accounts into annuities, but he never bought the annuities and stole the funds for his own personal use. Harrell managed to conceal his fraud for 11 years by preparing fake annuity account statements that were periodically presented to members, prosecutors said. Prosecutors did not say how many members were affected by the fraud or how Harrell spent the members’ funds.
Jonathan Sanchez-Santiago, a former employee of the $289 million Guardians Credit Union in West Palm Beach, Fla., was charged with grand theft in April, according to the NCUA. The federal agency’s prohibition notice, however, did not stipulate how much money he allegedly stole from the credit union or what the judgement was in his criminal case. Sanchez-Santiago’s case documents were not available online.