NCUA Bans Three Former Credit Union Employees

Three people, including a second former employee of a Mississippi credit union and a third former employee from a North Dakota credit union, were banned from ever participating in the affairs of any financially insured financial institutions, according to the NCUA’s prohibition orders released Thursday.

While serving as an employee at the $2.2 million Mississippi Central Federal Credit Union in Morton, Whitney Phillips allegedly caused the credit union to issue unauthorized payments that benefited her, according to the NCUA. She also was allegedly engaged or participated in unsafe or unsound practices, which harmed the credit union.

Phillips neither admitted nor denied the NCUA’s allegations.

The federal agency’s prohibition order, however, did not say how much money was involved in the unauthorized payments, when they occurred, and whether she made or agreed to make restitution.

Phillips was the second credit union employee from Mississippi Central to be banned by the NCUA.

The first former employee banned by the federal agency in July was Nellie Gray, who was the president/CEO of Mississippi Central and allegedly caused the financial cooperative to issue her additional payroll checks on top of her regular salary. She also allegedly paid herself advances on an anticipated annual bonus where those advances exceeded the bonus that was subsequently authorized, the NCUA said in its prohibition notice.

The federal agency did not report how much money Gray allegedly paid herself, for how long her scheme lasted, or whether the former CEO has made or has agreed to make restitution.

Gray had been the CEO from at least June 2012 through December 2019, according to NCUA profile reports.

Amy Bradley was the third former employee of Citizens Community Credit Union to be banned, the federal agency’s August prohibition order showed. The Devils Lake, N.D.-based credit union, which posted a loss of nearly $8 million and was conserved by the NCUA in June 2017, was merged into the $1.2 billion First Community Credit Union in Jamestown, N.D., at the end of that year.

Nine months earlier, however, on March 1, 2017, Bradley was charged in the Northeast Judicial District in Rolette County, with three felony thefts and a misapplication of entrusted property charge in connection with her employment at CCU and FCCU. In October 2021, Bradley pleaded guilty to two felony counts of theft and one felony count of misapplication of entrusted property.

She was ordered to pay $76,000 in restitution, according to the NCUA. Although Bradley was sentenced to 24 months in prison, it was suspended.

The first CCCU former employee to be banned by the NCUA in January 2020 was Charity Hope Erickson. She was sentenced by a local court judge in March 2019 for misapplication of entrusted property. In its prohibition order, the NCUA did not report what was the “entrusted property” or its value, or what her specific sentence was.

In May 2023, a consumer loan processor was the second former employee at CCCU and FCCU to be banned by the NCUA. In November 2019, Kaitlin Kastet was charged with two felony theft counts.

After pleading guilty to one count of theft in November 2021, she was sentenced to 12 months of supervised probation and ordered to pay $6,293 in restitution, the NCUA said.

Melissa Velazquez joined the $622 million Financial Resources Federal Credit Union in Bridgewater, N.J., in June 2022 and worked as a member service center manager until she was fired on March 20, 2023.

With access to member accounts and her ability to conduct transactions, she allegedly embezzled funds from members, forged checks and made ATM withdrawals on those accounts for personal gain, according to the federal agency.

The NCUA administrative order, however, did not report how much money Velazquez allegedly embezzled or whether she made or agreed to make restitution.

Velazquez neither admitted nor denied the allegations.