Former CU Manager Admits Using CU's Fraud-Alert System to Steal From Members

A former operations manager, who was responsible for a credit union’s fraud alert process, used it to steal more than $60,000 from members and to conceal her crime.

U.S. Attorney Jesse Laslovich in Billings, Mont., said Kelly Jo Muzzana, 40, pleaded guilty last week to one felony count of embezzlement by a credit union employee when she worked at the $579 million Altana Federal Credit Union in Billings.

“We have strong fraud identification procedures in place, which we used to unveil this activity,” Altana Chief Experience Officer Megan Kongaika said. “We terminated the employee, worked with local law enforcement and ensured that no members were financially impacted.”

From January 2023 through Dec. 12, 2023, Muzzana embezzled the credit union’s member funds by using debit cards, credit cards and account information of customers to make unauthorized purchases.

Muzzana created duplicate bank cards for customers’ accounts and took them home with her in addition to taking cards Altana received in the mail that were not delivered to members. She used the bank cards to make purchases online and in retail stores around Billings, prosecutors said.

The former credit union employee had access to customer data and was responsible for processing Altana’s entire fraud-alert process. This enabled her to process members’ fraudulent spending claims personally to avoid detection and prevented many members from filing police reports.

Some members, however, did file police reports.

Court documents did not reveal the number of credit union accounts that had been affected by the embezzlement.

Muzzana was released on her own recognizance pending a sentencing hearing that has yet to be scheduled.