NCUA Bans Former CEO, Finance Director, Manager, Loan Officer Manager

A former credit union CEO, a finance director, a manager and a loan officer manager were banned from ever working at a federally insured financial institution, the NCUA said Thursday.

Gloria Jean Hall, ex-president/CEO of the $3.1 million Prairie View Federal Credit Union (PVFCU), admitted in federal court in April that she stole more than $211,000 from two elderly member accounts.

She pleaded guilty to one count of embezzlement.

Hall is expected to be sentenced in January, federal court filings showed.

PVFCU was one of the nation’s oldest continually operational federal credit unions established by a historically Black college, the Prairie View, Texas-based A & M University. The NCUA approved its merger with the $356 million Cy-Fair Federal Credit Union in Houston during the first quarter of 2022. PVFCU was consolidated because of its poor financial condition.

Salusthian Lutamile, a former finance director and CFO for the $799 million IDB Global Federal Credit Union in Washington, D.C., was found guilty by a jury in May 2022 on 21 counts of bank fraud, theft by a credit union employee, wire fraud and money laundering.

He was sentenced to 44 months in federal prison and was ordered to pay restitution in September 2022.

He previously worked as the credit union’s controller and was one of its lead auditors as a certified fraud investigator who led fraud investigations.

Lutamile stole $610,000 via seven unauthorized transfers of funds into a dormant credit union account that was linked to his investment account to buy stocks of major corporations and to fund his personal retirement account.

His fraud was discovered only a few weeks before he was scheduled to resign in April 2019, according to court documents.

Although an appeals court turned down Lutamile’s request to reduce his sentence because of errors made in the calculation of the credit union’s actual losses, prosecutors agreed to reduce his sentence from 44 months to 41 months. Even though he stole $610,000, the credit union recouped most of those funds and the actual loss was $76,069, court filings showed.

He is scheduled to be released from prison in December at a medium security federal prison in Cumberland, Md., according to Federal Bureau of Prison records.

Laurie Allen pleaded guilty to one count of financial institution fraud and admitted in October 2023 that she stole more than $500,000 from the branch vault while she was the manager of the $50.2 million First Illinois Credit Union in Danville, Ill.

Allen began her theft in January 2014. By June 2017, First Illinois merged into the $1 billion Vibrant Credit Union in Moline, Ill. At the end of the second quarter of 2017, First Illinois recorded a loss of $1,494,754 compared to an income gain of $72,692 in June 2016, according to NCUA financial performance reports.

Nevertheless, her theft continued post-merger through December 2020.

She was sentenced to five years in state prison last year.

From July 20, 2020 through June 8, 2022, Diane Stephens was employed as a loan officer manager with KGC Federal Credit Union, which is now the $152 million Priority First Federal Credit Union in Du Bois, Pa.

While she worked there, it is alleged that she participated in misconduct which ultimately caused a monetary loss resulting in her termination, according to one of NCUA’s findings. The federal agency, however, did not report the amount of that monetary loss.

In June 2022, Priority First began investigating Stephens’ alleged actions, which revealed her various means of the misconduct. The NCUA did not describe that misconduct or whether it was reported to law enforcement.

Nevertheless, according to the federal agency, the alleged misconduct led to her “bondability being revoked by TruStage.”

“By reason of the foregoing conduct, Respondent (Stephens) alleged to have breached her fiduciary duties to KGC FCU, now Priority First FCU, and its members and engaged in unsafe or unsound practices,” the NCUA stated in the Consent Prohibition Order. “Respondent’s conduct could have prejudiced the interests KGC FCU’s, now Priority First FCU, members and provided a gain or other benefit to herself; and Respondent’s alleged misconduct demonstrated personal dishonesty and/or unfitness to participate in conducting the affairs of a credit union.”

Stephens did not admit or deny wrongdoing, according to the NCUA.