Credit Union Lapse Troubling
By The IntelligencerFederal regulators are seeking more authority over financial institutions such as banks and credit unions. Until they see evidence that the so-called watchdogs are doing the jobs they are supposed to under current law, members of Congress ought to refuse to grant them more power.
A case in point occurred right here in Wheeling. Earlier this year the National Credit Union Administration shut down Center Valley Federal Credit Union of Wheeling. Those with deposits at the credit union were to be reimbursed for any losses, up to the $250,000 federal limit on such insurance.
This week federal prosecutors arrested a Valley Grove woman, charging her with embezzling money from the credit union. The woman, Bernie Metz, 56, formerly was chief executive officer and manager of the credit union.
During a hearing, Assistant U.S. Attorney Robert McWilliams stated that "$5 million of the $9 million missing from the credit union can be traced to Bernie D. Metz."
Nine million dollars may not sound like much in the context of trouble suffered by big national financial institutions during the past year. But here in Wheeling - especially at the Center Valley Federal Credit Union - it's a lot of money.
According to a news release issued by the NCUA in February, when it placed the credit union into liquidation, the institution "had deposits of approximately $8 million."
In other words, before the NCUA noticed anything amiss, someone had looted more than the credit union's total assets at the time of the takeover. That is astonishing, to say the least.
Members of Congress should be demanding answers from the NCUA in regard to the Wheeling fiasco. Were regulators asleep at the switch? What has been done to guard against similar lapses in the future? And, perhaps most important: Why should the public trust federal regulators with more power when they cannot seem to use what they have effectively?
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TNMountaineer
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07-25-09 4:31 PM
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Congress is not going to investigate the financial mess because they created it.Please read a report of the House Oversight and Government Reform Cmte. by ranking member Mr. Issa, a representative from California for additional information. It is available on-line and is very interesting reading.
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TNMountaineer
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07-25-09 4:25 PM
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It started with the creation of Fannie Mae Charter Act of 1968. However, it alone, in my opinion, was not the sole source of the problem. The FDIC, at the behest of Congress, raised the insurance coverage for bank depositors from $40,000 to $100,000 (and now to $250,000) which allowed bankers to take on more risky loans. What really opened the flood gates to the financial crisis was the gutting of the Glass-Steagall Act of 1933 by the 106th Congress by the Gramm-Leach-Bliley Act and Clinton Administration and perpetuated by the last Congress and Administration. The Glass-Steagall Act originally created a wall between commercial banks (supposedly conservative, low-risk lending practices) and investment banks (the banks for risk-taking investors). Removing this wall allowed the commercial banks to also market loans to investment bankers who then, through their overseas branches sold them to foreigners too.
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GoldenArm
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07-24-09 12:01 PM
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Yes, BDS has reared it's ugly head. Unfortunatley, it stands for: Bush Defenders Society Take a chill pill people. Why so defensive about 43?
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Highland
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07-24-09 11:26 AM
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Bush Derangement Syndrome rears its ugly head even in a discussion of a small-town crook. Pathetic.
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TruthSeeker
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07-24-09 7:17 AM
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Did Ogden get any of that ill-gotten gain for advertising? Seems to me if y'all did, ya outta give it back. Would be the only way to soothe your souls about the troubling credit union lapse. Just sayin'...
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outofhand
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07-23-09 11:42 PM
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Can't politics be left out of all of this, there are liberals that have embezzled and conservatives that have embezzled how do you blame a president for a small town institution? You ought to at least try to sound intelligent. A thief is a thief. Look I don't know how half of these people get away with what they do for so long, but it dishonesty always comes back to bite you. It finally caught up to her and I hope if found guilty her and her family sees what it is like to do without and have to work for what they get like the rest of us. Who is going to trust any of them to work at any business. I know I wouldn't hire any of them.
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ElScorcho
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07-23-09 9:06 PM
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This is hardly Georgie W's fault. The man was many things....incompetent, inept, irresponsible. Let's leave him in the past and try to move forward with the badly listing ship-of-state that he and his cronies have left us and leave it at that.
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WVEXPAT
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07-23-09 8:19 PM
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Bringing up W in relation to this crime is hilarious (in a pathetic, troubled kind of way)!
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roxtar
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07-23-09 5:48 PM
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Of course it's not Dubbaya's fault that bernie Metz is a crook. It's his fault that she wasn't caught sooner. If we invested in a War on Crooked Financial Officers instead of a War on Drugs, our economy would be in much better shape. (BTW, how's that War on Drugs working out? Have we won yet?)
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Highland
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07-23-09 2:16 PM
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It's W's fault that Bernie Metz was a crook? Gee, is he responsible for all of the crimes of the past 200 or more years, too?
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steelercrazy
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07-23-09 9:04 AM
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That's right Nancy, W caused this. The hatred never ends...
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NancySI
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07-23-09 8:08 AM
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The last inhabitants of the White House were "asleep at the switch" in more ways than one. Let the free market fix itself....lol
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Interesting
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07-23-09 7:41 AM
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Is this another editorial in the 'latest news' section?
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wvhoopie
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07-23-09 6:59 AM
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What was the Board doing? Were there Board meeting? What about the committees that oversee loans? How did this get concealed from the NCUA auditors? As a board member on a credit union, you can see alot of what is going on at each monthly meeting. What was going on at those Board meetings?
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EllisWyatt
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07-23-09 6:51 AM
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Where were the auditors? Where was the oversight? How do you steal $20,000 per week, for 5 years, in a bank that small and nobody notices? Do you think that someone else might be in on it?
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