DENVER (5/14/10)--An An alleged phoney credit union based in the Virgin Islands with an office in Colorado continues to stir up concern among credit union organizations and regulators. In light of the recent publicity over Her Majesty's CU (HMCU), which has a back-office processing office in Denver, the Credit Union Association of Colorado (CUAC) issued a statement, saying it had met with the credit union this week. John Dill, CUAC CEO, said the association "continues to review the reports surrounding Her Majesty's CU with concern." News Now
had posted an article Thursday about state and federal regulators' attempts to determine whether the credit union was legitimate. The credit union's CEO is the CEO of an organization that had sponsored another credit union in Georgia that had failed eight months after it opened in 2005 (News Now
May 13). Representatives from CUAC met Wednesday in Denver with Stan Roberson, CEO of HMCU "in response to HMCU's website, which suggested that certificates of deposit could be obtained by non-members," Dill said. "It was the intent of CUAC to determine if HMCU was operating as a deposit-taking financial institution within Colorado," he added. The meeting "occurred approximately two years after a May 29, 2008, HMCU meeting with CUAC to petition for membership in the association. HMCU did not receive CUAC membership because, per CUAC bylaws, the credit union did not have a member service 'brick and mortar' location within the state of Colorado," Dill said. "After the Wednesday meeting, CUAC felt that Mr. Roberson provided inconsistent information regarding the background of HMCU and [CUAC] remains concerned about various inconsistencies uncovered in our visit," Dill said. Some of the inconsistencies include:
* "Roberson stated to CUAC that HMCU was the only credit union in the U.S. Virgin Islands. Upon review, CUAC staff members found five federally chartered credit unions located in the U.S. Virgin Islands," said Dill. * "Roberson stated that a federal charter and the National Credit Union Share Insurance Fund was not available to credit unions chartered in the U.S. Virgin Islands. CUAC staff has determined that the other five credit unions chartered in the U.S. Virgin Islands do have federal charters and NCUSIF insurance," Dill added. * "Roberson stated that HMCU was once a member of the Credit Union Association of New York (CUANY). CUAC staff has determined that HMCU has not been a member of CUANY." * "Roberson stated that HMCU was a member of the Credit Union National Association (CUNA), and the CUNA logo was displayed on the HMCU website. CUNA now informs us that HMCU is not a member of our national association."
"The CUAC is vitally interested in protecting the strong reputation of credit unions in Colorado as well as across the nation, and we continue to have extreme concern over HMCU and the veracity of this organization," Dill said. "As appropriate, CUAC will continue its vigilance of HMCU on behalf of Colorado consumers and credit unions," he added. The CUNA logo referred to is the "America's Credit Unions" trademark. News Now
checked HMCU's website Thursday and found the brand displayed prominently on the site's home page. "The credit union has ignored CUNA's requests to remove the America's Credit Union trademark and slogan, 'where people are worth more than money' from its website," said Linda L. Lilledahl, vice president and association general counsel at CUNA. She told News Now
that the marks are used by CUNA members and available to nonaffiliates that obtain a license from CUNA. "This credit union has no license," she said.