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News Now

CU System
Former CEO claims retaliation over board spending
WAYNE, N.J. (5/22/09)--A trial date has not been set yet in the case of a former credit union CEO who filed a whistleblower lawsuit on Dec. 3 in Passaic County Superior Court, Paterson, N.J. against First Jersey CU. The complaint filed in court alleges that former President/Chief Operating Officer Joann Lazzara, was fired Oct. 17, 2008, in retaliation for expressing concerns during a June 2007 state audit about board members' spending. Lazzara's complaint says board members violated the Wayne, N.J.'s credit union's travel spending limits and did not disclose the expenditures to members. At the time, the credit union was losing $200,000 a year in income because its new $6 million building was paid for by using liquid assets instead of taking a mortgage, and the board cut the marketing budget and refused to hire an additional business development position, the court document says. The complaint says the credit union told Lazarra it terminated her for not meeting the credit union's goals, but the lawsuit maintains the goals set were "unrealistic." Lazzara's complaint says some board members and their guests took cruises to the Mediterranean, Alaska, Panama and Scandinavia and spent more than double the credit union's per-trip limit. The document outlines expenditures totaling more than $221,743.42--an average of $5,685 per trip--for 39 trips taken by 12 board and examining committee members from 2004 through 2007. Lazzara's attorney, Robyne LaGrotta of Totowa, N.J., filed the lawsuit under the New Jersey Conscientious Employee Protection Act, on Dec. 3. She is getting depositions and told News Now that the case could drag out over two years. Currently the suit is in the 450-day discovery process and the discovery could be extended.


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