... fudge can impair your figure(s)!
✅ Seized credit union planned to understate loss - NCUA
By Reuters Staff
WASHINGTON, April 10, 2009 (Reuters)
Senior managers - [the CFO usually prepares and publishes the financial statement - Mr. Hayes was the CFO] - at a major corporate credit union - [you guessed it - Wescorp!] - seized last month were preparing to report a credit loss significantly below what an external analysis had revealed, the U.S. regulator of credit unions said on Friday.
An external analysis by Western Corporate (WesCorp) Federal Credit Union resulted in a credit loss estimate more than $500 million greater than WesCorp’s internal estimates - [internal estimates usually performed by "senior experts" with "capital markets specialist" skills] - the credit union regulator said.
Senior managers at WesCorp were prepared to report an impairment figure for certain securities as of Dec. 31 that was based on the lower internal estimate, the National Credit Union Administration said.
WesCorp Suit Alleges Negligence.
The suit, filed Nov. 24, charges that officer and volunteer defendants began to change WesCorp's investment focus in or around 2003 [same year, 2003, Mr. Hayes joined Wescorp senior staff as SVP in charge of ALM ("asset liability management") in charge of investment/balance sheet risk], when the corporate invested in more mortgage- and asset-backed securities, particularly subprime, alt-A and option ARM collateralized instruments.
That "irresponsibly risky" investment program abandoned the "mission, purpose and goals of the credit union system," plaintiffs claim. Furthermore, defendants failed to recognize economic conditions and take steps to protect assets, instead reassuring members that "finances were sound" and that "WesCorp's 2008 financial performance would be its best year ever."
Other defendants include dismissed executives Robert Siravo and Robert Burrell, as well as current and former WesCorp employees James Hayes, Jeremy Calva, Laura Cloherty, Jeff Hamilton, Dwight Johnston, Timothy Sidley and DavidTrinder.
... smiling because you like fudge?
... y'know, I really can't stand much more of this!
👎 [Yep, you're not alone!]
Tell me how the little worker bees could automatically see thru this guys bs but the ones who make the decisions could not. All those dinners must have been nice while we were under staffed and had a hiring freeze
ReplyDeleteWell he landed another CEO gig and the cycle continues. Perhaps someone there will start a blog like this.
DeleteHe’s just not genuine. He just isn’t. All the selfies and media posts won’t change this. There’s just some people where your spider senses trigger and he’s one
DeleteThe selfies & media posts are exactly what make him not genuine. Let’s not even get into the pervasive, rambling and mostly incoherent emails to all employees sent in the name of transparency. It was so obvious to most everyone (but him) that it was all about stroking his ego. He is as fake as they come. Good riddance and thank goodness he is now someone else’s problem.
DeleteFirst time Westcorp is mentioned on this blog is on May 19, 2023. Y'all wonder when Gym called NCUA to get him another credit union CEO job? 3 guesses.
ReplyDeleteAnd another poor Credit Union picked him up. Hundreds of eligible candidates why oh why the focus on one . Credit union industry should just cut him loose and look elsewhere .
DeleteEven if the board of this drifter's new place didn't know what was going when they made the decision (SECU picked him so he must be good for us too and he could have spun a believable story as to why he was leaving the 2nd largest credit union to a relatively small one in a year), by now they would have caught on to it since this is big news in the credit union space. Why didn't they rescind the offer? Makes one wonder... 🤔
DeleteBet all the employees (and members, if they are aware) in his new work place are nervous and worried watching what's happening here since it's all out in the open now.
DeleteI just don't understand how the heck he keeps getting jobs in the credit union world after all he has done. No one did their homework when hiring this guy. SDFCU is in for a ride awakening
Delete10:35 am - take a tour through NCUA and you'll understand. Washington politics.
DeleteIs the board meeting open to members? What happens to the open spots if Board members resign?
ReplyDeleteOh no! Please, there isn't more bad news about this horrible narcissistic man! and this totally incompetent BOD for putting him in charge at our credit union. If there is, will you hurry up and give it to us! this is turning into a cliffhanger. Maybe all the BOD will resign and Leigh on Tuesday and we can have an emergency annual meeting and get our credit union away from the wolves!
ReplyDelete@7.43 I could not agree with your comment more.
DeleteMore news not from SECU but definitely in the next place
DeleteIt probably was even WORSE than Reuters was reporting... "planned to understate loss" shows the intent to be dishonest, this reveals who you are ... and the Board allowed this person access to our money???
ReplyDeleteMUST have been something in it for them ....
@8:44 did this actually make the Reuters feeds
Delete"By Reuters Staff
DeleteWASHINGTON, April 10, 2009 (Reuters) '
taken from above ...
I want to know where every red cent went while Hayes was here. And to whom.
ReplyDeleteEvery single vendor SECU paid during Hayes's tenure should be investigated. Specifically, their connections to leadership and the board. What did SECU leaders get from each of these relationships. Itemized.
DeleteAnd, do not sign ANOTHER contract until we see that!
DeleteWas Mike Lord ever a fan of Hayes? Did he recommend him?
ReplyDeleteNo and No
DeleteLet's rephrase it as did Mike Lord told about his replacement beforehand and did the board ask for his opinion?
DeleteMike Lord had zero part in hiring the crook, Jim Hayes. This board has FAILED the SECU employees and membership! They are to blame 100%. No one else.
DeleteSpeaking of crooks. Google search "Chris Ayers Duke coal ash".
DeleteBOD went their OWN way on hiring Hayes. Don't say Mike Lord's name in the same breath with that other one. All of this BOD and 6 (imagine hiring a CEO with a split like that!!?What were they thinking?) own hiring Hayes. Mike Lord had nothing to do with it.
ReplyDeleteWho recommended the NYC search firm that NCSECU used to "vet"(what a joke) the candidates? How many search firms were considered? Did the BOD select the firm or did the Chairman? Bet there are some interesting connections in that process... Wonder if there was a vote and what that vote was? Why is this volunteer BOD so entrenched in silence and obfuscation? among lots of other undesirable qualities?!
ReplyDeleteWhy were all SECU candidates not allowed an interview for the position? Sounds like This Board was more certain of who they would not allow become CEO than who was best for the position. And in that simple act, they failed the credit union and the membership. We will accept your resignations now please.
DeleteFlyers will be disturbed across the state regarding the BOD. So be prepared, BOD. I hope you read this. It’s not something we want to happen, but if things don’t go back to the way they was…be prepared for a campaign against the Board of Directors. Not just on a blog or social media.
Deleteif you rob a branch and are caught, chances are you will go to prison ...
ReplyDeleteNo way, Mr Lord would have never recommended Jim Hayes! Everyone needs to remember, there is something or someone(s)still very much in play which may have contributed to bringing all this turbulence to SECU's door. An effort from within that was started in the last couple years of Mr. Lord's administration. If the last two years has shown anything, SECU's mission, culture and philosophy must be protected. SECU - a true not-for -profit; born in 1937; only to profit our member's lives.
ReplyDeleteThis Board needs to resign already - no point dragging it out till October.
ReplyDeleteCan the membership "this Board" for negligence in the amount of approximately 3 billion? That's what was lost.
ReplyDeleteSo what exactly needs to happen to replace the BOD? Wait until voting opens ? Horrible way to disrupt SECUs mission
ReplyDeleteevery candidate has to get 500 signatures from NCSECU members to run. and that's I think 500 different members. They want one member not to support three different people? Which sounds absolutely wrong.... I guess we will be educated on how to defeat "this Board" with their rigged election process. think they thought no one would notice. 10 days also and they rigged that so 4 days are weekends. So really just 6 days. sheesh
DeleteThanks. Are they going to publicize the count? How would anyone know?
DeleteIs no one going to share this on CU threads or LinkedIn
ReplyDeleteIf the vote as 6 to 5, it would be good to know who the 6 are.
ReplyDelete@12.22 agreed. Can someone provide names of the 6 board members who voted to completely dismantle our tried and true SECU?
Deletelet us enumerate the horrors inflected upon a well-run machine(NCSECU) by "this board".
ReplyDeleteThe very worst actions taken by this Board that has twenty stars and asteRISKs beside it, in a category of its own:
Shirking of fiduciary duty by mismanagement of the members' money.
Low interest rates,
high loan rates, and most of all,
RISK BASED LENDING
excessive growth of administration and
excessive shrinking of local staff and autonomy
1)Hiring NYC search firm.
2) No vetting by said firm or BOD of candidates
3)Shoving Mike Lord to the side in process
4) Hiring Jim Hayes, a known destructive, idiot in the
credit union industry.
5)the "no formal proposal" to merge with LGFCU--which was illegal! and NCSECU bod had lawyers on the bod!
6) pursuit of business and commercial lending. also illegal
7)Pursuit of open field of membership--also illegal.
8) Write and push H410 to legally allow all the above.
9) Lie, lie, lie about SECU's inhouse, software that protected the members money and accounts! (Nothing since 1983!!!)
10)Do away with "Every member WILL talk to an employee when they call. NO automated push button menus."
11) senior management working remotely. (Head of the Audit Department lives in Maryland--from Andrews)
12) Gutted the internal audit. Burn the internal audit books (we know why Hayes and this board didn't want a good audit department. Some one might find the dirt)
13) Investing the members' money in risky securities.
14) lie, lie, lie about all the above. What wasn't lied about was misrepresented.
This is only a little bit of what Hayes and this Board have done to completely dismantle and remake the NCSECU into any other financial institution, except more poorly run. Please add on to these . There are many others. ----This Board needs to have things spelled out in simple language that they can understand.
Agreed. They also continue to blame old systems and archaic ways of doing business not truly understanding that what works works. We (SECU) grew to $50b organically without the lavish PenFed or Navy Fed business style.
DeleteThis CU and COOP are owned by members not the CEO or the BOD. Keep what works and enhance gradually.
They did not need to publicize or blame prior administrations for the lack of modernization. Hayes you and the BOD weren’t here when we grew to $50B and into the 2nd largest CU.
Heck we just did what we normally do and that’s just serving members . SERVING MEMBERS . Not EGOs to try to prove a point .
Probably need to stop with the whole 6 - 5 thing. At least 2 of the 5 are no longer on the Board. And more importantly all 11 actually signed the 5/26 email to all employees stating their support for Hayes and the process that hired him. Every single one of them has to go. No turning back, their ineptitude and malfeasance cannot go unaddressed. For a fresh start the whole Board should resign Tuesday, in the best interest of the members and the employees. Short term chaos for long term stability.
ReplyDeleteYou are correct. No one on bod has objected or refused to sign that letter.
Deleteexactly, when you operate you have to get all the cancer out!
DeleteSo what exactly is the story on Internal Audit? Was it gutted to bring in Hayes’ people?? Was there anything wrong with internal audit to begin with?
ReplyDeleteSECU had the most unique and effective audit process in the nation. A branch audit performed by an audit staff that rotated in from the branches for 2 to 4 years, and senior managers active in the branch network. A highly effective peer review. Carl Seabrook, Hayes' buddy brought in from Andrews CU, did away with all that - he instituted "industry standard" just like others brought in have done. Hey, the these new guys make every effort to be mediocre.
DeleteAnd don't forget Hayes, on a statewide conference call, encouraged staff to burn their Audit Manuals. Now I guess we know why.
How about industry standard isn’t always best as we all know. We didn’t get to where we are because we did what everyone else did, but guess you have to have a little common sense to figure that out….
DeleteWell we all know where “industry standard” has gotten us…..$3 billion in the hole. Must be why we need to burn those audit manuals so we forget what honesty looks like.
Delete