Will let you read and judge the following email information for yourself. Would say that although I do not know the true identity of the sender of the information, I can verify for you that the source articles and publications are entirely legitimate (you may not be able to read entire article without a subscription. Will try to get full copies and post.).
Would also note that the financial debacle caused by the failure of Wescorp in 2009/2010 (a $6 billion insolvency!) is well known to "legacy" employees at SECU - and to every CU in the U.S. - who had to deal with the economic fallout. In fact, former SECU CEO Mike Lord was the chief financial officer at SECU when the Wescorp collapse occurred.
As I understand it, Mr. Lord was not, shall we say, amused, when current Chairman Chris "Mr. NFPP*" Ayers - with this "strategic move" - led a divided Board to the precipice, and then "bungy jumped" SECU, its staff, and its membership into the abyss...
Better pour yourself a strong one before proceeding... you may not need to hold your breath, but you'll certainly want to hold your nose!
✔ Incoming Email 5/14/2023
Jim,
Are you familiar with Hayes' past as CFO of
WesCorp? And all the shadiness around underreporting of losses, the
federal lawsuits, the c-suite corruption, etc? If not, I can expand and
provide some news articles and other sources.
✔ Reply Email 5/16/2023
Have limited knowledge of Mr. Hayes, have never met him, have little insight into his personality, capabilities, and detailed work history.
So
yes, more precise info would be helpful...always a lot of snarking
about any CEO, so facts/references help more than plain old
disgruntlement.
Thank you. Sorry for the delay in response.
✔ Incoming Email 5/17/2023
Cool! Apologies if any of this is redundant, obviously I'm not aware of
what you do or don't know (vis-a-vis Wescorp), and don't want to leave
anything out. I've put links to sources throughout my email. If it's in
bold, it's a link.
First, per Hayes' Linkedin page, he was Chief Financial Officer of WescMr. orp from April 2008 to October 2010.
This article corroborates that timeline.
Western Bridge Corporate Federal Credit Union, aka Wescorp, was a
corporate credit union with $23 billion in assets. At the end of March 2009, about a year after Hayes became CFO,
NCUA placed Wescorp into conservatorship,
removing their board of directors and CEO. Somehow, Hayes survived that
purge and remained with WesCorp for another year. It was ultimately
dissolved in 2012. I could be wrong but I believe I read somewhere that
in terms of assets, it's the largest failure of a credit union in US
history.
The credit union was severely mismanaged, and was over-leveraged with poor investments. James (Jim) Hayes was named as
one of the defendants in a lawsuit after the credit union's failure. The lawsuit alleged
neglience and breach of fiduciary duty
(sound familiar?). The suit specifically addressed their 2008 and 2009
investment losses - when Hayes was CFO. An interesting tidbit from the
page I just linked:
"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."
Speaking of deception, here's an interesting article. Your
recent blog post about the SECU financial report reminded me of this.
Obfuscation and deception is the name of the game with Hayes.
Here's another article mentioning the lawsuit, which refers to him as Jim Hayes, rather than James (just in case there was any doubt).
I
can't find it now - it may actually be mentioned in one of the links
above - but when doing research on this before, I noted a section that
said that part of the reason they were being sued was because the
c-suite executives had changed employee benefit packages at the credit
union to enrich themselves at the expense of the regular employees. Big
time levels of corruption at the executive level.
This
is a running theme with Jim Hayes. I leafed through some employee reviews
from his time at Andrews Federal, and a lot of the employees expressed a
concern of c-suite corruption. (But that's not something that I have
evidence for. I haven't researched his time at Andrews that much. Might
be worthwhile to explore further?).
The
point is, Hayes has already been closely involved in the failure of a
large, multi-billion dollar credit union, and if you read through these
sources, it all sounds eerily familiar to what is being done at SECU
now, as well as what they're planning to do in future (particularly in a
world where H410 passes). I do not believe, with Hayes in charge, that
SECU is too big to fail.
It's possible you, or people
you know, are smarter than me and can dig a little deeper into his
history to find more juicy information. But clearly something stinks
here.
Lemme know what you think! Is this a big nothingburger?
✔Second Incoming Email 5/17/2023
Here's the thing I said I couldn't find. I found it. I didn't fully remember the details:
https://www.latimes.com/archives/la-xpm-2010-sep-02-la-fi-credit-union-20100902-story.html
It
doesn't directly mention Hayes, but he was CFO at the time of this
happening. Is this not something that would have gone across his desk?
Maybe not; I don't know how things work at the C-suite level. (That's
why I thought it would be worthwhile to reach out to you!)
"The
defendants accused of fraud are Robert A. Siravo, who was WesCorp’s
chief executive, and Thomas E. Swedberg, who was vice president of human
relations. Reached by phone Wednesday, they declined to comment on the
case.
The
lawsuit says improper changes were made to WesCorp’s retirement plan
for executives, causing the credit union to pay Siravo $6.8 million in
May 2008 instead of the $4.5 million he would have received under the
original terms of the plan.
Swedberg
received more than $1.2 million in January 2009 rather than the
$535,000 he would have received if the plan had not been changed, the
lawsuit alleged."
... can't wait to hear a little "Fireside Chat spin" from Chairman Ayers and the SECU Board on this one.
*"NFPP" - the Ayers "no formal proposal proposal" (to merge LGFCU)
