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Wednesday, August 26, 2009

Money is No Object


Over the past two weeks, Priority One Credit Union's President, Charles R. Wiggington, Sr. has disclosed that he is aggressively implementing corrective actions needed to taper and eventually stop the credit union's ongoing financial losses. He describes three areas where he is targeting his efforts. These are:

  • Identifying key causes for financial loss
  • Resolving issues plaguing employee morale
  • Reducing account closures
During May's annual meeting, he attributed the cause for the credit union's financial losses to the state of the national economy and California's high unemployment rate, both factors which he not only identified but if true, he doesn't possess the ability to resolve.

He is the single-most contributor to the decay of employee morale at the credit union. Unless he's gong to undergo a dramatic change in conduct, his alleged efforts to resolve this will fail.

On January 4, 2007, he announced that he would be implementing a retention program which would  reduce account closures. He described a plan which would appoint one or two employees who would intercede and speak to members who request closing their accounts and offer them incentives to retain their membership. To date, his retention program had yet to be implemented and based on his history of procrastination, don't expect it be realized at anytime in the near future. 

It's not only non-exempt staff who have grown tired of the President's failing business decisions and abhorrent personal behaviors. There has been growing dissension within the managerial sector, with some managers becoming more vocal about the President's leadership style and some have expressed a reluctance to comply with his directives. 

The President is a man who knows nothing about creating effective strategies, almost always relying on what he believes to be true. Three weeks ago he ordered that the Real Estate Manager be issued a written warning for disagreeing with his plan to depart from standard real estate loan procedures;

He has also increasingly criticized CFO, Manny Gaitmaitan, for refusing to manipulate financial reporting to create the impression of reduced losses and increased profits. And though President Wiggington has frequently expressed his disdain for gossip, he continues to be the credit union's biggest gossiper and adversary to business and morale.  


On August 18th, Priority One Credit Union's President, Charles R. Wiggington, Sr., issued yet another statement, assuring members that he is doing everything to resolve the problems that have caused Priority One's dramatic decline and in particular, a drop of its Net Income, Net Capital and what appears to be growing disinterest in its financial products and services. Excerpts from his statements are shown below:

"The past months, including July brought many challenges for the credit union. Our net capital decreased 0.61% to 6.35%, due to computations made on our mortgage loan modifications."

 "Every effort is being made to control delinquencies. However, we currently have $,338,509.26 in delinquent mortgages which represents 78% of our total delinquency. Loans decreased by $419,259.67 and shares decreased by $1,211,480.69. Our total membership decreased for the first time since the inception of shared branching by 35." 

"The decrease in membership is mainly due to dormant account closures. The total amount approved for loan modifications were $1,252,786.30, which includes three first mortgages totaling $1,133,623.63." 

"We will also continue to aggressively control operating expenses in all areas. Our focus is to control dividend expense and generate greater income." 


The simplest explanation for the credit union's decline in Net Capital is a lack of new business and over-spending by President Wiggington. 

The President has failed to create strategies that produce the amount of profits needed to offset overhead. He often blames the national economy and claims "all credit unions are losing money." His statement is of course untrue and is a gross generalization. A search of the Financial Performance Reports ("FPR's") on the NCUA's website for other credit unions reveals that in spite of the national economy, some credit unions have grown and are thriving. Of course, the leaders of those organizations quickly responded to the challenges which arose when the national economy suffered and found through their diligence, ways of re-inventing how their organizations do business. Not so at Priority One where the President is lazy, incompetent, and more immersed in gossip and creating internal discord than he is in developing business. 

President Wiggington's most frequent complaint is that real estate loans don't have a quick turn around time, forcing Priority One to wait for years, sometimes decades, before a real estate loan is paid-off. Though his statement is true, it is rather conspicuous that this only became an issue after he became President on January 1, 2007. 

Prior to his appointment, his predecessor developed and offered seasonal loans which created a reliable stream of income, but in January 2007, Charles R. Wiggington, Sr. ended all seasonal loans because in his words, "I don't want anything my predecessor developed." Not only is his statement inane, it is psychologically disturbing and suggests that the root of the credit union's financial troubles are rooted in the President's emotional state. 

The President is again, not being forthright. The decrease in membership is due to increased account closures. The most frequent reason provided by members closing their accounts is "poor service." That has absolutely nothing to do with the subject of dormant accounts. 

However, the procedure of closing dormant accounts was in place long before Charles R. Wiggington. Sr. was appointed President but when he became President in 2007, he intentionally neglected closing long-standing dormant accounts. His excuse: "[Dorman accounts] make it look like we've got more members." Yes, it does create the false impression the credit union has a large sector of members but Dormant accounts belong to members who are actively participating in what the credit union has to offer, thus making them inconsequential to new business. The problem with President Wiggington is he has never developed a single strategy that tries to convert dormant account holders into active participants of the credit union. 


President Wiggington has had more than 2 years in which to implement aggressive controls over operating expenses and he's done absolutely nothing about doing so. However, the reason operating expenses are a problem is because of his failure to implement methodologies that develop business, generate profit and increase membership. Every business has operating expenses and every business should control unnecessary business but why is it that his predecessor had no issues with operating expenses while under President Wiggington, these have become a critical problem? 

President Wiggington talks and talks and talks, continually repeating the same empty assurances and never achieving his supposed goals for the credit union. So is the problem the national economy, operating expenses or President Wiggington? You know the answer. 


The following paragraph appeared in our last post. 

"Recently, Mr. Wiggington, Sr. confided that a member of the LAPDC reported that her CD had been closed and reopened in a lesser amount. This prompted an audit which verified this to be true and which has shown that approximately $6000 were embezzled by the employee transacting opening, closure, and reopening of the CD." 

The audit was conducted by Turner, Warner, Hwang, and Conrad, Priority One's contracted external auditors. The investigation took place over a three-week period  and has now been completed and found that tens of thousands of dollars were embezzled by a former receptionist assigned to that location. 


Prior to January 1, 2007, the date Charles R. Wiggington, Sr. began his appointment to President, Priority One's Net Income approximated $172 million. 

As reported in our last post, from January 1st to July 31st, 2009, Priority One's Net Income decreased by $4,003,555.89

In a it's financial statement to the Board of Directors, the President provides the following actuarials:

WesCorp write-down of Capital Permanent Capital Shares:

Increase in Allowance for Loan Loss account:

Increase in Allowance for Loan Loss account:

NCUSIF Initial Adjustment 1% to 1.3% of Insured Shares:

Year-to-Date Net Operating Loss:

Other information contained in the report, cites that:

  • Delinquency Ratio increased from 4.18% to 4.86%
  • Delinquencies increased from $4,789,226.74 to $5,544.909.06
  • Net Charge-Off ratio improved slightly, reducing from 2.64% to 2.68%
  • Return on Average Assests (ROA) declined from -2.62% to -2.65%
  • The Net Capital Ratio decreased from 6.96% to 6.35%*
*Undivided earnings of $7,575.844.62 plus Regular Reserve of $5,128,606.33 plus Allowance for Loan Losses -$2,600,000.00 minus Classified Loans of $3,737,003.00 divided by Total Net Income in the amount of $182,201,537.08.

The President also states that the unpaid balance of "$10 million" from the loan obtained in mid-2008 from the credit union's line-of-credit, will be paid in full sometime in September. Payment of the loan will reduce "Net Income by $10 million and will increase Net Capital from 6.35% to 6.72%.

Based on the President's statement to the Board, the loan of $20 million may have increased the amount of Net Income on paper but it contributed to the decline in Net Capital while burdening the credit union with an exorbitant and completely, unnecessary expense. 


Earlier today, President Wiggington met with the Board of Directors to discuss the credit union's present financial standing but his spiel that paying off the remaining $10 million balance of the loan he borrowed in 2008, may soon improve the credit union's lagging performance, was not met with the enthusiasm he had expected. 

Despite his assurances that business is about to undergo a dramatic improvement, even the ignorant Directors seemed unable that this is the same sales pitch he's used since 2007 and each month, the credit union seems more and more immersed in financial issues. 

Though apparently not entirely persuaded by the Board, its Chair, Diedra Harris-Brooks not to hold the President entirely accountable for the credit union's problems and took a moment to  point fingers at long-time CFO, Manny Gaimaitan, who they labeled "uncooperative" and who the President accused of not possessing the ability to understand the President's "vision" for the credit union.

Following years of employment, the CFO has suddenly lost his comprehension skills. What's more, he lacks the ability to comprehend the President's "vision." What the CFO may not understand are President Wiggington's "hallucinations." 


Historically, Charles R. Wiggington, Sr. finds scapegoats.who he promptly victimizes and blames for his many inept business decisions. The CFO has officially become his latest victims. The CFO, who loyally served former President, William E. Harris, and whose abilities were never scrutinized or berated, has now become the latest target of the highly flawed President's aspersions. 

In 2007, after refusing to carryout security procedures which resulted in the mailing of ballots in envelopes on whose exterior were printed member credit union account and social security numbers, President Wiggington quickly placed the blame on the then IT Supervisor though the supervisor had absolutely no involvement in the security breach. 

Since 2007, President Wiggington has refused to market business in Riverside County resulting in rampant account closures at the Redlands and Riverside branches. The President has typically leveled all blame on his predecessor, accusing the retired President of orchestrating a bad merger which he says has created a "mess" for him. 

Though prior to the date of his appointment to President, the Marketing Department was the recipient of annual industry awards, in 2008, the President blamed the department's former Director stating that she somehow and inexplicably created problems that have caused the credit union to lose the ability to generate new business. The President, of course, fails to cite anything that proves that she is the cause of business problems that coincidentally started on the day he became President. Who would the President blame if he were the only living survivor on planet Earth? 


And though President Wiggington has been insisting he is reducing spending, "streamling" and "working smarter", so many of his cost cutting decisions are constantly being offset by spending- spending orchestrated by him.

His implemented wage freeze has had its most profound effect upon employee salaries, while he and his executive staff have been exempted from receiving annual raises and bonuses.

The President with the help of AVP, Rodger Smock, who is also the Director of Human Resources, has again  violated law and has ordered that many employees work outside their job classifications. This is illegal under California labor laws.

He also has ordered that many part-time employees work 40-hours per week without receiving benefits allotted to full-time staff.

The President's campaign to reduce spending was recently counteracted by his decision to hire t he consulting firm of Lillestrand and Associtates  The firm was highly recommended by COO, Beatrice Walker, who describes them as reputable and as a firm she worked with previously while employed at another credit union. According to their website, the firm promises to  "squeeze every drop of performance improvement possible from the [effects of the] current [economic] "catastrophe."  

The firm touts itself as staff development specialists and according to their website,  "In the new information economy, people are the new capital. You can select from a wide menu of over two dozen insightful and effective developmental workshops to help enhance your team’s job satisfaction and work effectiveness."

On August 18th, owner and consultant, Loren Lillestrand, visited the South Pasadena branch and over the next 2 days, met with groups of employees who were administered tests to determine their personality types. 

When testing was completed, Mr. Lillestrand informed employees that the tests would be used to determine the "likes" and "dislikes" of each person. These would be used to place them in positions where they would most benefit the credit union while allowing them to enjoy their work. So was Mr. Lillestrand hired to assess employee strengths and preferences or was he hired to help President Wiggington identify which employees were dissatisfied with the President's mode of administration so that they could be targeted, branded, and driven out of the credit union?  

After each meeting, Mr. Lillestrand met with individual employees whose names were provided by President Wiggington and AVP, Rodger Smock. So why would the President in the midst of expense reductions, hire Mr.Lillestrand's firm? Not only did the President approve the hiring of Lillestrand and Associates but also contacted Jeff Call of Focus, a company whose services include employee coaching, management development and specialists in helping forge strategies that create effective marketing. Their website is located at .

So where has the President found the financial resources needed to hire expensive consultants? Based on the areas where he's introduced expense reductions, the source may be money saved as a result of the wage freeze implemented over non-exempt staff salaries. 

During what the President boasted as a strategizing two-day session, the President ordered catered food service, again bringing into scrutiny his so-called cut-backs in spending. It of course never occurred to the obnoxious President that a positive affirmations to his efforts to reduce spending would have been set if Directors, Supervisors and other officers had purchased their own food and beverages. 


Contrary to the President's 2008 assurances that his then new phone system would resolve all service issues and avoid creation of a Call Center, COO, Beatrice Walker, recently convinced the Board that what Priority One most needs is a Call Center. Ms. Walker has disclosed that the Call Center will serve as an "all-stop center" and will enhance service by providing nothing less than stellar member service. Does this mean that Charles R. Wiggington, Sr. wasted $600,000 on a telephone system that may prove obsolete if and when the Call Center is created? 

The failed telephone system was purchased and implemented without the President first conducting a careful study to show its feasibility to meet the credit union's needs. Its technical issues further intensified the credit union's member service issues which heightened Priority One's already debilitated relationship to its membership.

So how much will the credit union now spend to build a Call Center? Ms. Walker has disclosed that the credit union will have to purchase equipment and software needed to carryout the center's functions along with purchasing new furniture and telephones. The credit union will also have to hire a staff for the center and procedures and policies will have to be written for the new addition. The credit union will also have to implement and emergency back-up plan and create a schematic to ensure everything functions as planned.   

Net Income and Net Capital have declined. In response, President Wiggington has implemented drastic expense reductions. At the same time, he's now committed the credit union into entering some highly expensive enterprises. All the while, the biggest impact of spending cut-backs is the effect the President's wage freeze is having upon non-exempt staff, the same people who do the work of the credit union. The President has also found a new scapegoat in CFO, Manny Gaitmaitan, who according Charles R. Wiggington, Sr. is difficult, uncooperative, and unable to understand the President's vision which we think is a reference to his special brand of delusions that drive his abysmal business decisions and abhorrent personal behaviors. So what the future hold for the formerly prospering credit union? Well, we don't foresee success in Priority One's future and we think its safe to say, this is one organization that isn't going to experience future growth. 

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Anonymous said...

The Anonymous Voyeur would like to point out that dormant account closures may either be (1) closed to provide fee income to the credit union [too small of an account to maintain profitably, say less than $7.00 or so] or (2) required by State law with the money being paid over to the State where it is held in trust for the eventual claimant to come forward at some future date.

Call centers are expensive to setup and operate. The call center staff will require more skills than the average teller since the call center is usually designed to sell and cross sell products and services. Based on prior comments by others, it seem rather unlikely to me that the current P1 staff is up to the task.

So much for planning and financial controls.

Archie said...

I knew it, I knew it, I knew it. Every so often Wiggington tells us we've improved. I don't know where you got his quotes but obviously he's been lying to a lot us. Some of us don't want to believe some of what we read but I am so tired of him. He has ruined everything and it doesn't seem he's going to stop any time soon.

Beatrice is in charge of planning the Call Center. She has Call Center experience but I just talked to someone who used work with her and she told me Beatrice isn't so wonderful and makes lots and lots of mistakes. Not only did she cause Honda a big loss but she was fired by another CU because the CEO thought she was useless. Now she's in charge of taking more money from P1 to build something they can't afford. The Call center is another nail in P1's coffin.

Anonymous said...

What are the COO's qualifications? Being the manager of a Call Center does not mean that you know how to build one. I visite one web site, and it takes a lot of planning. When do they plan to have this thing set up? Its already August going into September. Are they planning going online in 2009? If they are then they are dumber than they already look and just like everything Wigg does it will be rushed and wrong.

Anonymous said...

The Anonymous Voyeur looked at the calender and thought that 2010 looks like a more reasonable time to launch. As two others have commented, planning is the key to a good launch. From what I have read about the train wreck called P1, I don't think is anything they do well.

Of course, the call center will have to be integrated into the famous or infamous P1 phone system. How easy will that be?

Admiral Perry said...

AT & T were out again recently (that's 3 times in 6 months). Each time they hang out for a while and after they leave the phone system remains the same. If as anonymous wrote the call center will have to be integrated into the P1's phone system then we can expect more failure. Wiggington doesn't have the brains to plan anything and the COO who has supposedly worked in a call center may not understand the technical side. If history proves true maybe we should get more buckets to scoop out the water that's filling P1.

Anonymous said...

I can't figure out how they keep cutting expenses while spending even more money. New COO, consultants, a new training room, furniture of the COO's office, paying for food for meetings with the board, trips for Wigg and the COO....and now a new call center. What the hells going on?

Anonymous said...

The call center is another failure waiting to happen. Wonder who wiggs is going to blame when the center goes up in flames like the rest of his ideals.

Anonymous said...

Oh great, a person that use to work with the COO said "she isn't so wonderful and makes lots and lots of mistakes. Not only did she cause Honda a big loss but she was fired by another CU because the CEO thought she was useless". Way to go helping the credit union Mr. Dumb Ass CEO. Thanks for adding this loser to a sinking ship.

Anonymous said...


Anonymous said...

The Anonymous Voyeur had a late night thought. Instead of running the call center's phone system through the P1 switchboard, the P1 brain trust and their consultants, Larry, Moe, and Curly, will get a 1-800 phone number that will be separate and obviously more expensive for the call center.


Account Clerk said...

I read the NCUA report and all I see is negative. Cut-backs and lots of accounts closing. I mean it all says loss but where is Wigg getting all the money to spend and spend and spend?

Anonymous said...

Anonymous, Wigg is able to spend money not paying employees for their job classes,not giving them raises, and cutting where employees lose.

Anonymous said...

I just found this web site and was truly amazed at was is happening at P1 and that the board is not performing their judicatory duty to protect the Members and the credit union, it is the responsibility of the board to uphold the policy and producers of the credit union and above all the dignity of the CEO of the credit union. It’s very shocking to see that none of this has happen and that the board has allowed this disgrace to happen to a once outstanding credit union under the guidance of Mr. Harris who has a solid reputation in the credit union industry.

The membership needs to be informed about what is happening at P1 and you can start a petition to not only have the CEO remove but also the board of directors who are not doing their job. Derider the chairperson needs to be removed as she seems to be controlling and is protecting a CEO who is not honest and seem to have a problem with his mouth.

Can the board honestly want a CEO who has created a horrible image for the credit union and is the laughing stock of the industry. I attend a meeting where this blog was a major discussion, and everyone who knew this Wiggington person agree with how the blog has depict him and that is not good.
The board of directors needs to see themselves as others see them, is the board getting kick backs or special rates, or did they also get a car from a member who could not afford to pay there car? That’s what the talk is! What is the board at P1 getting for allowing this CEO to destroy a once outstanding credit union and if they have not called Mr. Harris back why not?

Anonymous said...

Anonymous, if employees sign a petition who do they give it to? It can't be the board because they'll sit on it just like they have with everything he does that is illegal. The supervisor committee is also useless and if the dfi has read this, they don't seem to be doing anything. I think employee would sign the petition if they knew it was going to someone who is not the board or supervisor committee.

Anonymous said...

This week Wigg has been on vacation and the office seems happier. It is so sad that one man can make people so miserable.

Anonymous said...

The Board and Supervisory Committee are all idiots. I dont care how much wiggs talks they should take a look at whats in front of them in black and white.

Anonymous said...

The board is made up of the uneducated though Diedra took a class at Phoenix Univ because she couldn't get into Harvard.

Anonymous said...

Porch monkeys.

Anonymous said...

If you're serious about getting an employee signed petition going you could send it to the local CA Department of Financial Institutions office:

300 S. Spring Street Los Angeles, CA 94111

You should cite factual abuses and ask that the DFI open an investigation immediately. Someone will have to include their return address because the DFI will not respond to an anonymous letter. Good luck and remember stick to the facts....just because Wig smells and scratches you know where is not reason to open an investigation.. .although it should be.

Anonymous said...

Your COO came to P1 with a reputation and not a good one. She's not quite the professional they want you to believe she is and she has a lot of failures behind her. Watch her, she'll mess up soon enough. Wish she wouldn't but she will she always does. And watch her carefullyy she's got attitude.

Anonymous said...

There is evidence and there are witnesses, the problems is employees can't afford losing their jobs and anyone who knows Wigg knows he has no problem destroying people or their livelihoods. In fact he actually gets off on it.

Anonymous said...

Delinquencies went up again. Its so sad. I can't believe Wiggington opend the door to the problems P1 now has. Whats worse is the Board thought protecting him was good all because they think black is superior and the only color for P1. Really sad.

Anonymous said...

Just keep the petition secret...even arrange to have those you know will sign it meet after work somewhere. Employees can sue if they are fired in retaliation for signing the petition under the federal whistle-blower's a law passed specifically to protect employees who expose criminal wrong doing at a company. And regarding their jobs, at the rate P1 is going, most will likely be seeking employment elsewhere in the next 6-8 months anyway because ol P! is so on life support...god, someone should just pull the plug!

Really Pissed said...

Today my supervisor told me that Bea is offering any employee an opportunity to take a personal 3-4 month leave WITHOUT PAY!

Supposedly, this gives people an opportunity to do something they migh want to do but can't because they have to work. Really! How do you do something you want to do without money?

Bea supposed said that they are offering this before the cu has to lay people off. If you get laid off you can get unemployment can't you? What A-holes! They f up everything and employees have to pay. Wiggington got suspended and cost the cu a lot of money for the investigation. Wiggington buys a useless phone system but that's okay because if anything goes wrong and it did, employees can pay for it.

He steals a members car but doesn't get in trouble. He is an embarassment and they should have fired his lazy fat ass a long time ago but they didn't because the black board says P1 needs a black president.

Now the employees are asked to give up even more though this time it means leaving the cu without pay. They even suggested that people can go to school and take a class. Why don't they go to school and take a class on management?

And if you want to cut costs where it really counts why don't Bea and Rodger offer to take a 20-40% cut in pay?

You want to save even more money fire that lazy fat ass president and get rid of his embarassing ass from the cu so no one has to suffer with him again. He is the most hated man at P1 and is too stupid to know it. Problem is he isn't man enough to quite. What a loser!

Anonymous said...

Employees always have to clean up their bosses messes.

P1's nightmare said...

Wiggington's problems have only just begun...I will make it my personal duty to make sure his ass suffers the way he has made other ex- employees as well as employees suffer....

As a matter of fact management need to take a class in ethics amongst other things...

I hate Wiggington with all my soul and hope he rot in hell!!!

Anonymous said...

What a great ideal management has came up with. Asking staff to take off for 3 or 4 months with out pay. So we know why the coward (baldy) is not there. Looks like he cant look people in the eye as he stabs them in the back. He has messed over P1 so badly and now he doesnt want to be there when its going down in flames. If you really want to cut out the fat lets start at the very top. P1 is way too heavy with management. Half could go, watch out at the staff meeting.

Anonymous said...

Top heavy is right! You got the biggest idiot any credit union has ever seen pretending to be president, you have a senior vp who bends the rules because he prefers saving his ass than doing what is right and honest, and you have a coo the cu can't afford and who has a history of losing money (Honda CU) and being fired from another cu. Fire Wiggington and the other two should have their salaries cut by 30%. Diedra and her dummies should be kicked ass first out of the cu. Shame on every board member!

Anonymous said...

Now maybe everyone will realize just how good Mr. Harris' leadership of the credit union was.

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