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Thursday, February 20, 2014

So What Does the Future Hold for Priority One Credit Union, Part 2 of 2, February 2014

"We must add, that in our opinion, the Santa Clarita branch will close either at the end of this year or in 2015."

So, What Does the Future Hold for Priority One Credit Union , Part 1 of 1, January 20, 2014

Last month, based on our review of Priority One Credit Union's performance during the years, 2012 and 2013, we surmised the credit union would close its small, poorly performing Santa Clarita branch either, later this year or sometime in 2012. You can imagine our surprise to discover that only 11 days after publishing our statement, Priority One permanently closed the doors the Santa Clarita branch. The branch, which opened on February 2, 2012 and closed on January 31, 2014, brings an end to Priority One's presence in the Santa Clarita valley and serves as more evidence that something is horribly amiss at the credit union.

This was the second branch closed by Priority One since January 13, 2013, the date when it permanently closed the doors to its Airport branch. The last time the credit union closed two branches in a less than 60 day period, occurred in 2010 when Priority One closed the doors to its Redlands and Valencia branches. 

The closure of the Airport and Santa Clarita branches conspicuously undermine the President's December 2013 and January 2014 proclaiming that business is "great" and statements by Vice President, Patricia Loiacano, that business is "doing well." The evidence shows business is neither great nor remotely well reminding us that one should never believe anything Priority One's highest officers have to say proclaiming success of the credit union.  


Almost as pivotal as the closure of Airport and Santa Clarita branches is the February ouster of Priority One's Chief Financial Officer ("CFO"), Saeid Raad.  In 2010, President Wiggington boasted Mr. Raad "makes more money than me!" He also often referred to Mr. Raad as his friend, spending hours each week visiting the CFO in his office, during which the President would boast about his plans for the credit union, his business savvy, and gossip about people he terminated who failed to live up to his loft expectations. 

We happen to know Mr. Raad didn't earn as much money as the President. His annual income approximated $130,000 to $138,000 and though in the world of CFO's, the amount he received may not have been unreasonable or impressive, it was substantial pay at a credit union in rapid decline. 

Mr. Raad arrived at Priority One in 2010, via his associate and friend, former COO, Beatrice Walker.  Initially, Mr. Raad was hired on a contract basis but later in mid-2010, was offered a permanent position replacing former CFO, Manny Gaitmaitan who resigned in December 2009. 

So why was Mr. Raad dispatched from the credit union?  According to staff close to the President, there were several reasons for his removal. Mr. Raad was responsible for reporting accurate financial information needed by the credit union to make business decisions. We've been informed that some of his estimates, including those pertaining to the credit union's Net Income, allegedly over-estimated the amount of future profits. He allegedly failed to identify areas within the operation which had proven most efficient nor did he allegedly succeed in developing methodologies that allowed the credit union to capitalize on its strengths. He is also alleged to have failed to develop accurate forecasts of Priority One's financial future and allegedly failed to to identify areas in business were money was most generated which is needed to develop strategic planning that induces growth. 

In our January 20, 2014 post., we reported that at the end of 2013, the credit union's losses from investments exceeded $500,000 for the entire year. Following the departure of Manny Gaitmaitan in December 2009, the responsibility of determining investments was appointed to now former Accounting Manager, Jennifer Kelly. After Mr. Raad was appointed CFO, Ms. Kelly continued to manage investments. Last year, Ms. Kelly left the credit union and the task was understandably relegated to the CFO. Following our public disclosure that the credit union's were more than $500,000 in the negative, an incensed Board Chair, Diedra Harris-Brooks, allegedly contacted the President demanding an explanation for the losses. What we find peculiar is that as Board Chair, she was well aware of the losses before we published them on this blog. President Wiggington of course, shirked off all responsibility for the losses, attributing these to decisions made by Mr. Raad.  

As CFO, Mr. Raad was as pivotal as President Wiggington, in determining the credit union's financial future. During his brief stay at the credit union, Mr. Raad unlike his predecessor, Manny Gaitmaitan, complied with the President's and Board's every wish. In 2012, at the request of the President and due to increasing financial problems, Mr. Raad instructed the Accounting Department to not pay invoices for at least 3 to 4 weeks after they were received. 

During 2013, when President Wiggington reduced his work hours from 40 to 8 to 16 hours per week, Mr. Raad along with Executive Vice President, Rodger Smock, and Vice President, Yvonne Boutte, inherited his responsibilities. Like his predecessors, Beatrice Walker and Cindy Garvin, Mr. Raad allegedly grew dissatisfied with President Wiggington's mode of governance which may have also contributed to the CFO's ultimate ouster. 

Since 2013, we learned that President Wiggington had told several long-time members of the credit union and representatives of other credit unions that the credit union's decline was caused by insurmountable problems he inherited from his predecessor. The President's ploy is to weave yet another preposterous excuse to escape culpability for what he alone caused. President Wiggington is a man devoid of self-discipline and emotional maturity and who will do all in his limited power to dodge blame for the reverberations born out of his ill-conceived ideas. His excuse, for that is all it is, is both untrue and blatantly absurd. 

On January 1, 2007, the day President Wiggington officially began serving as President, the credit union's Net Income approximated $172 million and it had 9 branches. Its territories extended from Santa Clarita and south to Riverside county. During the first half of 2007, the President traversed the halls and departments of the main branch, loudly declaring his intents to transform Priority One into a state-of-the art credit union that would rival larger, richer credit unions by offered the latest technologies needed to deliver convenience and simply the home banking experience.  Clearly, he would never have boasted about is plans had he inherited a credit union riddled with internal problems. The real issue lies in the fact that Charles R. Wiggington, Sr. was unqualified to lead the credit union. It is this deficiency which led to Priority One's rapid and well-documented decline. We're surprised he hasn't blamed his dog, the Loch Ness Monster or his son, who in 2013 was convicted for selling methamphetamines. 

Unlike President Wiggington, his predecessor was a respected leader in the industry. While President, he compiled an impressive record of success. Under his leadership, Priority One entered into mergers which expanded the credit union's holdings, generated new membership and increased the credit union's Net Income. Under his predecessor, the credit union was able to offer a variety of real estate products and maintained an impressive and growing portfolio. 

In contrast, since his appointment to President, Priority One can no longer service its vast territories forcing it to promote increased use of home banking and Shared Branching. The once impressive array of real estate mortgage loans has been reduced to HELOC.s The credit union's Net Income has plummeted from a $172 million to  $146,318,298 (as of 12/31/2013) and it has closed 6 of 9 branches since October 2010. 

Charles R. Wiggington's legacy is his single-handed unraveling of a once outstanding and promising credit union. He has earned a well-deserved reputation for being slothful and inept. Over the years, he has proven he lacks an understanding of marketing, advertising, and member and employee relations. Over the years, he has demonstrated a propensity for gossip, dishonesty, scandal and wasting of the credit union's valuable resources. With only 3 branches left and efforts to jump start business continuing to fail,  it is highly possible Priority One will be forced to close another of its remaining branches, sometime in the not-to-distant future. The President's stories designed to escape accountability should be viewed as mere childish jabber from a man whose mode of administration is characterized by far flung fiascos.  

The former Airport and Santa Clarita branches were located on U.S. Postal Service properties. The amount spent by the credit union to lease each space was $1.00 per year. In 2013 the credit union received notice the New Post Master in Santa Clarita had decided to increase the amount of the lease for the space located just outside the Santa Clarita Mail Processing plant. Executive Vice President, Rodger Smock, exclaimed, "I can't believe what the post office has done to us." We don't think the post master's decision to increase the amount paid by the credit union was either personal or emotional and merely constituted a sound business decision. Evidently, raising the amount paid to lease the Santa Clarita space was more than Priority One could afford.

Over the year, the President enters into campaigns to tout the credit union's success. In 2011, he visited all branches and told employees that business had improved. In January 2012, during an all-staff meeting conducted in South Pasadena, he again declared a resurgence of business. However, on February 2, 2012, he announced that unless large amounts of new business were obtained immediately, he would be forced to close the Burbank branch. What he didn't tell employees was that he had already notified the property management company overseeing the Burbank office and informed them the credit union would either close in April or May of that year. During the months of February through August 2012, a large number of employees were terminated for failing to attain their assigned monthly sales quotas though the real reason for their termination was an emergent need to reduce expenditures. 

Historically, President Wiggington and his executive staff rely heavily on distorting the truth as a means by which to camouflage failures and hide indiscretions. In January 2010, the President and his then COO informed employees that the credit union had turned a profit despite having ended 2009 more than $500,000 in the RED. On month later, in February 2010, it was revealed that the President transferred funds from a general ledger and reported them as profit, when no actual profit had been generated.

Last December, following closure of the Airport branch, the President declared that business was doing "great" while Vice President, Patricia Loiacano, disclosed that business was performing well. Later that same month on January 31, 2014, the credit union closed the doors to its Santa Clarita branch. 

What the President and members of his posy haven't learned is that no amount of rhetoric will ever hide their well documented failures which are clearly referenced in the credit union's Balance Sheet/Income Statement. The alleged success touted by the President is also contradicted by the more than $26 million drop of the credit union's Net Income and the closure of 6 branches since October 2010. What these losses also attest to is that neither the President or any member of his executive staff possess the knowledge to create strategies that resolve the many problems afflicting Priority One since mid-2008. 

The credit union maintains a satellite office at the NDC, a postal processing plant located in City of Commerce. That office once opened for 3 hours on Fridays. A representative of the credit union's Business Development team would povide employees of the plant, their credit union account and loan balances, dispense information about the credit union's services and products, and accept new membership and loan applications. 

In 2010, the post office offered Priority One a larger office where they could conduct credit union business. Prior to this, the credit union’s office was located inside an office supply room  inside the distribution center. The generous offer meant Priority One would have a more visible and elevated presence at the plant, however, as usual, President Wiggington was unresponsive and failed to order installation of a computer in the new office space. Subsequently, the office could not be utilized adequately and in time, ceased to open all together.  

Here is a record of other blunders committed by the President's and his executive staff which have contributed to the credit union's decline. 

Blunder One

Actually, the first blunder was committed by the Board of Directors who in October 2006 at the urging of Board Chair, Diedra Harris-Brooks, determined Charles R. Wiggington, Sr. was the best and most qualified candidate to become Priority One's next President. 

In November 2006, Directors of the Board announced the appointment of Mr. Wiggington and cited his past banking experience as a key factor for selecting him as the credit union's new President/CEO despite the fact Mr. Wiggington had not been an employee of any bank since 1992. 

Another reason for selecting him to be President was divulged by Directors O. Glen Saffold, Thomas Gathers, and Janice Irving, all of said "Priority One needs a Black President." We'd like anyone of the three to tell us how successful its been for the credit union, members, and employees having a Black President lead the credit union?  Interesting that the deficient Directors ignored Mr. Wiggington's qualifications, a record proving actual accomplishments made while serving as Priority One's Vice President of Operations, personal decorum, dignity, intellect, morality and ethics opting instead to be swayed by skin color.  

Blunder Two

Each year the credit union conducts elections to fill seats on the Board of Directors and Supervisory Committee. In the years before Charles R. Wiggington, Sr. was appointed President, the President and Marketing Director would review a batch of sample envelopes containing ballots prepared for mailing to member's residences. The procedure was part of the credit union's quality control measures to ensure there were no problems with the intended mailings. 

In 2007, President Wiggington decided to circumvent the measure, declaring that reviewing envelopes was not his job. The envelopes were mailed out and soon afterwards it was discovered that on the exterior front side of the envelopes were printed member credit union account and social security numbers. 

When the incident became public knowledge, the President quickly blamed the IT Supervisor. The Board ordered termination of the supervisor, however, the President asked that they only suspend him for 3 days. The President would later tell the supervisor that because of his intercession, the supervisor was not fired. 

To rectify the President's blunder, the credit union offered members one year theft and credit protection.  The cost to the credit union for the protection service was $100,000

Blunder Three

In 2007, the President obtained approval from the Board to purchase a new phone system that he alone selected and which he declared would resolve the credit union's member service issues. 

The President drew up the schematics and ordered that all incoming calls be diverted to the South Pasadena branch even though the branch's phone lines were already overloaded with incoming calls. His plan proved catastrophic and dramatically increased the credit union's member service problems. What's more, his bungled plan added to the already workload of employees at the South Pasadena branch. 

Additionally, the President's so-called state-of-the-art phone system suffered technical setbacks which to date, remain unresolved. The sometimes monthly calls to telephone technicians has added to the credit union's expenditures.

Blunder Four

On January 4, 2007, President Wiggington announced his revamping of the credit union's corporate structure and the implementation of a body of AVP's who he promised would help implement strategies that would increase membership and sales. The President hand-selected AVP's from the credit union's management sector and all who he referred to as his "friends." These were: 
  • Rodger Smock, AVP of Operations and former VP of Human Resources.
  • Jodi Hurst, AVP for Riverside County and former Branch Manager of the Redlands and Riverside branches. 
  • Liz Campos, AVP for the South Pasadena, Los Angeles, and Worldway branches and former Burbank Branch Manager.
  • Sylvia Perez, AVP for Burbank, Van Nuys and Valencia branches and former Van Nuys Branch Manager.
  • Aaron Cavazos, AVP of Lending and former Director of Lending in South Pasadena.
In 2007, just 4 after being promoted to AVP, Mrs. Campos was terminated for kiting. 

In 2008, Mr. Cavazos argued with the President and left the credit union for what was to be a temporary leave of absence. Mr. Cavazos was promoted to AVP despite a long history of complaints from employees, alleging sexual harassment and retaliation. When he requested to return to the credit union, the President terminated him using the excuse that in a review of Mr. Cavazos personnel filed, it had been decided he had amassed too many complaints from employees indicating violations of credit union policies and state and federal laws. 

The AVP sector ceased to exist in March 2013, when the AVP of the Los Angeles and Airport branches was terminated. According to Vice President, Yvonne Boutte, the AVP embezzled money from member accounts. The thefts were discovered during an audit of branch records performed in February 2013. 

The combined costs of salaries paid to the AVP's was in the hundreds of thousands of dollars. Not only did the sector fail to live-up to the hype doled out by the President, not one was successful in implement anything that translated into increased business and membership.   

Blunder Five

In January 2007, the President introduced yet another change born out of his rich and unfettered imagination which he claimed would skyrocket business development. He eliminated the credit union's award winning Marketing Department and replaced it with a Marketing Committee comprised of employees from the Member Services and Loan Departments and none of who possessed any experience or education in marketing. The President asserted confidently that his new plan would substantially increase savings, reducing what he descried as the "outrageous amounts" spent in marketing  by his predecessor. . 

The President demoted the experienced Marketing Director to the post of Marketing Coordinator and appointed AVP, Aaron Cavazos, as the head of the marketing committee despite the fact Mr. Cavazos had absolutely no experience in marketing or advertising. 

By late 2007, the President's inspired plan was beginning to crumble. Internal squabbling amongst committee members and the production of horrendous and ineffective advertising began impacting the credit union's ability to acquire new business. Furthermore, real marketing was replaced by advertising which was reduced to picking graphics and composing poorly written and uninspired copy. What President Wiggington succeeded in doing was disbanding marketing and replacing it with an advertising committee. 

Following Mr. Cavazos termination in 2008 and the departure of almost the committee's participants, the responsibility of "marketing" was appointed to AVP, Rodger Smock, who for a time, was assisted by then AVP of Lending, Patricia Loiacano. Neither was qualified to serve in marketing and through 2008 until late 2009, the two continue to dispense substandard advertising and unwittingly contributing to the credit union's ongoing decline.

Blunder Six

In January 2007, President Wiggington instructed all AVP's to decrease business development focus to postal service facilities and increase efforts to obtaining Select Employer Groups (SEG's). His reason was that he wanted a higher caliber of member comprised of business owners and their employees. The President's efforts to change the credit union's demographics ignored the fact that historically, SEG's showed little interest in the products and services offered by the credit union. As a result, little business was usually obtained from SEG's whereas employees of the postal service had always shown tremendous allegiance to the credit union even during lean economic periods. 

In late 2009, President Wiggington experienced a moment of lucidity, realizing the credit union was not generating income from SEG's. He immediately ordered that business development representatives again increase visits to postal facilities. In November 2010, business development representatives were asked to desist all efforts to induct SEG's. 

Blunder Seven

In mid-2008, President Wiggington easily obtained permission from Board Chair, Diedra Harris-Brooks, to borrow $20 million from the credit union's line of credit. This was another first for President Wiggington as prior to his appointment, no other President had felt inclined to borrow from the credit union's line-of-credit.  The reason for borrowing the money was pure vanity. In 2008, the credit union's asset size had begun to decrease and so the President along with his accomplice, the Board, borrowed the money and was able to create the appearance that Priority One's asset size had increased as a result of new business. The loan cost the credit union approximately $30,000 a month in interest payments alone which further taxed the credit union's waning coffers.  As usual, the President did not possess the intelligence to create effective strategies, so he resorted to a deceptive and manipulative ploy to create the impression of success. 

Blunder Eight

In early 2009, the President began disclosing that he needed a COO who could take many of his projects that he was too busy complete. A few months later, he obtained approval from the Board of Directors to hire a COO. On June 1, 2009, his then "friend", Beatrice Walker, arrived at the South Pasadena branch and though escorted through the office by then AVP, Rodger Smock; he never introduced her by name nor her position title provided. 

In January 2007, the President confided that he created the AVP sector so that he would not have to work to develop new business, leaving the arduous task to his selected Assistant Vice Presidents who he said would have to bring in new business. As it turned out, they failed to carryout their assigned responsibilities and one by one, were terminated over the next 6 years. Similarly, the President hoped the hiring of a COO would further diminish any of his responsibilities.

He hired his then friend, Beatrice Walker, as the credit union’s first COO. Unbeknownst to the President, Ms. Walker found him unqualified to be President and confided to her then allies, Yvonne Boutte and Joseph Garcia that she intended to displace the President and that once she was named CEO, she would promote Mrs. Boutte and Mr. Garcia as officers who would serve directly beneath her.

In the two years which followed, Ms. Walker wasted hundreds of thousands of dollars on failed enterprises including programs that never garnered member interest. She also spent  large amounts building a Call Center whose performance has proven lackluster and even contributed to the credit union’s increasing member service issues. In 2010 and 2011, she remodeled the South Pasadena branch and the lobby of the Burbank branch. She assured the board more people would want to become members if the appearance of the two offices were improved. The Burbank branch closed at the end of May 2012 and the South Pasadena branch is known amongst members for being depressing and its employees appearing unhappy. Evidently, Beatrice Walker was wrong. 

Blunder Nine

In 2011, the President decided to rid the credit union of COO, Beatrice Walker, but not before first seeking to hire a Director of Lending. What Ms. Walker didn't know was that the President had already planned her termination and that a new Director of Lending would assume many of the responsibilities once performed by the COO. 

In 2011, the credit union posted an ad seeking a Director of Lending who would be paid $63,000 annually. After interviewing candidates, the credit union decided on hiring Cindy Garvin as its new Director of Lending. In late June 2011, Ms. Garvin accepted the position and on Wednesday, July 13, 2011, Beatrice Walker was informed she was being terminated. 

Ms. Garvin reported to work at the main branch in South Pasadena, California on Monday, August 1, 2011. At the time she was hired, Executive Vice President, Rodger Smock, issued a memo, informing employees that Ms. Garvin had been come from Clearpath Federal Credit Union where she served in the capacity of AVP of Business Services, Marketing, and Business Development. He described her as both highly qualified and accomplished.  4 months after being hired, President Wiggington promoted her to the post of Chief Lending Officer ("CLO") and appointed her authority over operations for all of Priority One's offices. 

Ms. Garvin's alleged experience failed to resolve the problems created by President Wiggington and the Board. Ms. Garvin also suffered from inability to get along with others. Like President Wiggington, Beatrice Walker, and Vice President, Yvonne Boutte, Ms. Garvin possessed an insatiable predilection for gossip and creating discord. For a period of several weeks in mid-2012, she and Vice President, Yvonne Boutte, would meet not-so-secretly, in the alleys located around the main branch, where they would gossip about employees, the President, and members of the Board. Their private meetings came to a sudden end when we reported their practice on this blog. In 2012, Ms. Garvin along with her subordinate, Joseph Garcia, targeted and terminated many employees who allegedly failed to carryout their assigned duties. 

On December 28, 2012, Ms. Garvin was terminated for unsatisfactory performance. During the 16 months of her employment, Ms. Garvin could not extricate the credit union from the problems authored by President Wiggington. Her alleged expertise, skills, and knowledge in sales and loan development, once loudly proclaimed by EVP, Rodger Smock, were never attested to in anything she endeavored to do. 

Blunder Ten

President Wiggington never liked the idea of a Business Development team. In 2007, he ordered increased scrutiny of all Business Development Representatives insisting they could bring in a lot more new business. The basis for his belief was purely emotional and not based on tangible evidence. At the time, he also confided that he disliked the team because it was the brainchild of his predecessor. His statement possessed no rationale and like so many of his beliefs, was based on pure conjecture born out of his unfettered emotions. 

In 2009, newly hired COO, Beatrice Walker, joined the President's efforts scrutinizing the team's contributions and even exclaimed during a manager meeting that she could bring in more business than the entire team, combined. Of course, Ms. Walker never proved she could bring in more business and President Wiggington never introduced a single proven strategy that could have been provided to the team that might have lent some credence to his imaginary belief of the team's ineffectiveness. 

The team ceased to exist on or about October 2012. Its demise accelerated the unraveling of the credit union's former healthy relationship with employees of the United States Postal Service and Select Employer Groups. In 2013, the President appointed Joseph Garcia as the credit union's sole business development representative though Mr. Garcia has failed on a monthly basis to attain his assigned goal of $150,000 and has been poorly received by employees of the United States Postal Service.

Blunder Eleven

In 2010 as a result of the President's chronic failure to implement strategies that reap new business, increase membership, and generate profit, the credit union's capital began to plummet. State auditors suggested an immediate reduction of the credit union's expenditures and so in September 2010, then COO, Beatrice Walker, and CFO, Saeid Raad, identified four branches whose monthly leases exceeded $5000 each. It was decided to close the Redlands branch in October 2010 and the Valencia branch in November 2010. 

The Valencia branch was actually a successful location, generating far more money than either the Burbank, Redlands or Riverside branches. However, the decision to close the branch was made by then COO, Beatrice Walker. Her decision was purely personal and unrelated to business. At the time, Ms. Walker had experienced a falling out with the Valencia Branch Manager and in act of pure vindictiveness, she ordered closure of the branch. She also planned on subjugating the Branch Manager by demoting her and transferring her to the failing Burbank office. As is typical at Priority One, Ms. Walker’s vindictive act was sanctioned by President Wiggington; Executive Vice President, Rodger Smock; and Board Chair, Diedra Harris-Brooks.

Blunder Twelve

In 2010, Providence St. Joseph Medical Center in Burbank, California, offered the credit union space within the hospital, where it could install a branch that could replace the poorly performing Burbank branch.  Many employees of Providence St. Joseph Medical Center were members of the credit union. This would have introduced added convenience to employees of the hospital while providing an opportunity for Priority One to maintain a newer, more convenient location. 

President Wiggington delegated negotiation of the space to then COO, Beatrice Walker, who in turn, delegated planning to then AVP, Sylvia Perez, and then Director of Project Management, Yvonne Boutte.  The decision to place responsibility for planning of the new branch made no sense because Mrs. Perez was a horrendous officer with a long history of complaints filed against her by employees of the credit union. Furthermore, the project fell far outside of her experience. Similarly, Mrs. Boutte was equally unqualified to negotiate acquisition of the space, much less plan out installation of a branch.  

In the weeks which followed, officers of the hospital made several attempts to contact the credit union about the proposal but neither the President, the COO, the AVP, or the Director of Project Management felt inclined to return their calls. 

In 2011, the hospital informed Mrs. Perez that the credit union would no longer be invited to participate in monthly new hire presentations. The credit union had for years enjoyed the privilege of participating in the orientations during which they spoke to new employees about the benefits of being a member to the credit union. 

President Wiggington was so incensed by the hospital's decision not to include Priority One in new hire presentations that he ordered cessation of all business development efforts to the credit union.  Obviously, President Wiggington did not understand that his actions contributed to deterioration of the credit union's relationship with the medical center. It apparently also didn't occur to him that the credit union needs business from the medical center. 

Blunder Thirteen

In January 2007, the President ordered AVP's and Business Development representatives to reduce focus on obtaining new business from employees of the United States Postal Service (USPS). He ordered that aggressive efforts be made to induct Select Employer Groups ("SEG's") explaining he wanted a different and "better' membership comprised of business owners and their employees. 

The problem with the President's "vision/delusion" is that historically, little business was ever obtained from SEG's. There was also the fact that employees of the United States Postal Service had demonstrated unwavering allegiance to the credit union since its founding in 1926 and had even carried the credit union through lean economic periods. Of course, the facts were inconsequential to a man who rarely relies of facts and ignores the importance of studies that might provide an assessment of the viability of his spontaneous, poorly conceived ideas. 

In 2014, the credit union continues to reap little business from SEG's while its once strong and long relationship with employees of the USPS is tenuous at best. 

Blunder Fourteen

In 2011, Providence St. Joseph Hospital contacted then AVP, Sylvia Perez, and informed her that the credit union would no longer be invited at attend monthly new employee orientations conducted by the hospital. For years, Priority One had enjoyed the privilege of being included in the hospitals new hire orientations during which they were allowed to conduct a brief presentation describing the benefits of being a member to Priority One. 

Incensed by the medical center's withdrawal of its long standing invitation, the incensed President ordered an immediate cessation of all business development activities at the hospital stating, "We don’t need them!” The President's response was both emotional and typical and once again reveals his inability to understand that it is not Providence St. Joseph that needs Priority One but rather the credit union that needed and needs a relationship with the hospital though in 2014, the credit union has lost the clout it once enjoyed with all Providence hospitals. 

Blunder Fifteen

In March 2007, an anonymous letter sent to a Director of the Board disclosed that then newly appointed AVP, Liz Campos, had overdrawn her account more than 24 times during the months of September 2006 and October 2006. The activity occurred while Ms. Campos served as Branch Manager of the Burbank office. Also, when the abuses occurred Charles R. Wiggington, Sr. served as Vice President of Operations and would have known of the abuses. Despite being fully aware of the abuses and having known that over the years, Mrs. Campos had overdrawn her account, he found it prudent to promote her to the post of Assistant Vice President ("AVP"). 

The Director submitted the letter to the credit union's then attorney, William Adler, who ordered an investigation. A subsequent review and audit of Mrs. Campos account disclosed she had been kiting using checking accounts from 3 different institutions. The findings were sufficient to order her termination, however, President Wiggington, and Board Chair, Diedra Harris-Brooks, became incensed with the Director who had submitted the letter to the attorney. During a monthly board meeting, Mrs. Harris-Brooks warned the Director that he was never to confer with the credit union attorney before first bringing a matter to her attention. What is interesting is that despot, Mrs. Harris-Brooks, was unqualified to respond to an alleged federal offense. And though the matter was appropriately referred to an attorney, Mrs. Harris-Brooks and the incensed President, could not but vex their anger against the Director who conducted himself ethically and in compliance to state and federal law. 

During the investigation, the President proclaimed his innocence, asserting he had no idea about Mrs. Campos' abuses yet that would have been impossible in view of the fact he was the VP of Operations. If he truly had been unaware, then it is just one more reason why he should never have been appointed President/CEO as the credit union needed a leader who was vigilant and informed to lead it. 

Blunder Sixteen

In 2008, a former employee filed a complaint with then credit union, William Adler, alleging she had been sexually harassed by President Wiggington, over a period of years.

The attorney ordered an investigation and EXTTI, Inc. was hired to carryout all investigative proceedings. During the investigation, President Wiggington was suspended with pay, a decision approved by Board Chair, Diedra Harris-Brooks. 

The investigation's findings were presented to the Board, though Mrs. Harris-Brooks excluded inviting some Directors to attend the meeting. Unfortunately for the chronically corrupt Board Chair, then Director, Janice Irving, learned of the meeting intended to provide the investigator's findings. Mrs. Irving and Director, Joseph Marchica, attended the meeting to the chagrin of Mrs. Harris-Brooks. The investigator recommended termination of the President. Mrs. Irving voted for his ouster but Mrs. Harris-Brooks, Director's, O. Glen Saffold and Thomas Gathers, and Supervisory Committee Chair, Cornelia Simmons, ignored the documented record of findings and voted for President Wiggington's reinstatement. It was a travesty and one which demonstrated the amoral nature of some of the Board's Directors and of the Supervisory Committee Chair. It also proved that they were each willing to squash tangible evidence proving incidence of a felony. .

Blunder Seventeen

In 2009, at the recommendation of then COO, Beatrice Walker, the credit union hired the services of Lillestrand and Associates, a company who works with many credit unions in improving productivity and morale. 

The founder of the firm, Loren Lillestrand, arrived at the credit union via his "friend", Beatrice Walker. In meetings conducted with credit union staff, he disclosed that he intended to gauge staff interests though tests that would determine their likes, dislikes, strengths, weaknesses, and interests which would be used to create a better, more knowledgeable and more effective work force. What he did not disclose to employees is that he was hired to also help flush out "enemies" of the President who were attempting to topple Mr. Wiggington's imaginary empire and subvert his alleged efforts to develop new business. 

Mr. Lillestrand who is actually well intentioned, agreed to the proposal but failed to concretely prove which employees were truly undermining the President. Furthermore, his findings submitted to COO, Beatrice Walker, which should have been used for staff development, were never implemented. In the end, the credit union spent more than $30,000 to obtain information that was never utilized. 

In 2012, the President hired other consultants who determined that business could improve and the credit union's reputation could be salvaged, if the credit union website were revamped and dozens of the President's and EVP's bios posted throughout the Internet. It was a dull idea ignoring the history of abuses and irresponsible acts committed by the President and in the end was tantamount to putting lipstick on a gorilla.

Blunder Eighteen

The cherry atop the President's history of blunders are his realignment of the credit union's Human Resources Department. 

For years, the department was under directorship of Rodger Smock. In August 2011, then COO, Beatrice Walker, disclosed that Mr. Smock was ineffective, lazy, and overpaid. She removed his authority over Human Resources and transferred it to herself. However, a verbal complaint filed by the Valencia Branch Manager, alleged Ms. Walker had harassed, persecuted and retaliated against the Branch Manager, including alienating the Manager from her staff. Then Human Resources "clerk", Esmeralda Sandoval, referred the complaint to Rodger Smock and President Wiggington. A few days later, the two drove to Valencia to inform the Branch Manager, that Ms. Walker had ordered closure of the branch as part of the credit union's efforts to streamline operations and reduce expenditures. At the time, President Wiggington asked the Branch Manager and Business Development Representative assigned to Santa Clarita, to provide him with letters documenting the acts and statements verbalized by Ms. Walker. 

The President returned to his office in South Pasadena and contacted Board Chair, Diedra Harris-Brooks. Three days later, a message posted on the credit union's Intranet, informed employees that Ms. Walker would no longer oversee Human Resources and that the department's new Director would be then Training and Education Manager, Robert West. 

However, secretly and unbeknownst to employees, the department continued to be managed by Mr. Smock simply because Mr. West had no prior in anything related to Human Resources. 

In July 2011, days after termination of Beatrice Walker, Mr. Smock posted a notice on the Internet advising employees that Human Resources was being renamed Employee Services and its new Director would be Robert West who would be assisted by newly appointed Employee Service Manager, Esmeralda Sandoval. 

The department has proven to be a horrendous intermediary between the credit union and employees. The appointment of Mr. West as Director is a ruse by which to divert attention from the history of failures committed by Rodger Smock. The department is nothing more than a vehicle or tool, which serves to satisfy the President and Board's wishes. The department's decision to exempt many officers from the disciplinary actions described in policy led to the filing of 4 lawsuits by former employees during the years of 2010 through 2013. The settlement of 3 of those lawsuits not only lend credence to allegations that Priority One's officers violate state and federal laws and choose to circumvent policy, it also validates assertions of the incompetence of the department's officers. 

And though the credit union has closed 6 of 9 branches since October 2010, the department continues to employ three officers whose combined salaries exceed $200,000 per year. The entire staff- Rodger Smock, Robert West, and Esmeralda Sandoval, should have been terminated years ago and replaced with new, better education, more qualified and certainly, far more ethical personnel who do not easily compromise ethics for what is politically advantageous. 



The borrowing of $20 million by President Wiggington from the credit union's line-of-credit in 2008 was a clear and indelible signal that some was amok at Priority One Credit Union. And despite the loan of $20 million, on December 31, 2008, the credit union reported losses for the year in the amount of -$690,652. On December 31., 2007, the credit union ended that year $683,589 in the Black.  So from 12/31/07 through 12/31/08, the credit union incurred loses of -$1,374.241


In retrospect, the loan obtained from the credit union's line-of-credit was intended to maintain a record that Net Income was high,  knowing that most members would not understand the actuaries referenced in the credit union's Balance Sheet/Income Statement. And though the credit union sustained tremendous losses during that period, the Net Income appeared to remain high, though clearly and based on the references found in their Income Statement, immense losses were sustained as a result of the President's inability to implement anything that reaped real profit. . 

At the end of 2009, the credit union reported losses in the amount of a whopping -$5,458,432. Despite the staggering losses, the President continued to insist business was great. At the time, his tidings of great business were joined by then COO, Beatrice Wiggington who insisted new business had been gotten at the end of the year though undeniably, there was no evidence of this in the credit union's financials. Furthermore, the Board of Directors under Board Chair, Diedra Harris-Brooks, was apparently unconcerned and took no remedial measures to determine why business had declined and why President Wiggington's decisions were not only failing to achieve their intended purpose but causing the credit union to hemorrhage losses.    


On December 31, 2010, the credit union ended the year in the negative, reporting losses in the amount of --$563,830

Over the years of 2008 though 2010, the Board remained unresponsive and refused to enact inquiries needed to understand why the President's decisions were causing losses of income. And though the Board has a responsibility to ensure that the best interests of members are realized, Priority One's board has over the years, been unusually unconcerned. In fact, their failure to act is disturbing. Could it be that President Wiggington was correct when he said the Board did not understand the credit union's financials? Based on the Board's ineffectiveness it is reasonable to conclude that none of the Directors possess a basic understanding of finance or accounting practices nor do they comprehend the actuaries contained in the balance sheet and income statement. 

The closure of the Airport branch on December 13, 2013 and closure of the Santa Clarita branch on January 31, 2014 in addition to the closure of 4 other branches in the period between 2010 and 2012, serve as evidence that Charles R. Wiggington, Sr. and the Board, have been plutonium to the once successful credit union. Horrendous business decisions, undisciplined and embarrassing behaviors, an inability to comprehend the internal workings of the credit union have left Priority One a mere shadow of its former self. 

The President's reliance upon consultants to try and dredge Priority One out of its mire has proven to be an expensive and futile enterprise. The expensive efforts implemented by consultants have failed to increase membership, promote business development and failed to resolve the myriad of issues created by Priority One's highest officer. 

In mid-2012, the President again hired consultants who after a study of the credit union's service levels and product portfolio determined that what Priority One most needed was a revamped web page and a spanking new smartphone app. These alleged enhancements which we will describe in next month's post, were alluded to in the President and Board Chair's address contained in the 2012 Annual Report and touted as indicators that Priority One's business was improving.  The reference to the revamped web page and app were an attempt by two simpletons to try and convince members and employees that a new web page and smartphone app are synonymous with success. The proof that Priority One is failing versus prospering, is proven by the credit union's Balance Sheet/Income Statements and its quarterly Financial Performance Reports versus the President and Board Chair's chronic lip service

The truth is, Priority One remains in a state of decay. What's more, President Wiggington and his overpaid posy have never developed anything that succeeds in generating a level of profit needed to positively impact losses. Furthermore and as cited by Bankrate in early 2013, Priority One's overhead is precariously high. The revamped web page and app did not contribute to the credit union's decline but neither did they serve to resolve the issues underlying the credit union's far flung problems. 

As we have often published, the President, the executive sector and the Board of Directors remain responsible for delving out solutions for the very problems they alone created. Their efforts thus far have been purely superficial and refuse to consider that they are the single cause behind Priority One's deterioration. 

The reason for the credit union's failures is that  the solutions sought by the President and Board of Directors, are purely superficial and refuse to address the causes of the credit union's far flung problems which are the President, the executive sector, the Board of Directors, and the seemingly invisible Supervisory Committee. 

Yesterday, February 19th, a member posted the following comment expressing frustration and dissatisfaction over the level of unsatisfactory service being dispensed by Priority One nowadays.


I called the credit union today and waited 35 minutes until someone finally answered the phone. I told Tina, the person who answered the phone, about how long I waited on the line and she replied, "That's alright, we're working on it!"

What a moron. She doesn't understand what member service is. I wanted to bitch slap her over the phone. I'm closing my account on Friday along with the accounts to my wife, 2 sons and daughter. 

Enough is enough. This isn't the first time I have to wait and wait and this isn't the first time I have to speak to a moron. Management is jacked up so its no wonder they hire jacked up people.

February 19, 2014 at 10:20 PM

Its evident that a new, revamped web page and smartphone app are not going to resolve the problems impacting the credit union's apparent inability to jump start business or the many issues afflicting member service. So what lies ahead for the rapidly shrinking credit union? Since 2009, we've predicted that Priority One will continue to sustain losses simply because Charles R. Wiggington, Sr. is unqualified to serve as President and CEO. It is important that the same factors which caused Priority One's decline over the past 7 years, remain intact. 

It is also important to note that the credit union's capital remains high which is a key reason why Priority One remains in business. However, the closure of 6 branches since October 2010 are nothing more than a pardon, extending what will be the credit union's ultimate demise unless they experience a sudden and miraculous reversal of their current misfortune or if they are taken-over by another credit union. Until then, their survival will continue to depend on expense reductions, possibly future branch closures, and leveling increased fees and charges to its membership. 

In 2014, account closures continue to exceed account openings and though the credit union aggressively pushes loan development, the fact is, their monthly Income Statements show an unhealthy and increasing reliance on charges and fees. What's more, the credit union's relationship with employees of the United States Postal Service and Providence hospitals may have reached an irreparable state which has coupled the credit union's inability to promote its products and services. Additionally, Priority One no longer sends representatives to monthly Chapter Meetings and chamber and community sponsored events. 

At Priority One, convenience is a thing of the past forcing the credit union to place increased emphasis on Shared Branching and Home Banking services. Priority One no longer have a presence in all of Riverside County or the entire Santa Clarita Valley. The Santa Clarita branch was constructed in late 2011, by former Post Master, Ralph Tapia, as a good will gesture to the credit union for its years of service to the postal community. Clearly, Charles R. Wiggington, Sr. was unappreciative and did nothing to promote the credit union's northern-most location. However, the good news is, the space formerly occupied by Priority One is scheduled to be taken by another credit union

The worst part of the President's bungling and the Board's paralysis is the ordeal they have subjected present and former employees to in their quest to maintain control of a crumbling credit union managed by a contingent of unimpressive and incompetent officers who appear to be playing opossum as the credit union sinks deeper into the mire created by President Wiggington. 

To be continued......

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