Where's the Proof?
In our last post, we wrote about Priority One Credit Union's Board of Directors and their spending habits while allegedly attending events, conferences, and seminars intended to provide them with the knowledge needed to ensure the credit union's general direction and it's controls.
Recent disclosures suggest the Directors are conducting themselves less like officers and more like teenagers who are traveling out of town for the first time without being accompanied by their parents. Disclosures include allegations that the Directors are not attending classes and meetings, that money provided to them for their expense is being spent on alcohol and souvenirs. We think that the following concerns should be addressed:
- How much money was spent by the credit union to send each Director to Hawaii? How much was spent on airfare and how much on hotel accommodations? And how much was each Director given to pay for their daily expenses?
- Of the money provided for their daily expenses, how much was spent on food, how much was spent on alcohol and how much was spent on souvenirs? And how much, if any, is unaccountable for?
- And each Director should provide proof that they actually attended classes, meetings and conferences. After all, isn't education the reason they traveled to Hawaii?
We'd like to also know how much was spent to send each Director to Las Vegas? We recently learned that Board Chair, Diedra Harris-Brooks, receipts show that she spent a lot of her expense allowance in the casino bar. She also exceeded the amount of her allotted daily allowance. The President ordered that the Accounting Department disburse Mrs. Harris-Brooks expenses so that these do not show that she exceeded her per diem. The President is using his usual brand of not-so-clever reporting practices to cover-up Mrs. Harris-Brooks apparent abuse.
Auditing the Director's receipts would provide insight into the actual activities of the Directors during educational junkets. It would also confirm if the Directors are misusing credit union monies set aside for purely educational purposes.
The behaviors of the Directors is showing, more and more, that they are unconcerned by the credit union's increasing struggle to acquisition new business and increase membership. Clearly, the Directors have foregone education and are unconcerned by the fact that money paid to send them to junkets is being use to play and do the "tourist thing."
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3 comments:
The DFI and NCUA would be very interested if you could provide evidence that Board members were going to seminars in Vegas and Hawaii (junkets) on the credit union's dime and you could prove they did not attend any of the sessions or perhaps one session at a 4 day conference. If they only went sight-seeing and ate and drank like pigs at a trough that would be outright fraud. But you'd have to have documentation and witnesses. I would think it would be tough to prove they did not attend any of the teaching parts of the conference.
How much in food and booze were the officials spending daily? Was it $200-$300 per day, per person? I bet they would not spend that kind of money if it was out of their own pocket. Were spouses allowed to attend on the CU's dime? Those flights and extra food would be expensive for a CU posting red-ink. Are receipts required or do they get a flat-daily fee? Does Priority One have a policy covering conference expenses? A standard food allowance in Vegas might be $75 per day. Were Vegas shows picked up by the CU, too? It's standard business practice to provide receipts.
If the conference was 4 days did the CU pick up the tab for a 7-day stay in Hawaii - fraud again.
Can you get how much was paid for each board member who attended the Vegas Conference?
For a 4-day Vegas conference how much did the Board Chair Diedra Harris-Brooks charge to the CU beyond the cost of the room? Were the charges out of the norm? My guess is she spent a bundle well above what a Postal worker would spend on a normal vacation.
All that has to be audited are the credit union's records to obtain the specific amount spent on Ambassadors during both trips.
The expenses should also be reflected in the quarterly report ending March 2009.
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