Slight of Hand, Part 1

NOW YOU SEE IT,

NOW YOU DON'T.

YOU MOSTLY DON'T

In business, its not magic or trickery that determines the competency of a President or in the case of Priority One Credit Union, it's Board of Directors or Supervisory Committee, but what is actually achieved. President Charles R. Wiggington,.Sr. and Board Chair, Diedra Harris-Brooks, apparently believe that verbalizing the achievement of non-existent success is a wonderful substitution for actual achievements. Their empty assurances have become of deterring attention from losses, failed business decisions, illegal acts and embarrassing scandals. 

Last month an in defiance to state law, President Wiggington declared he will not be posting December 2009's Monthly Income Statement at any of the credit union's branches. Instead, he has entered into another of his absurd campaigns assuring anyone who will listen, that business is good and in fact, the credit union earned profit during the month of January. That is wonderful news. However, his statement seems odd and inconsistent with the fact that 2009 ended with more than $450,000 in losses. It's also peculiar because at Priority One Credit Union January is always one of the slowest months of the year. So how did the credit union produce profit in one of the slowest months of the year when throughout 2009, every month sustained immense losses? 

The President's statement is also being repeating by COO, Beatrice Walker, which doesn't serve as evidence. We'd prefer viewing the Monthly Income Statement but of course, the President refuses to post it. The biggest impediment to the credit union's success is the President who since 2007, has continually sabotaged efforts to instill growth. His excuses, exclamation to success, and assurances that all is proceeding as planned amount to more blather from a President that is obsessed with talking and hiding financial reports. 

This blog was launched in January 2009, with the hope the Board of Directors would step forward and force corrective measures to be implemented that would stop the President's abysmal decisions. The Board refused, choosing instead to enable the horrendous decisions of President Wiggington. 

Since 2007, we've continually listened to the President's promises that business was going to improve but the reversal to the destructive dynamic he created, has yet to be seen. He is clearly a failure as a strategist and his shallow rhetoric has growth thin. In spite of his far flung failures and the fact that the Board has relegated some of his authority to Beatrice Walker, the Board has recently renewed his agreement again. It may be easier to explain the extinction of dinosaurs than understand the Board's illogical reasoning.

STOP BREAKING THE LAW!

In January, the President was urged by his executive staff to post December's monthly financial. It seems that unlike the President, his executives were concerned that his refusal to post the report would provoke the filing of another complaint to the DFi, just as occurred last June when two members filed complaints. 

In spite of the President's well documented failures and abuses, we received the following comments from readers of this blog, leveling criticisms against us. We happen to know who their authors are because President Wiggington could not refrain from boasting about how he and a Director "put them in their place." 

Here are the comments. We've added the names of the authors at the end of each statement:  

Comment #1

"This blog perpetuates mindless redundant rhetoric. Nothing new just more Blah Blah Blah. Blogger if you are so unhappy at P1, look for another J.O.B., otherwise shut the f**k UP."

Thomas Gathers, Board Director

Comment #2

“I’m laughing because your sabotage hasn't worked, and I am still employed. You are laughing because you are unaware that dooms day is very close to you. Soon you will be included in California’s 12.4 unemployment rate. So now, who is the idiot?

President Charles R. Wiggington, Sr. 

"So now, who is the idiot?"  Is this a rhetorical question, because the answer is too much too obvious?

Financial statements that document immense losses, an investigation that proved the President committed sexual harassment, the loss of millions of dollars of Net Income, and the need to lie about the credit union's actual performance all tell us who the idiot is. And for those who may not know, one President Wiggington's periodic exclamations is, "I am still employed." And so melodramatic, reminding us that President Wiggington is a man prone to emotional tirades. 

The President and his equally undisciplined lackey prove that when exposed you can expect threats, profanity and inane declarations. The two were too glib to notice that this could have been a wonderful opportunity to provide evidence disproving what we've reported but of course, that would require that there was tangible proof of success, something that President Wiggington knows, doesn't exist. 

Well, thank you Mr. Gathers and President Wiggington for chiming in with mindless rhetoric but if this blog were truly nothing more than "blah, blah, blah" then why would you feel impelled react to what we report? 

 Who Knew?

Priority One continued its immersion in the red at the end of 2009. No wonder the President said he would not be posting December's financials. 

To review, here are the losses reported by the credit union during the months of October, November and December 2009:

October

-$133,503.84 

November

-$116,499.56 

December

-$784,870.51

Well that certainly isn't "Blah, Blah, Blah", is it? Priority One still has a remaining unpaid $10 million balance due on the $20 million loan borrowed by the President in mid-2008. Due to the unpaid balance, their actual Net Income size is NOT $165,835,128.90 but $155,835,128.90. On January 1, 2007, the date Charles R. Wiggington, Sr. began his appointment as President, the credit union's Net Income size was 

$172,250,649. So how did Priority One's Net Income size decrease by approximately $17 million in a 3-year period? No wonder the President and Board think that our reporting is "blah, blah, blah." 

Since January 1, 2007, the credit union's annual legal expenses have increased by over 270%. A review of the credit union's financials show that annual expenditures on legal increased from $20,000 per year to approximately $38, 000 per year. In 2009, legal expenses soared to $118,000. During last May's annual meeting, Charles R. Wiggington, Sr. stated that he was reducing spending, "streamlining" and "working smarter." Is the sudden jump in spending an example of his new business philosophy? 

One reason for the sudden rise in legal expenses is because the ignorant Board frequently consults with the credit union's legal counsel to obtain information about the financials they're supposed to understand. 

The credit union set aside a budget of $67,200 to spend on consultants for 2009, but December's Monthly Income Statement reveals that $82, 000 were spent. 

The budget for the annual meeting was exceeded by $32,000. The credit union recently disclosed that a part of the excess was due to legal expenses but why would legal expenses be reported under annual meeting costs? 

The credit union’s total assets decreased by $3,206,912.27 and loan funding decreased by $1,225,013. Shares decreased by a total of $2,255,468. Net capital decreased to 6.78%. 

  

BLAH, BLAH, BLAH

This may come as a surprise, but not every member of the Board is pleased with the President’s performance. Some of the Directors have quietly expressed their dissatisfaction but none are willing to challenge Board Chair, Diedra Harris-Brooks, for continuing to retain his employment. 

In the recent past, Directors, like David L. Davidson, and Rob Shipp found themselves ostracized and labeled dissenters because they vocalized their disagreements with Mrs. Harris-Brooks mode of doing things. 

An email sent to us a few weeks ago ,provided quotes of an address made by President Wiggington to the Board. Here are the excerpts:

“As stated in my last message, together we will weather this current storm. Together, we will continue to support one another. Together we will arrive at a better day.

You can count on my committed and focused hard work as our servant leader to make 2010 a more prosperous year for all of us. Thank you from the bottom of my heart for the privilege of serving you and the rest of the credit union team.”

More meaningless rhetoric from an immensely incompetent President. One of the problems with the President is that he's always trying to sell a bill of goods that has no substance. He always resorts to the same only insincere song and dance hoping people will buy into his vacuous assurances. 

Trying to work with the President requires contending with his psychology. He is currently imploring the Board for help because of the information containing in the Monthly Income Statements and because Beatrice Walker has succeeded to absorbing some of his authority. In 2007, he exclaimed, "No one tells me what to do" and based on the credit union current financial stating, no one could tell him what to do.  The decline of the credit union was caused by him and sanctioned by the Board of Directors.  

MANNY

Before his final date of employment on December 31, 2009, CFO, Manny Gaitmaitan, warned President Wiggington that the decision to implement Priority Pay, an alternative to payday loans, was not well-planned and could cause the credit union's debts to further amass. His advice was rejected and Mr. Gaitmaitan was labeled uncooperative and even accused by COO, Beatrice Walker, of trying to sabotage her efforts to create new streams of income. 

Recently, the credit union mailed out invitations to Priority Pay to only those employees whose Priority One accounts showed they have obtained loans from payday lenders. The letter was erroneously mailed without inclusion of a Disclosure statement. Additionally, the letter was unsigned. There were also no terms provided. 

A member recently wrote to us, stating that she called Priority One and asked for the Disclosure and Schedule of Fees but was informed that the credit union was out of both. On a side note, the cost of implementing Priority Pay was $50,000. Is this another example of how President Wiggington is reducing expense? 

We've also learned that Board Chair, Diedra Harris-Brooks, recently called Mr. Gaitmaitan and asked if he could provide questions that she may ask candidates who are interviewed for the position of CFO. Why didn't she ask President Wiggington for advice? And wasn't it the President and COO, Beatrice Walker who described Mr. Gaitmaitan as "difficult", "uncooperative" and "not a team player." 

Priority One is a credit union with too many overpaid executives, incompetent and dishonest executives. As hard as they try, the President and Board Chair's plots have a tendency of surfacing and becoming public knowledge. The breach in confidentiality can be traced by to President Wiggington and in recent weeks, to Beatrice Walker, who has revealed, more and more, that she wishes to become Priority One's next President and CEO.  Violating confidentiality, she also recently stated, "Where else am I going to get another job that pays as much as this one?" To be frank, we don't think she, President Wiggington, or AVP, Rodger Smock, would ever be hired by any business that values competency and ethics. And its unlikely that Diedra Harris-Brooks and her posy of clowns could ever serve as volunteer or even paid Directors on the Board of any other business. 

Fading Out

A SHIFT IN POWER 

Priority One has launched its new call center though without fanfare. This actually would have been the perfect opportunity for the President to declare future success, but as is typical with Charles R. Wiggington, Sr., missing the right opportunity seems to be just business as usual at the financially troubled credit union. 

President Wiggington's leadership limitations aside, in recent weeks we've noticed a pronounced change of his authority. We noticed subtle changes at the start of August, which became more and more markedly noticeable with each passing month. 

We've also observed that COO, Beatrice Walker's authority has conspicuously increased and that she's taken more and more control over sectors of the business once selfishly clung to by the President. 

The Board of Directors under leadership of Chair, Diedra Harris-Brooks, recently ordered the President not to interfere with Ms. Walker's plans. He was informed that Ms. Walker's plans as described to the Board, will  reverse the financial problems caused by the President's poor business decisions and will introduce effective streams of income which in turn, will produce desperately needed profit. Obviously, Ms. Walker has done more than just win the trust and support of the Board, she's convinced them that the President is incapable of resolving the problems he alone created; and that she considers him a potential deterrent to her plans for success. .She might actually be correct. 

However, Priority One's Board has proven to be both immensely inept and equally corrupt. Subsequently, can we trust any decision they make that is supposedly intended to improve business? The Board, unfortunately, is looking for a quick fix irrelevant of the source. And though the Directors oversee the direction of the credit union, under Diedra Harris-Brooks the direction is leading to decline. Can anyone point to another Board in the entire credit union industry who has behaved as irresponsibly or reprehensibly as has Priority One's Board? 

JUGGLING ACT

The following comment was published in response to our last post and concerns the credit union's Loan Loss Provision:

"Between June 30 and September 30 Wiggy had to move another $500,000 into the Provision for Loan Lose account. They would only do this if they project another 1/2 million dollar lose [loss] or if they charged off that much during the quarter and need to replenish the account. Either way, it's the wrong direction. Now I'm starting to wonder if they will even make it to 2/22."

Since mid-2008, when the effects of reduced business became more evident, the President with the help of the Board Chair has expended tremendous time and energy moving money around including transferring funds from general ledgers and reporting these as profit when no actual profit occurred. 

Another reader posted the following comment regarding warnings issued by CFO, Manny Gaitmaitan:

"The CFO has been warning Wiggington for many months that delinquencies are increasing too rapidly and the credit union is spending too much money. Wiggington got mad one of the first times the CFO warned him and later told the Bea and Rodger that the CFO is insubordinate and refuses to follow orders. Wiggington doesn't know the difference between insubordination and wisdom because he wants what he wants no matter who it hurts. Friday he had a meeting with the CFO and warning the CFO. The CFO left work early and didn't come in today. Priority is bleeding money and they are spending too much. They are supposedly a financial fitness center but they can't take care of their own business, how can anyone expect them to take care of member's money?"

Unfortunately, for the CFO, President Wiggington is a man devoid of understanding the nuances that work together to create new business, increase membership, produce profit, reduce losses, etc. He's also not a man who wishes to adhere to ethics and based on his behaviors, laws are something he feels do not apply to him. He shirks challenges, finding them insurmountable but receives immense gratification from constantly violating policies and laws. Subsequently, the CFO's refusal to violate mandated accounting policies are tantamount to insubordination and as a personal attack upon his person. 

Another reader posted the following comment concerning the President's rampant spending:

"Employees, members, and readers of this blog can't even imagine how much money the credit union is spending. Its like they know they're sinking but just don't care. I don't get it. Maybe they can provide a comment explaining why they spend the way they do and where they are getting all the money."

The President will never provide an explanation for his confused business practices. Over the past two years, he's implemented a salary freeze that only impacts non-exempt personnel, the sector of employees who earn the least amount of money. And he recently terminated four (4) employees because the credit union desperately needed to reduce spending. 

The President next hires a COO who being paid more than $100,000 per year plus benefits. He also purchased a $600,000 phone system and has now opened a new call center. Does anyone else get the impression that Charles R. Wiggington, Sr. is a man who has absolutely no comprehension of the difference between being cost-effective and wild, undisciplined spending? 

EVERY PENNY COUNTS

Who would ever have thought that eliminating the purchase of Styrofoam cups would not succeeded in resolving Priority One's financial problems? At the end of October 2009, the amount of losses decreased though the credit union remains embedded in the Red.

Have reduced losses serve as an indicator that the President has finally derived solutions that are succeeding to drive down losses? We doubt it. The credit union's business development efforts continue to falter and there is nothing we can point to- at least not for the moment, that hints at why losses have slowed down. Furthermore, we don't trust President Wiggington. 

BULLYING

The rift that has developed between the President and CFO, Manny Gaitmaitan, has spread with COO, Beatrice Walker, beginning to publicly criticize the CFO and like the President, labeling him uncooperative. Also siding with the President and Ms. Walker, is AVP, Rodger Smock, who has stopped speaking to the CFO. Yes, this is probably a dynamic more common in an elementary school yard but one President Wiggington has purposely created in his effort to ostracize Mr. Gaitmaitan. According to the President and COO, Mr. Gaitmaitan constitutes insubordination and is impeding the President's efforts to reverse the credit union's financial problems. 

What the President views as efforts to resolve the credit union's financial problems is using deceptive financial reporting practices to create an impression of profits where none exist and reduce reported losses. Mr. Gaitmaitan refuses to follow the President's orders which has now resulted in him being branded and exiled from President Wiggington's inner sanctum. Through a combination of shaming and slander, the President may hope to either force the CFO into submission or driving him out of the credit union. We believe the President is trying to force the CFO's resignation. 

Over the past 2 weeks, the credit union has receiving a large number of faxes and telephone calls concerning the "available" CFO position. According to the President who again, can't seem to guard confidentiality, the credit union is seeking a new CFO because Mr. Gaitmaitan has decided to resign. 

CONSULTANTS

We recently received two emails regarding a recent visit to the South Pasadena branch by consultant, Loren Lillestrand of Lillestrand and Associates. 

On Thursday, November 19th, Mr. Lillestrand met with employees and spoke to them about attitude and perceptions towards their employer. Clearly, Mr. Lillestrand is trying to alter the current negative view employees have the executive sector and though we agree with some of what Mr. Lillestrand said, the fact is the consultant is not an employee of the credit union and in the end, his opinion is based on what he has been told by the President and his "friend", Beatrice Walker.

Ultimately, it is the management of any company that set the tone for the working environment. The President has chosen to slander employees and with the help of Human Resources, has at times created fraudulent evidence and charges used to seal the termination of targeted staff members. Mr. Lillestrand's advice places the burden of change upon employees while circumventing the executive sector's abuses which created the destructive dynamic which has developed at the credit union since Charles R. Wiggington, Sr. began his appointment to President. 

Mr. Lillestrand's efforts are clearly guided by an agenda created by the President and the COO. If Mr. Lilllestrand hopes to introduce change, he must address the cause of the problem which is President Charles R. Wiggington, Sr. Since it is the credit union that is paying him, don't expect Mr. Lillestrand to direct his efforts towards any members of the abherrent executive sector. What's more, there is no internal problem that can be resolved in a few visits to any company. 

During the credit union's last all-staff quarterly meeting in South Pasadena, employees were asked to provide suggestions on how to reduce spending. One suggestion asked that the executive sector voluntarily agree to reduce their salaries temporarily. AVP, Rodger Smock, and COO, Beatrice Walker, turned from where they sat at the front of the room and simultaneously stared at the employee making the suggestion. If the executive sector doesn't wish to hear suggestions, then don't ask for them!  

The decision by some executives to voluntarily and temporarily reduce their salaries is a phenomena that is occurring in many companies throughout the United States. It is a selfless effort to help their employers during difficult economic periods where a company may be experiencing financial losses. The decision not only helps a company reduce spending but may help avoid laying off staff. Not so at Priority One where the greedy executive sector is not about to adopt any change that reduces their salaries or benefits.  

The employee has now been targeted by AVP, Rodger Smock, and COO, Beatrice Walker, both of who have ordered her supervisor to scrutinize her work which they suddenly find subpar. Unfortunately, the prudent suggestion has offended the sensibilities of the executive sector who have placed her name on their "enemies list."

FINANCIALS FOR THE MONTH ENDING 10/31/09

The credit union's financials improved during the month of October 2009, though Priority One remains deeply embedded in the negative. 

Anticipate 2010 to end in the negative, again. Many of the President's so-called expense reduction measures were only implemented recently and so they will have little impact upon the credit union's economic state through the end of the year. 

The financial information shown below is an excerpt obtained from Priority One's Monthly Income Statement for the month ending October 31, 2009. We've annotated in red font those actuarials which we deem important and those we find questionable.

The references to education of senior management, Directors and Supervisors just doesn't make sense because none have participated in anything related to education. 

And why does the credit union report spending on Ambassadors when the only payment issued to ambassadors is a $25.00 as reimbursement each time they attend meetings. .

The annual meeting is conducted once a year in South Pasadena and always, in the month of May. Why then, does Priority One continue to report monthly spending on a meeting which took place 6 months ago? 

What Priority One most needs is an in-depth audit of all its financials. We believe the suspicious looking entries are just part of the President's way of shuffling around figures, to make the report more palatable to readers. . 

MONTHLY INCOME STATEMENT

OCTOBER 2009

Less Allowance for Loan Losses        

$ 2,600,000.00

Net Loans

$ 106,778, 903.74

Cash

$ 2,468,259. 31

Education Expense-Staff

$2970.28 Month-to-date

$14,278.16 Year-to-date

Education Expense - Senior Mgmt

$750.00 Month-to-date

5361.08 Year-to-date

Education Expense - Supvry Comm

Month-to-date

$515.20 

YTD

$9742.46 Year-to-date

Education Expense - Board Directors

YTD

$960.00 

Training Expense

Month-to-Date

$840.50

YTD

$13,628.27  

Ambassadors   

YTD

$4611.57 

Provision for Loan Losses             

Month-to-Date

$71,047.90 

YTD

$2,453.169.19 

NCUSIF Stabilization Expense

YTD

$1,111,125.75

Annual Meeting Expenses

Month-to-Date

$1058.40 

YTD

$67,181.54 

Board of Directors/Supervisors

Month-to-Date

$899.80

YTD

$11,214.56  

Mileage and Reimbursement

Month-to-Date

$3633.65

YTD

$35,515.70 

Net Income/Loss

Month-to-Date

-$133,503.84 

YTD

-$4,557,061.65 

The credit union's financials, even when tampered with, prove this is a credit union that has been thrust into a state of failure by Charles R., Wiggington, Sr. When faced with the challenge of forging resolutions for what he created, he instead indulges in launching verbal campaigns asserting Priority One's revitalized business, plotting scathing attacks against employees, and hammering out outrageous stories about all he's accomplished and tall tales about some invisible group of ninja-like employees who driven by jealousy, are out to toppled his empire. It's all delusions of grandeur and a deep-seeded need to play the victim as part of his gambit to deter attention from his failures and abominable personal behaviors. 

Wise men don't need advice. Fools won't take it.

-Benjamin Franklin-

Floundering in Quicksand

REFUSAL

Since April, Priority One Credit Union's President, Charles R. Wiggington, Sr. has defied state law, refusing to post the credit union's Monthly Financial Income Statements.

We of course find his refusal more than a little peculiar when one considers his chronic declarations that business has improved. So why not post the evidence that would support your statement? He's also recently complained that he's tired of our frequent reports concerning his refusals to post the income statements. All we can say is, if your tired of reading about your refusals, then post the statements. 

Here again is the California code which describes the credit union's obligation to post the statements:

California Code of Regulations, Title 10, Chapter 1, Section 30.701(c): 

The Credit Union shall post copies of its statement of financial condition and statement of income in a conspicuous place in each office of the credit union or at a place convenient to the members as designated by the board of directors, where they shall remain posted until replaced by the financial statements of the next succeeding month. In lieu of posting copies of such financial statements, a credit union may post a notice in a conspicuous place in each office of the credit union stating that copies of the financial statements are available upon request, and the credit union shall make copies of the financial statements available to members upon request."

Having grown weary of President Wiggington's frequent defiance of state law, a member of the credit union recently filed a complaint with the DFI. The DFI contacted the President by phone and were told by President Wiggington, himself, that the financials have always been posted at all branches. The President lied. Not only did he lie to the DFI, but he immediately afterwards, called the Los Angeles, Van Nuys, Burbank, and Redlands branches and informed them that they would each be provided current statements, later that same day. 

The DFI whose investigation was minimal, at best, sent the following email to the member who filed the complaint:

The CEO of the Credit Union was contacted, and he stated that the statements are posted at each branch office. He did mention that there was a problem at their Valencia office recently where the current statements had not been posted and what was posted was stale dated. He indicated that this was corrected and the manager of that location was informed that the financials were to be posted as soon as they were received. He also stated that you may request copies of past financial statements, if you like. 

If you would like to file a complaint against the Credit Union, please let us know. 

Thank you, 

Consumer Services Office 

California Department of Financial Institutions

President Wiggington may not be an expert liar, but he is a liar. The member accepted the DFI's invitation and filed a second complaint. During the week of July 6th, the President received a letter from the DFI, accompanied by a form requiring his completion and signature. On Monday, July 13, 2009, the financials for the month of June were finally posted at all branches. The President was forced to concede to state law. It's obvious that President Wiggington would never have tried to hide the financials if business were actually as good as he says it is and his refusal to post the statements attests to his character and dishonest proclivities. 

MEANINGLESS ASSURANCES

As reported previously, during this year's annual meeting, the apparently nervous and heavily perspiring President assured attendees that the credit union remains financially sound though exerting every effort to hide the credit union's Monthly Income Statements. 

During the same meeting, Board Chair, Diedra Harris-Brooks said little about the credit union's actual documented financial performance and she announced that the Treasurer's Report would be read, however, the report was never read. 

Supervisory Committee Chair, Cornelia Simmons, declared as she does year after year, that the credit union is financially sound. If Priority One's performance were sound, why hide the monthly financials in defiance to state law and why would Mrs. Harris-Brooks have announced during the annual meeting that the Treasurer's Report would be read and then fail to read it? 

Prior to the start of the meeting, copies of the 2008 Annual Report were distributed though the contents of the report were never read or discussed during the 30-minute meeting which followed. However, we've reviewed the report and it shows that the year-to-date amount of Net Income is $4 million in the RED.  So how did Cornelia Simmons determine that $4 million in the negative is an indicator that Priority One's financials are sound? 

Last March, a reader sent us the following message:

If the NCUA takes over POCU..... and if you ask me to bet, I would say the clock is ticking... your blog is well known in the industry so I gotta believe that the DFI and NCUA are watching.I was looking around the POCU web site for the Annual Meeting date because one of your readers inquired, but before I could find the date, I found something that should catch some attention and make for an entertaining post if you’re interested. 

On the front page of their site they are advertising a $100k CD at 3.3% APY and a new auto loan rate of 3.49% APY. It doesn't take a rocket scientist to know that when you only have a spread of 19 basis points you’re going to lose money. Even if they had 0% charge-offs, which of course they won’t, they would lose money because their overhead per loan costs more than 19 bp. And that’s not including marketing costs or the fact that since they are already hemorrhaging money. How exactly can the afford to do this?

A few weeks later, the same reader sent us another message:

I do not see how they can save this ship. I seriously have to believe that 

1) They will be merged by 12/31; or, 
2) they will be liquidated by 12/31/09. 

Sad, really sad

We also received the following comment from another reader in response to our last post:

What happened to the election? The balance on the 20 million that was borrowed has not gone down. Or are they are making interest payments only!!!!!!!!!! $600,000.00 in interest payments

We've not calculated the actual amount that has been spent in interest alone against the $20 million loan borrowed in mid-2008 by President Wiggington. The credit union's finanical statements reference that payments made by the credit union approximate between $30,000 and $33,000 per month. What's more, the payments are only submitted to pay interest on the loan amount. Depending on when the loan may eventually be paid off in its entirety, the amount paid in interest may in fact exceed $600,000. Is this an example of the President's effort to work "smarter"?  

The June 2009 
Monthly Income Statement

The President has finally posted the credit union's Monthly Income Statement, albeit it against his will. Here are the figures:

ASSETS
Loans $114,441,315.16

Less: Allowance for Loan Losses

$2,600,000.00

Net Loans:

$111,841,315.16

Accounts Receivable

$1,036,230.02

Cash

$2,997,023.33

Investments

$62,057,332.22

Investment in COOP

$40,000.00

Investment in FSCC

$24,000.00

NCUA Deposit

$1,284.522.90

Accrued Income

$843,700.12

Prepaid Expenses

$476,376.77

Other Assets

$0.00

Sub-total

$180,709,370.61

Fixed Assets

$9,175,751.99

Less Accumulated Depreciation

$5,838,158.02

Net Fixed Assets

$3,337,593.97

Total Assets

$184,046,964.58

LIABILITIES AND EQUITY

LIABILITIES

Accounts Payable

$120,038.94

Notes Payable

$20,000,000.00

Accrued Expenses

$364,530.64

Dividends Payable

$0.00

Suspense Accounts

$0.00

Other Liabilities

$13,888.06

Shares

$150,756,281.89

Total Liabilities

$171,254,739.53

EQUITY

Regular Reserve

$5,128,606.33

Undivided Income

$7,663,618.72

Total Equity

$12,792,225.05

Total Liabilties and Equity

$184,046.964.58

Operating Income

$535,454.75

Income from Investments

$136,895.09

Fees and Charges

$231,672.78

Miscellaneous Operating Income

$16,478,12

TOTAL OPERATING INCOME

$920,500.74

OPERATING EXPENSES

Employee Salaries/Bonus

$323,737.86

Temporary Personal

$0.00

Personal Time Off

$16,916.34

Employee Pension Plan

$6,167.06

Workers Compensation Insurance

$4024.25

Employee Medical Insurance

$28,328.25

Medicare Expense-Employer

$4169.67

Social Security Taxes-Employer

$17,828.94

FUTA Expense- Employer

$143.66

SUI Expense- Employer

$736.24

Life/Disability Insurance- Employer

$1867.14

Credit Union League Dues

$2268.67

Membership, Dues, & Subscription

$2428.67

Branch Lease

$15,460.98

Property Taxes

$2542.01

Janitor Expense

$4035.75

Utility Expense

$5151.85

Building Maintenance

$1045.00

Depreciation-Building

$14,277.24

Security Expenses

$5924.69

Telephone Expenses

$24,608.94

Postage

$9807.51

Share Draft Expenses

$2463.83

Equpment Maintenance

$28,280.91

Stationeries and Supplies

$10,282.62

Surety Bond Premium & Other Insurance

$9857.67

Depreciation- Furniture and Equipment

$32,611.76

ATM Expense

$19,564.80

Check Card Expense

$20,788.15

Technology and Computer Expense

$18,960.35

Miscellaneous Bank Charges

$1951.87

Education Expense-Staff

$79.00

Education Expense-Senior Management

$0.00

Education Expense-Supervisory Committee

$0.00

Education Expense-Board of Directors

$0.00

Training Expense

$0.00

Advertising Expenses

$1200.00

Loan Promotions

$5,298.62

Promotional Items

$0.00

Member Research

$0.00

Ambassadors

$743.96

Business Development Expense

$488.50

Collection Expense

$1251.54

Real Estate Expense

$0.00

Indirect Dealer Fee

$0.00

VISA Expense

$0.00

Credit Investigation Expenses

$5248.44

Lending Center

$3858.81

Lending Expense

$$0.00

Legal Expenses

$19,241/93

Audit Expenses

$3500.00

Consultancy Fees

$5156.62

Associated Management Company

$0.00

Shared Branching Expense

$5371.00

CUSO Expense

$0.00

Provision for Loan Losses

$66,792.01

Borrower's Insurance

$0.00

NCUSIF Stablization Expense

-$160,551.94

DFI Admin. Fee

$2842.00

Cash Short (and Over)

$535.09

Interest on Borrowed Money

$58,561.65

Annual Meeting Expense

$39,908.43

Board of Directors/Supervisors

$801.35

Annual Retreat

$0.00

ADP Charges

$3140.70

Credti Union Car Expenses

$116.87

Commissary

$608.34

Mileage and Reimbursements

$3310.85

General Expenses

$9078.62

Courier Services

$9954.11

Storage Expenses

$2827.82

Branch Expenses

$0.00

Other Losses

$3727.05

Merger Expense

$0.00

Succession/Strategic Planning

$0.00

Ballot Incident Expense

$0.00

Total Operating Expenses

$733,323.44

Income (loss) from Operations

$188,177.30

Dividends Paid

$148,956.35

Loss (Gain) on Disp of Assets

$0.00

Loss (Gain) on Disp of investment

-$886,456.66

Franchise Tax Board

$0.00

Total Dividends & Other Income

-$737,500.31

Net Income (Loss)

$925,677.61

Net Income (Loss), Year-to-Date

-$3,915,781.79

NET INCOME obtained from the credit union's Quarterly Financial Reports filed with the NCUA 

Quarter Ending June 2008

$63,517

Quarter Ending September 2008

$73,364

Quarter Ending December 2008

-$690,652

Quarter Ending March 2009

-$3,470,435

Quarter Ending June 2009

-$3,915,782

No wonder the President felt emotionally driven to hide the credit union's financials. Priority One remains in the negative, but didn';t President Wiggington; Board Chair,  Diedra Harris-Brooks; and Supervisory Chair, Cornelia Simmons, describe the credit union as financially sound? Is there anytime when a negative Net Income balance indicates financial soundness? 

TWISTED

President Wiggington has a convoluted perception of what constitutes "thinking smarter." He implements a company wage freeze and reduces budget and then hires a COO. His alleged efforts to stabilize losses are chronically undermined by excessive spending. Not only have his decisions, like choosing to spend money on a $600,000 phone system and unnecessary updated email system, diminished the credit union's financial standing but his personal undisciplined behaviors, like his sexual harassing of a former female employee, have forced the credit union to spend monies on attorneys, investigators and consultants. What's more, during his approximate 6-week suspension, during which an investigation was conducted, the Board Chair, Diedra Harris-Brooks, deemed it prudent to place him on suspension with pay though all non-exempt personnel when suspended, are done so without pay. 

What's more, a few weeks following his reinstatement, the President was paid over $7000 for unused sicktime. Shouldn't he  have been ordered to pay for all attorney and investigation costs, particularly when the evidence proved he had indeed sexually harassed the former employee?

President Wiggington, the Board Chair and some of his other executives are depleted the credit union's financial resources, making certain that they remain employed and that they are allotted wage increases and bonuses. 

CONSCIENCE IS GOD'S PRESENCE IN MAN

Emanuel Swedenborg, Arcana Coelestia, sec. 4299