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AUSA VICKIE E. LEDUC at 410-209-4885
January 17, 2007
FOR IMMEDIATE RELEASE
ASSISTANT MANAGER OF CUMBERLAND CREDIT UNION PLEADS GUILTY TO MAKING FALSE STATEMENTS TO CONCEAL LOAN DELINQUENCIES
Credit Union Losses Exceeded $500,000
Baltimore, Maryland - Richard W. Shives, age 49, of Cumberland, Maryland, pleaded guilty today to making false statements to the National Credit Union Administration, announced United States Attorney for the District of Maryland Rod J. Rosenstein.
According to the plea agreement presented to the court, Shives was the assistant manager of the City, County State of Allegany County Federal Credit Union (CCSAC) in Cumberland, Maryland, overseeing loans and collections, and supervising the tellers. He had been an employee of the CCSAC for about 19 years.
To disguise the financial condition of the credit union on delinquent loans to customers, Shives extended the loan due dates and re-financed the loans which were under-collaterized, not collaterized at all, or made to appear collaterized when in fact the collateral had been sold by the customer. Shives made loans to customers whose previous loans were delinquent and who had inadequate credit history. Shives caused reports to the National Credit Union Administration to falsely understate the number and amount of outstanding delinquent loans, and overstate credit union income.
Shives caused credit union members to be unaware of their financial situation. He required CCSAC customers to sign blank loan documents which he subsequently completed whenever those customers became delinquent in loan payments, in order to extend new credit or re-finance old loans. Shives caused customers not to receive quarterly loan statements or delinquent notices, and collection officers not to call delinquent customers.
For 12 credit union members who received special treatment from Shives, losses to the credit union exceeded $500,000.
Shives faces a maximum sentence of 30 years in prison followed by three years of supervised release and a fine of $1 million. U.S. District Judge William M. Nickerson scheduled sentencing for April 17, 2007 at 9:30 a.m.
United States Attorney Rod J. Rosenstein praised the investigative work performed by the Federal Bureau of Investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Joyce McDonald, who is prosecuting the case.
This page last modified—January 17, 2007