ItāsĀ the kind of story that shakes a credit union to its core ā not becauseĀ itāsĀ about a stranger breaking in, but becauseĀ itāsĀ about someone who had the keys all along. A long-time Kansas credit union manager was recently sentenced to more than five years in prison for embezzling over $750,000 from her employer,Ā The theftĀ didnātĀ just drain the institutionās accounts; it threatened the very safety and soundness of the credit union.Ā
For three decades, this manager held the trust of both her employer and community.
Her role gave her full control over the credit unionās finances ā authority she used, over time, to divert funds for her own use.
With such tenure and trust, few questioned her decisions, and even fewer looked over her shoulder.
AndĀ thatāsĀ where the real lesson lies.Ā
Oversight is not just for new employees.
In fact, long-term employees can sometimes pose an even greater risk. They know the systems inside andĀ out,Ā theyāveĀ earned deep trust, and they often receive the benefit of the doubt. But trust should never replace verification.Ā
ItāsĀ easy to focus compliance efforts on onboarding and training ā but consistent internal controls, regular audits, and independent reviews are just as critical for long-serving staff. TenureĀ doesnātĀ eliminateĀ risk; it can sometimes conceal it.Ā
The Muddy River case is a sobering reminder that even decades of good serviceĀ donātĀ exempt anyone from accountability.
Healthy oversight protects everyone ā the organization, its members, and yes, even thoseĀ whoāveĀ earned the most trust.Ā
Author: Bev Evancic
Bev.Evancic@ResourceManagement.com
Bev Evancic is a Senior Vice President at Resource Management Services, Inc.Ā Prior to employment at RMS, Bev worked as the Collection and Recovery Manager at AT&T Universal Card,Ā Citi,Ā and Federated Department Stores. Bev started in the collection industry as a collector at an upscale clothing store in Cincinnati, Ohio. As a returned check and private label credit card collector, Bev gained a basic understanding of the collection industry that has not changed with the introduction of regulations. Her collection philosophy begins with the idea that businesses and customersĀ benefitĀ from preserving the customer relationship. First, collectors need toĀ attemptĀ to contact customers when it is convenient for the customer to discuss his/her financial condition and willingness/ability to pay.Ā Second,Ā you never collect money by intimidating or threatening customers. Third, businesses must make sure the debt is valid.Ā
She has managed all phases of collection and recovery operations, including automatedĀ dialer units,Ā bankruptcy,Ā and legal units, skip tracing units, internal collections, outside collection agency networks, and Consumer Credit Counseling. As a Consultant for ResourceĀ Management Services, Inc., Bev has spearheaded collection and recovery best practices reviews for many top credit grantors. Her articles on dialer operations, agency management and bankruptcy best practices have been widely publicized.Ā
She is well known and regarded as a specialty expert in the areas of: Repossession, Bankruptcy, Estate, Litigation, as well as Pre- and Post- Charge-off.Ā Prior to joining Resource Management Services, Inc. in 1995, Bev managed the Recovery Department for AT&T Universal Card Services where she developed the bankruptcy, probate, internal and litigation processes.Ā
She is the author of āRecovery Management: Collecting the Uncollectible Account.
