2 former credit union employees barred; one of them to pay $1.2 million restitution

Two former employees of credit unions in Tennessee and New York were barred in May from future participation in the affairs of any federally insured financial institution, with one of those employees receiving a jail term and ordered to pay more than $1.2 million in restitution, the National Credit Union Administration (NCUA) announced Friday.

The NCUA said that Sherry Ann Allen, a former employee of Greater Eastern Federal Credit Union in Johnson City, Tenn., pleaded guilty to the charges of theft and tax evasion. NCUA notes that, besides having to pay restitution, Allen was sentenced to 51 months in prison and three years’ supervised release. (The payment of restitution, according to court documents, includes $984,376.04 to be paid to Greater Eastern Federal Credit Union and $253,171 to the IRS.)

Also in May, Jihan Michelle Davis, a former branch manager of Lexington Avenue Federal Credit Union in Rochester, N.Y., agreed and consented to the issuance of a prohibition order and agreed to comply with all of its terms to settle and resolve the NCUA Board’s claims against her, the agency said. According to the order, NCUA found that Davis, while employed at the credit union, “falsified credit union records and converted credit union funds for her own use.”

Violation of a prohibition order is a felony offense punishable by imprisonment and a fine of up to $1 million.

NCUA Issues Prohibition Notices