Disgruntled Members Seek Board Ouster at Failed CU Convert

Credit Union Journal   Tuesday, February 19, 2008

ODESSA, Texas – Members fighting the conversion of First Basin CU to mutual savings bank say they will seek the recall of the directors of the $110 million credit union after they terminated their efforts to switch to a bank charter.

"We feel the credit union board does not represent the best interests of the credit union," said Letty Moreno, a former credit union employee and head of Save First Basin, an ad hoc group of members opposing the bank-bid.

Moreno said members felt the suspension of the conversion ballot just days before the 90-day vote was scheduled to culminate in a special meeting was suspicious. "We speculate they (the board) were probably losing," she told The Credit Union Journal yesterday.

The members group is calling on credit union management to make the voting results public.

The recall of the board after a failed conversion to savings bank has been tried three times in recent years, all unsuccessfully.

In a letter to members last Friday, First Basin President Shem Culpepper said they decided to suspend the vote because they believe members were receiving false information indicating they would lose their deposits if the vote was successful. In lieu of the conversion, First Basin will now explore whether they can legally return some of the credit union’s equity to members as a special dividend, Culpepper told the members.

Credit union officials were unavailable to comment yesterday.

The suspension of the First Basin vote comes as the results of another member ballot to convert to mutual savings bank, Beehive CU, in Salt Lake City, is expected to be announced later this week.

© 2008, Used with permission from The Credit Union Journal. All rights reserved.

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