| In the Matter of
PAUL D. ALLEN
An Institution Affiliated Party and
|
Docket No. 98-0801-III |
Pursuant to Section 206(i)(1) of the Federal Credit
Union Act, 12 U.S.C. §1786(i)(1), you are hereby notified
that you are prohibited from participating in any manner in the
affairs of any federally insured credit union. This prohibition
results from activities you engaged in during your affiliation
with Charleston Naval Shipyard Federal Credit Union. This prohibition
is effective immediately upon service. In accordance with Section
206(g)(7)(A) of the Federal Credit Union Act, 12 U.S.C. §1786(g)(7)(A),
this Order shall constitute a prohibition from further participation
in any manner in the affairs of any federally insured financial
institution, or other entity identified therein, without the written
permission of the appropriate federal regulatory agency. This
Order has been issued based upon the following information.
You pleaded guilty to one count of Title 18, United
States Code, Section 1344, financial institution fraud. You were
sentenced on November 13, 1997, by the U.S. District Court for
the District of South Carolina, to probation for three years and
ordered to pay restitution in the amount of $14,500. A copy of
the Judgment in a Criminal Case, dated December 3, 1997, is attached
to this Order as Attachment 1 and is incorporated by reference
herein. Because an appeal has not been filed within the time
specified by the Federal Rules of Appellate Procedure, your conviction
is now final.
The offense of which you were convicted, financial
institution fraud, was committed while you were employed as the
President and Chief Executive Officer of the Charleston Naval
Shipyard Federal Credit Union of Charleston, South Carolina.
The information to which you pleaded guilty alleges that from
December 1985 until at least December 1988, you devised a scheme
to defraud the Charleston Naval Shipyard Federal Credit Union
by having checks issued for fraudulent purposes. It appears that
you directed credit union checks to be drawn payable to the Medical
University of South Carolina, ostensibly for charitable contributions,
scholarships or advertising. In fact, the checks were being used
to pay the medical school tuition for your son-in-law, Brandon
Smith. During this three year period, checks totally $14,500
were paid by the credit union for this fraudulent purpose. At
the time of your criminal actions, Charleston Naval Shipyard Federal
Credit Union was a federally-chartered credit union.
The offense to which you pleaded guilty involves
personal dishonesty and breach of trust. Your continued participation
in the affairs of any federally insured credit union may pose
a threat to the interests of credit union members and may threaten
to impair public confidence in the credit union involved.
Pursuant to Section 206(i)(3), of the Federal
Credit Union Act, 12 U.S.C. §1786(i)(3), you may request
in writing, within thirty days of service of this Order, an opportunity
for a hearing at which you may present evidence and argument that
your continued participation in the affairs of any federally insured
credit union would not, or would not be likely to, pose a threat
to the interests of that credit union's members or threaten to
impair public confidence in the credit union. Any such request
should be sent to: Secretary of the Board, National Credit Union
Administration, 1775 Duke Street, Alexandria, VA 22314-3428.
This hearing will be held in the Washington, D.C. metropolitan
area, or such other place as designated by the Board, in accordance
with Subpart D of Part 747 of NCUA's Rules and Regulations, 12
C.F.R. §747.301 et. seq.
Pursuant to Section 206(k)(2) of the Federal Credit Union Act, 12 U.S.C. §1786(k)(2), any violation of this Order may subject you to a Civil Money Penalty of up to $1,000,000.00 a day for each day said violation continues. In addition, pursuant to Section 206(l) of the Federal Credit Union Act, 12 U.S.C. §1786(l), any violation of this Order is a felony offense that is punishable by imprisonment of up to five years and a fine of up to $1,000,000.00.
This is to certify that I have served the foregoing Order of Prohibition in the Matter of Paul D. Allen, by depositing the same with the U.S. Postal Service, certified mail, return receipt requested, addressed to Paul D. Allen, 108 Brandywine Drive, Summerville, SC
29485.
8/18/98_______ ________--S--_______________