UNITED STATES OF AMERICA

BEFORE THE NATIONAL CREDIT UNION ADMINISTRATION

In the Matter of

xxxxxxxxxxxxx                               Docket  98-INS-004

Insurance Claim

Decision and Order on Appeal

Decision

This matter comes before the National Credit Union Administration Board (Board) pursuant to 12 CFR 745.202 as an administrative appeal of the determination by the Agent for the Liquidating Agent of Germantown Federal Credit Union denying xxx xxxxxxx insurance claim in the amount of xxxxxxxxx. 

Background

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx, opened a joint account in Germantown Federal Credit Union in March,1993.  xxxxxxxxx was the joint owner on the account.  In May of 1994, xxxxxxxxxxxx died.  Approximately two and half years later, in October 1996, NCUA placed Germantown Federal Credit Union into involuntary liquidation due to insolvency.  As liquidating agent for Germantown Federal Credit Union, NCUA entered into a purchase and assumption agreement with Sentry Federal Credit Union whereby member accounts were transferred to that credit union.  Sentry Federal Credit Union has maintained the Germantown facility as a branch office.

xxxxxxxxx first attempted to access the account in late 1996 or early 1997, after the liquidation, and was informed that there was a discrepancy between the account balance on the credit union’s records and that claimed by xxxxxxxxx.  Sentry Federal Credit Union directed her to NCUA’s Asset Management and Assistance Center (AMAC) because the deposit was allegedly made in 1993, prior to the purchase and assumption.

xxxxxxxxx supplied an account passbook and cash received voucher as evidence of the account.  Both the passbook and voucher have handwritten entries.  The voucher form has a line for credit union staff to initial; it is left blank.  The only evidence of the opening of the account located by Sentry Federal Credit Union staff is a computer generated record showing a xxx dollar opening balance, dated March 9, 1993.  Information on trial balances obtained from Sentry Federal Credit Union show a xxx balance at year-end 1993 and year-end 1994.  Account statements sent to xxxxxxxxx covering the period from March 1, 1995 through March 31, 1997 reflect only a  xxx deposit.  Based on available evidence, AMAC denied xxxxxxxxxxx claim and she filed this appeal with the Board.

After she submitted her appeal, and at NCUA’s request,xxxxxxxxx submitted an affidavit wherein she attested as follows: 1) xxxxxxxxxxxxxxxxxxxxxxxx, opened joint xxxxxxxxxxxxxxx (with xxxxxxxxx as joint owner) at Germantown Federal Credit Union  on March 8, 1993, with a cash deposit of xxxxx; 2) xxxxxxxxxxxx died in May, 1994; and 3) no other deposits were made to nor were any withdrawals made from the account.  

Other than the passbook, voucher and her affidavit, xxxxxxxxx presented no other evidence to substantiate that the passbook balance was in fact the balance at the time of her attempt to access the account.  The trial balances for 1993 and 1994 and the 1995 - 1997 account statements all show an account balance of only xxx.  Although a xxxx deposit may have been made in 1993, xxxxxxxxx may not have been aware that her mother made withdrawals prior to her death.  However, the account statements sent to xxxxxxxx, beginning with the March 1995 statement issued over 18 months prior to the liquidation of Germantown Federal Credit Union, put xxxxxxxxx on constructive, if not actual notice, that the account balance was only xxx.  Taken together, the evidence does not substantiate an existing balance of xxxxx.

Order

For the reasons set forth above, it is ORDERED as follows:

The Board upholds the Liquidating Agent’s decision to deny the xxxxxxxxxxx claim in the amount of xxxxxxxxx and denies xxxxxxxxxxx appeal.

The Board’s decision constitutes a final agency determination.  Pursuant to

12 CFR 745.203(c), this final determination is reviewable in accordance with the provisions of Chapter 7, Title 5, United States Code, by the United States Court of Appeals for the District of Columbia or the court of appeals for the Federal judicial circuit where the credit union’s principal place of business was located.  Such action must be filed not later than 60 days after the date of this final determination.

So ORDERED this 30^th day of July, 1998 by the National Credit Union Administration Board.

                                                            _____________________

                                                            Becky Baker

                                                            Secretary of the Board