BRIARWOOD, N.Y.—NCUA Friday liquidated troubled Melrose Credit Union.
NCUA said Teachers Federal Credit Union, of Hauppauge, N.Y., has assumed all of Melrose’s members and shares as well as some loans and other assets.
The former multi-billion-dollar-asset CU was conserved in February of 2017 after suffering massive losses from bad taxi medallion loans. As CUToday.info reported, those losses continued, and late last year the credit union’s capital went negative.
As CUToday.info reported, the credit union has also suffered from allegations that its former CEO, Alan Kaufman, may have committed one of the largest and long-lasting frauds in credit union history, with allegations including the personal approval of more than $185 million in questionable loans, free luxury trips and other travel for himself and wife from the New York Jets and other vendors, a free residence, a bogus naming rights deal, and even free limousine rides for himself and his extended family.
Most recently, Melrose was part of a federal investigation of President Trump's former attorney, Michael Cohen, for $20 million in loans obtained by Cohen, some allegedly from Melrose.
Teachers Federal Credit Union serves 300,541 members and has assets of nearly $6.1 billion, according to the credit union’s most recent Call Report.
The NCUA said it has retained some Melrose loans.
The existing Melrose office located at 13930 Queens Blvd., Briarwood, will remain open, NCUA said.
NCUA said it made the decision to liquidate Melrose and discontinue its operations after determining the credit union was insolvent and had no prospect for restoring viable operations.
At the time of liquidation and subsequent purchase by Teachers FCU, Melrose served 19,864 members and had assets of approximately $1.1 billion, according to the credit union’s most recent Call Report.
Melrose is the fifth federally insured credit union liquidation in 2018.