HOOLEHUA, Hawaii—The only two permanent employees of a now defunct tiny CU here have been charged with embezzling more than $1 million.
Allennie Naeole, 55, and Janell Purdy, 40, were arrested this week as a result of a federal indictment charging them with embezzling more than $1 million from the former $3.1-million First Hawaiian Homes Credit Union here.
In December 2015, NCUA liquidated First Hawaiian Homes stating the decision was made after determining the credit union was insolvent and had no prospect for restoring viable operations. Community Federal Credit Union of Kaunakakai, Hawaii, immediately assumed First Hawaiian Homes’ assets, member shares and most loans.
The Department of Justice reported that Elliot Enoki, Acting United States Attorney for the District of Hawaii, said that a federal grand jury returned a fifteen-count indictment against Naeole, the former CEO, and Purdy on November 8, 2017. The indictment charged both individuals with conspiring to embezzle, and embezzling, funds belonging to the First Hawaiian Homes Credit Union between 2008 and 2015.
According to the indictment, Naeole and Purdy were the only two permanent employees of First Hawaiian Homes, and were responsible for conducting all of its banking transactions and maintaining its books and records. The indictment alleges that the two individuals issued checks from First Hawaiian Homes’ accounts to pay personal expenses for Naeole and her family members, including credit card bills and car payments. Naeole and Purdy also withdrew more money than was on deposit in their own bank accounts and those belonging to their family members, and used the money to pay personal expenses. The withdrawals created negative balances in the accounts, which Naeole and Purdy concealed by making fictitious entries in First Hawaiian Homes’ records, the Justice Department stated.
The indictment also alleges that Naeole took steps to conceal the embezzlements from First Hawaiian Homes’ board of directors and NCUA. According to the indictment, Naeole falsified records, created a letter bearing a forged signature and falsely claiming that First Hawaiian Homes had assets at another bank, and created a fictitious email account to communicate with the NCUA.
The indictment charges both individuals with one count of conspiracy and six counts of embezzlement, and Naeole with one count of making a false document and one count of aggravated identity theft.
If convicted, the defendants face up to 30 years’ of imprisonment and a fine of up to $1,000,000, as to each of the embezzlement charges, and up to five years’ imprisonment and a fine of up to $250,000 for the conspiracy charge. Naeole separately faces up to five years’ imprisonment and a fine of up to $250,000 for the false document charge, and a mandatory two-year term of imprisonment and a fine of up to $250,000 for the aggravated identity theft charge, the Justice Department stated.
Naeole was arrested on Molokai, and Purdy was arrested on Maui. Purdy was brought to federal court, where she pled not guilty to all charges and was released on bail. Trial was set for January 9, 2018. Naeole will be arraigned on the charges on November 14, 2017, the DoJ stated.