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Credit union regulator loses case over failed CU's insurance coverage

CUMIS Insurance Society Inc. defeated the National Credit Union Administration's claim that it should pay $5 million for the failure of St. Paul Croatian Federal Credit Union, reported May 29.

CUMIS had issued a fidelity bond to the Eastlake, Ohio-based credit union back in 2010, covering employee or director dishonesty. St. Paul Croatian was placed into conservatorship that same year, and Anthony Raguz, a former COO, was accused of embezzlement.

But CUMIS argued Raguz was not covered by the bond, because former board member Robert Calevich had been aware of the executive's wrongdoing and did not disclose the information. The U.S. Court of Appeals for the Sixth Circuit agreed.