Former San Diego County CU Executive Files Whistleblower Suit

A former senior executive at San Diego County CU filed a whistleblower lawsuit against the $6 billion credit union in state court late last month claiming he was fired because of complaints he took to the CEO, the board of directors and to NCUA examiners about processing glitches that could have required the credit union to reimburse members millions of dollars.

Scott Norris, a senior vice president at the credit union until his termination in May, claims wrongful termination in his lawsuit filed in San Diego Superior Court. The suit was filed after the California Department of Fair Employment and Housing issued him a "right to sue."

Norris, who worked at the credit union since 2005, claims he brought up various concerns with senior credit union management over mortgage fees charged without proper disclosure, about processing of real estate loan service, the tracking of delinquent property taxes; the processing of Chapter 13 bankruptcy payments made by trustees, and other irregularities that could have cost the credit union more than $2 million to resolve, both in technology work and payments to members.

He alleges his complaints were ignored by senior management, particularly CEO Teresa Halleck, and that he was eventually fired for his actions.

According to the suit, Norris discovered in 2010 that the loan-servicing program used by the credit union was not properly recording payments from borrowers. He immediately alerted Halleck, who said it would cost the organization about $500,000 to "recast" the affected loans, the suit says. Halleck did not correct the problem until March 2011, the suit claims, and even then she did not tell the affected borrowers.

A spokesman at San Diego County CU did not return several phone calls seeking comment.

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