VIDN_LicenseToSteal

VI_DAILYNEWS/PAGES [A01] | 04/30/12 19:40 | CHESLIKSTE

ONE DOLLAR www.virginislandsdailynews.com ISSN 2159-3019

Copyright © 2012 Daily News Publishing Co. MONDAY, APRIL 30, 2012 81st year, No. 22376

81

Licenseto steal

Special 2-month Daily Newsinvestigation discovers howa man with a criminal record

operated a credit unionin the Virgin Islands

and the V.I. governmentdid nothing to stop him

Pages 2 to 12

CarnivalCarnivalPages 28-39Pages 28-39

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DAI EWSLY N81

Gov. John deJongh Jr. pickedWayne Biggs Jr. inMarch 2009 toreplace Kenrick Robertson as head of the Department of

Licensing and ConsumerAffairs.Biggs told The Daily News that not long after he took over the

department, he learned that he was responsible for oversight ofnon-federally insured credit unions.“If they are not federally chartered, they are regulated by us,” he

said. “They are licensed by us.”Biggs also learned that only one of the six credit unions in the

territory does not have federal insurance: That one is HerMajesty’s Credit Union.

TheV.I. law regarding credit unions does not establish any regu-lations, it simply stipulates which government entity will be incharge. That agency is the DLCA, and the lawmakes the commis-sioner responsible for drafting rules and regulations for creditunions.The lawwent into effect 41 years ago, in 1971, but still the

DLCAhas no rules and regulations for credit unions.“We’re actually in the process of doing some of that now,”

Biggs said.The file on HMCU, which The Daily News requested under

theV.I. Open RecordsAct, did not contain copies of any rules orregulations.“There are no rules and regulations,”

DLCAcounsel Frederick Norford said.Biggs said the DLCAdoes not havethe resources or the expertise to properlyoversee HerMajesty’s Credit Union.Most states find that the National

Credit UnionAdministration’s rules andregulations work well, and they adoptthose instead of inventing their own.Biggs, however, has turned instead

to another part of theV.I. government:the Lt. Governor’s Office Division ofBanking and Insurance.The two agencies signed a mem-

orandum of understanding on regula-tion of credit unions in theterritory.TheMOU states the following:• DLCAwill be solely responsible

for issuing licenses to credit unionsbut will do so only after consultationwith the Division of Banking andInsurance.•Acredit union must abide by thestandard business licensing applica-tion process that includes a criminalbackground check.• Acredit union must provide

audited financial statements to theDivision of Banking andInsurance annually as well as anyother financial reports or informa-tion required by the director ofthe Division of Banking andInsurance.• The credit union will be

subject to periodic joint inspec-tions or examinations.• The credit union can be

examined every three years or

as often as the DLCAcommissioner deems appropriate for anyviolations that could lead to the business license being revoked.•DLCAwill provide enforcement officers to accompany

Division of Banking and Insurance examiners to investigate com-plaints or carry out inspections.•Both agencies shall have full access to and may compel the

production of all the books,papers, securities, transac-tions, accounts, records, doc-uments and assets of eachcredit union at any time.TheMOUwas signed by

Biggs and Lt. Gov. GregoryFrancis.It was datedMay 5, 2010,

and says the agreement willexpire in two years— justfive days from now.Biggs said he does not

know exactly what theDLCAor the Division ofBanking and Insurancehave accomplished con-cerning HMCU.Biggs said: “We have not

actively audited.We haverequested some items from them.”He did not knowwhat they have obtained.“We have received some items, can’t say exactly what we have

or don’t have, but we have received some stuff,” he said.“We’ll be auditing the entity once we get all the documentation,”

Biggs said.What is clear, however, is even after recognizing the need for the

MOU, theV.I. government has done little to protect the savings ofHerMajesty’s Credit Union members.As part of the business license application, the company is

required to have an insurance bond.If documentation of the bond exists, it was not in the HMCU file

that DLCAput together in response to The Daily News request forall documents pertaining to HMCU.“My understanding is that we have a copy of that in the file

in the office,” Biggs said, adding that legal counsel would haveto determine whether such a document is considered publicinformation.Regardless, an insurance bond is not the same thing as share

insurance, which would protect the credit union members’money.HerMajesty’s Credit Union does not have share insurance and

under both theV.I. Code and theMOU, share insurance is notrequired.Banking and Insurance Director John McDonald said the law

should be changed to move credit union regulation under hisdivision.

LICENSE TO STEAL

DLCA, Lt. Governor and Legislature ignoretheir duty to control a renegade credit union

DLCA CommissionerWayne Biggs Jr.

A SPECIAL INVESTIGATIVE REPORT BY DAILY NEWS REPORTER ALDETH LEWIN

2 The Virgin Islands Daily News Monday, April 30, 2012


LICENSE TO STEAL

The Virgin Islands Government’s lax oversight and loose laws putVirgin Islands residents at risk of losing their life savings.

Trusting the government to have rules and regulations for financialinstitutions, a number of people deposited their money into a new creditunion — but when they go to make a withdrawal, they get excuses,evasions and lies.What they don’t get is their money.Her Majesty’s Credit Union, a newcomer among financial operations in

the territory, identified itself on its website as a reputable businessheadquartered in Denver.Neither claim was true.HMCU’s home office is beside a rural Colorado airstrip in the middle of

nowhere.It is operated by a man with a criminal record, multiple aliases and a

history of failed business ventures.He currently is under investigation by the U.S. Securities and Exchange

Commission, and has been jailed in the past for refusing to cooperatewith state investigators in Colorado looking into possible fraud.A two-month investigation by The Daily News has focused on the ways

the V.I. government fails to prevent the plundering of local depositors’savings.The newspaper’s search for information extended to three states and

ultimately produced a clear picture of how inadequately the V.I.government serves or protects the people of the territory.

Feds takea close look;V.I. governmentlooks away

While the U.S. Securities and ExchangeCommission has been busy cracking

down on Her Majesty’s Credit Union, the V.I.government has assuming nothing is wrongdespite its own failure to do any oversight.Department of Licensing and Consumer

Affairs Commissioner Wayne Biggs Jr. saidthere is “no indication” the credit union is steal-ing people’s money.The SEC — the federal agency responsible

for enforcing the federal laws regulating thesecurities industry, the nation’s stock exchang-es, and other electronic securities markets —believes otherwise.On Jan. 9, the SEC issued a formal order for

an investigation “In the matter of Her Majesty’sCredit Union” and on Jan. 13, Jan. 25, Jan. 26and March 9, the SEC served HMCU and itsoperators with subpoenas for documents andtestimony.Her Majesty’s Credit Union ignored them.Running out of patience with HMCU’s delay

tactics, the SEC on March 22 asked a federaljudge in Denver to compel HMCU to producethose financial records.“It is a subpoena enforcement action,” said

Chris Friedman, an attorney in the SEC’sDenver office.The court filing reveals that the targets of the

SEC investigation are Stanley McDuffie (alsoknown as Stanley Roberson and Stanley Battle)John Williams and Jilapuhn, doing business asHer Majesty’s Credit Union.The SEC states in the filing that Her

Majesty’s Credit Union is a trade name underwhich Jilapuhn is conducting business inColorado — even though HMCU has neverbeen chartered as a credit union in Colorado, orin any other state, by the National Credit UnionAdministration.The SEC has honed in on how the V.I. gov-

ernment’s licensing of HMCU is a gateway forillegal activity elsewhere.“Since at least 2008, HMCU has purportedly

transacted business as a credit union over theInternet and from at least one office in the U.S.Virgin Islands. HMCU claims to be charteredby the U.S. Virgin Islands,” the SEC filingsays.Court documents show that the SEC is going

after possible violations of federal anti-fraudprovisions, specifically in connection withHMCU’s offer, purchase or sale of high-yield-ing certificates of deposit.“The commission staff are also investigating

whether respondents and others made mislead-ing statements or omissions regarding HMCU bymaterially misrepresenting, among other things,the safety and return rates of the investments,and the use of the investor proceeds,” the SECsays in the filing.

See LICENSE, next page

License to stealPhotos provided by FULTON COUNTY, GA.,

SHERIFF’S DEPARTMENT

Stan McDuffieChief Executive Officer of

Jilapuhn and HMCU since 2010

Stan RobersonChief Executive Officer of

Jilapuhn and HMCU before2010, Jailed for failing to

provide documents

Stanley BattlePleaded guilty to one one

misdemeanor count ofembezzling publicmoney/property

Stanley Roberson-BattleFiled for bankruptcy in 1992;charged with deposit account

fraud in 2006

See SEC, next page


Monday, April 30, 2012 The Virgin Islands Daily News 3


HMCU has a history of offering to sell—by advertising on Google and eBay —credit union certificates of deposit that itpromised would earn the buyer up to 7.75percent interest. The buyer did not evenhave to be a member of the credit union,the ads said.The state of Colorado tried to investigate

in 2010, but Stan Roberson, the man whocreated and operated Her Majesty’s CreditUnion, opted to go to jail rather than open

HMCU’s financial books.Roberson’s legal troubles arising from

financial schemes go back to 2006 andeven earlier, to 1994. Both times were inGeorgia. Each time he used a differentidentity.In 2006, the National Credit Union

Administration, which is the federal creditunion independent oversight agency, seizeda credit union that Roberson, who also usesthe surnames Battle, McDuffie andRoberson-Battle, had started in Georgia justa few months earlier. NCUA immediatelyshut down the credit union, which he had

named Jilapuhn, and liquidated the assets.Roberson was arrested and charged withdeposit account fraud.Even earlier, in 1994 while he was still a

college student, he pleaded guilty in federalcourt to embezzlement. He was sentenced tojail, given two years’ probation and wasordered to pay the U.S. Postal Service$4,279.97 in restitution.Now in 2012, even in the safe haven that

Stan Battle/McDuffie/Roberson/Roberson-Battle discovered in the Virgin Islands, he andhis credit union are under intense scrutiny —but by the feds, not by the V.I. government.

For two years, V.I. government officials have known theyare not doing a good enough job regulating HMCU creditunion — yet they have done little to change that.Now the credit union’s St. Thomas office is dark, the door

is locked and the credit union members have no access totheir money.Her Majesty’s Credit Union is a subsidiary of a company

called Jilapuhn, which in 2005 registered as a corporation inthe V.I. Lt. Governor’s Office Division of Corporations andTrademarks.That corporation is not in good standing.Jilapuhn filed a certificate of trade name for Her Majesty’s

Credit Union in 2007 but did not file articles of incorporationpapers for HMCU until Sept. 28, 2010.The V.I. Lt. Governor’s Office found the filing to be defi-

cient and did not approve the corporation.

Lies and loopholesThe V.I. Code puts the Department of Licensing and

Consumer Affairs in charge of regulating credit unions’ activ-ity in the territory — yet the DLCA has no rules governingcredit unions.In contrast, V.I. law puts the Lt. Governor’s Office

Division of Banking and Insurance in charge of regulating allbanks and other financial institutions in the territory. Thedivision has extensive rules and enforcement apparatus.The credit union loophole originated In 1969, when the 8th

V.I. Legislature added a new chapter to the V.I. Code to gov-ern incorporation, regulation, management and control of co-operative corporations, which are ones owned and run bytheir members.In 1971, the V.I. Legislature amended the law to make the

director of the Consumer Services Administration — whichlater became the DLCA— responsible for regulating co-operatives and, specifically, credit unions. The amendmentgave the director the authority to create rules and regulationsfor that purpose.Now, 41 years later, the government has no credit union

rules and regulations and has never drafted any.

Hiding behind JesusJilapuhn stands for “Jesus is Lord all praise unto his

name,” and its use as a business name by a financial institu-tion could inspire confidence among religious customers.Jilapuhn’s website spells out the name and quotes scripture.

Jilapuhn filed for a business license with DLCA in 2005and in 2008 received a DLCA license to operate a creditunion in the territory. Under the name Her Majesty’s CreditUnion, it opened in a storefront inside the Tutu Park Mall onSt. Thomas.Since then, HMCU has made numerous false claims in

order to appear legitimate.At first, the credit union claimed that it was insured by

Lloyd’s of London.It was not.HMCU plastered its bank statements and website with the

America’s Credit Unions logo, implying it was a member ofthe Credit Union National Association.It was not.HMCU advertised on its website that it was regulated by

the V.I. Department of Licensing and Consumer Affairs.DLCA does nothing to regulate the credit union.In the meantime, people were trusting their money to a con

man who was operating without scrutiny in the VirginIslands.

One man, many namesStan McDuffie is the Chief Executive Officer of Jilapuhn

and HMCU. He replaced Stan Roberson, who was jailed in2010 for failing to comply with a federal investigation intothe credit union.They are the same person.He also goes by the names Stanley Roberson-Battle and

Stanley Battle.He changes his name every time he gets into trouble.Stanley Bernard Battle was born March 7, 1966, in

Washington, D.C. He graduated from M.D. Collins HighSchool in College Park, Ga., in 1984.In July 1992, he filed for bankruptcy in Montgomery, Ala,.

under the name Stanley Bernard Roberson-Battle.In 1994, under the name Stanley B. Battle, he pleaded

guilty in federal court in Atlanta to one misdemeanor countof embezzling.He was sentenced to two years probation, a $500 fine and

ordered to pay $4,279.97 in restitution to the U.S. PostalService.Also in 1994, under the name Stan Roberson-Battle, he

received a bachelor’s degree in political science from AuburnUniversity at Montgomery, Ala.; in 1995, he received a mas-ter’s degree in human resource management from Troy StateUniversity in Montgomery.

Who and whatis Jilapuhn?

Corporate information about Jilapuhn and itssubsidiaries is murky.

Many of the same people — most of them partof the same family — have positions in everycompany.The website for Her Majesty’s Credit Union

does not list the board of directors.Its parent company, Jilapuhn, does not list a

board of directors on its website, but one of itssubsidiaries, Stateside Communications, filed anapplication with the Idaho Public UtilitiesCommission inApril 2010 and listed the Jilapuhnexecutives and the board of directors as:

OfficersCEO—Stan RobersonCFO—Cresandra BattlePresident—Valerie WilsonComptroller— JohnWesley Williams

Board of DirectorsRobert McDuffie, Washington, D.C., chairmanBarry Butler, Columbus, S.C.Patrick Masicot, St. Thomas, V.I.Yolanda Watt, Richton Park, Ill.

The Daily News found that Stan Roberson,Cresandra Battle, Valerie Wilson, John WesleyWilliams and Yolanda Watts all are related.Cresandra Battle is John Wesley Williams’

mother.JohnWesleyWilliams isYolandaWatts’brother.Valerie Wilson is related to Stanley Bernard

Roberson, who is related to Cresandra Battle.On the Jilapuhn articles of incorporation filed

with the V.I. Lt. Governor’s Office Division ofCorporations and Trademarks, the three incorpo-rators are Stan Roberson, Cresandra Battle andValerie Wilson.The business license issued by DLCA to

Jilapuhn doing business as Her Majesty’s CreditUnion also lists Stan Roberson, Cresandra Battleand Valerie Wilson.The Daily found that the information Jilapuhn

submitted to Idaho had many errors, including:Patrick Massicot’s name is misspelled as

Masicot.Barry Butler’s address is given as Columbus,

S.C., which is a town that does not exist.Yolanda Watts’ name is misspelled as Watt.

LICENSE TO STEAL


SECCONTINUED FROM PAGE 3

HMCU’s target is people from Caribbean islands, as indicated by its slogan: “Dem

people, dem credit union.” It seeks to appeal to people who have confidence in British

connections. Its full name is Her Majesty’s Credit Union, although it has no connection

to the queen of England — and it falsely claims to have Lloyd’s of London insurance. It

seeks to inspire trust by spelling out on its website and literature the name its parent

company has chosen, Jilapuhn: “Jesus is Lord all praises unto his name.”


LICENSECONTINUED FROM PAGE 3



Terms to knowCredit Union: A credit union is a nonprofit

financial institution that is governed byits members. It can be state charteredor federally chartered and must provideits members with share insurance. Thedifference between credit unions and banksis that credit unions have shares, whereasbanks have deposits. Banks are for-profitcompanies, while credit unions are not-for-profit companies. Whereas banks chargeinterest on loans, collect fees and penaltiesand reinvest all that to make more money,credit unions are owned by their members(account holders), and any profit made ispaid back to members or reinvested into theirorganization. Credit unions have a definedmembership, such as an employee group. Themembers elect the officers, and the officersare accountable to the members.

CUNA: The Credit Union National Association,a trade association for credit unions.

Federal credit union: A credit union chartered,insured and regulated by the federalgovernment.

FDIC: Federal Deposit Insurance Corporation,established in 1933 to give bank depositorsconfidence their money was safe. FDICinsures bank customers’ deposits up to$250,000 per individual per bank.

HMCU: Her Majesty’s Credit Union, anunregulated, uninsured, unincorporatedbusiness that claims to be a genuine creditunion but does not follow standard creditunion standards and practices.

Jilapuhn: Stands for “Jesus is Lord all praisesunto his name.” It is doing business in theVirgin Islands as Her Majesty’s Credit Union.

NCUA: The National Credit UnionAdministration. The NCUA is theindependent federal agency that chartersand supervises federal credit unions. NCUAoperates the National Credit Union ShareInsurance Fund, which insures the savingsof federal credit union members. It is notto be confused with Credit Union NationalAssociation, CUNA, the trade confederationof thousands of individual credit unions.

Securities: Financial instruments such asstocks, bonds and certificates of deposit.They cannot be sold legally unless they areregistered with the Securities and ExchangeCommission. To sell or attempt to sell asecurity before it is registered is a felony.

SEC: Securities and Exchange Commission. Itis the agency responsible for enforcing thefederal laws regulating the securities industry,the nation’s stock exchanges and electronicsecurities markets.

Unregistered securities: Stocks, bonds,certificates of deposit and other financialinvestment instruments that are not registeredwith the Securities and Exchange Commission.To sell or attempt to sell a financial securitybefore it is registered is a felony.

State-chartered credit union: A credit union thatis regulated by the state in which it is locatedand is subject to the laws of that state. Somestate-chartered credit unions are privatelyinsured, some are federally insured.

LICENSE TO STEAL

Daily News Photo by AISHA-ZAKIYA BOYD

Her Majesty’s Credit Union’s office in Tutu Park Mall is now closed.

Despite his prior embezzlement conviction and bankruptcy, in1997 he applied for a job with BellSouth Telecommunications inAtlanta and claims to have worked there until 2000.He did something else in 1997. He created what would

become his most ambitious venture: Jilapuhn.

Credit union failure No. 1Using the name Stan Roberson, in 2005 he opened Jilapuhn

Federal Credit Union in East Point, Ga. As a federal creditunion, it was backed by the full faith and credit of the federalgovernment, and therefore it was regulated by the NationalCredit UnionAdministration.The NCUA is the independent agency that charters and super-

vises federal credit unions. NCUAoperates the National CreditUnion Share Insurance Fund, which insures the savings of fed-eral credit union members.Jilapuhn Federal Credit Union was in operation less than a year

before the NCUAseized control and liquidated it, and onAug. 12,2006, Stan Roberson-Battle was arrested by the East Point PoliceDepartment and charged with deposit account fraud.According to the Fulton County Sheriff’s Department, he listed

his occupation as “computer tech,” and he said he was a residentof Hampton, Ga.After serving three days, he was released fromthe Fulton County Jail onAug. 15, 2006, on a $250 cash bond.The Fulton County Superior Court said it could not provide infor-mation about the disposition of the case in time for this report.“NCUA assumed control of Jilapuhn FCU’s operations on

August 26, 2005, after determining the credit union had animpaired capital position and was experiencing irresolvableproblems in the areas of capital adequacy, cash management,record keeping and management,” the NCUA announced in a2005 news release.According to the NCUA, Jilapuhn Federal Credit Union had

less than 200 members and assets of less than $150,000.Because that credit union in Georgia was insured by the fed-

eral government — up to $100,000 per account — depositorswere able to recover their funds after the shutdown.

Virgin Islands depositors have not been so lucky.

Her Majesty’s Credit UnionThe failure of Jilapuhn Federal Credit Union in Georgia did

not stop Stan Roberson from trying again. He set his sights onthe Virgin Islands, where he discovered that a lax governmentwould allow him to take people’s money without any oversight.In 2005, he applied for a V.I. business license, but he said it

was for a communications company, not a credit union. Thatapplication was for Jilapuhn Inc., doing business as JitaCommunications. Yet instead of a license for that company, hereceived a license for Jilapuhn, doing business as Her Majesty’sCredit Union. That business license was issued in 2008, DLCADirector of Licensing Knolah Nicholls-Thomas said.The Daily News requested a copy of the complete business

license file and application — which under V.I. Law is publicinformation — but DLCAwas slow to respond and would notdisclose everything in the file.DLCA attorney Fredrick Norford said some documents were

being withheld because, he claimed, the entity is under investi-gation by the Virgin Islands Inspector General’s Office.V.I. Inspector General Steven van Beverhoudt, said he would

not comment on that claim.The documents that DLCAdid provide show Stan Roberson has

been allowed to renew his business license every year since 2008.His current business license does not expire untilAug. 31, 2012.

Police did not lookRoberson’s application process at the DLCA required the V.I.

Police Department to conduct a criminal background check onhim. In November 2005, the department did the check. Thename they looked for was Stanley B. Roberson, and they foundno criminal record for him.They never took his fingerprints. They never looked outside

the Virgin Islands.The only thing the V.I. Police Department did was search its

own files, and because Roberson had not been operating in theterritory at that point, they found nothing.






Athorough background check, of the type that would be appropri-ate for someone running a financial institution, would have includeda national search using NCIC, the National Crime InformationCenter.The Police Department’s inadequate investigation and lack of ini-

tiative spotlights yet another V.I. government loophole that allowscriminals to find shelter in the territory.The DLCAfile on Roberson and Jilapuhn shows no further crimi-

nal background checks after 2005. If the DLCAhad conducted addi-tional, and more thorough, background checks on Stan Roberson,the agency would have found reason to deny him a license to oper-ate an uninsured credit union.

Trouble in ColoradoIn 2004, a year before setting his sights on

theVirgin islands, Roberson had registeredJilapuhn as a corporation in Colorado. Underthat umbrella name, he also registered StatesideCommunications, Tradewinds Financial andHerMajesty’s Credit Union.In 2010, HerMajesty’s Credit Union caught

the eye of Colorado State SecuritiesCommissioner Fred Joseph, who told TheDaily News that he saw some ads on Googlepromising 7.75 percent returns on certificatesof deposit. Because 7.75 percent is an unusual-ly high interest rate on a CD, Joseph suspected it was a scam.He also suspected that HerMajesty’s Credit Union was selling

unregistered securities— an illegal practice under federal law, pun-ishable as a felony.“The accounts they had were not federally insured, so what they

were issuing seemed to be promissory notes, and they’re not regis-tered securities,” Joseph said.Joseph noticed, too, that while the credit union was operating in

theVirgin Islands, its “processing center” was located in Colorado.Joseph subpoenaed a long list of documents and information fromStan Roberson.Roberson refused to comply.And suddenly Roberson was gone and HerMajesty’s Credit

Union had a new CEO: JohnWesleyWilliams.Williams took a defiant stance. In a letter to his attorney, Steve

Feder, dated Oct. 12, 2010,Williams sought to use theVirgin Islandsbusiness license as a weapon to try to block Colorado’s probe and toclaim that Colorado had no regulatory jurisdiction over Her

Majesty’s Credit Union.Williams said that based on aMay 2010memorandum of under-

standing between theVirgin Islands DLCAand the Lt. Governor’sOffice, HMCUmust follow all rules and regulations of the NationalCredit UnionAdministration. “The NCUAdoes not permit corpora-tions to own or be a holding company for any credit union whetherstate or federally regulated,”Williams wrote.The thrust of his argument was that the Jilapuhn corporation reg-

istered in Colorado could not legally ownHerMajesty’s CreditUnion in theVirgin Islands.“This institution will not provide any documents to any state

court, state government, representative of such nor any official ofJilapuhn Inc. as these parties do not have proper authorization toview such documents,” he wrote.

“Please understand that Mr. Roberson and Jilapuhn, Inc. do notrepresent the interest of HMCU in any capacity and are not autho-rized by this institution to do so,”Williams wrote.Williams pressed his argument further by asserting that no

employees of HMCUwere located in Denver. However,Williamshimself, the HMCU chief executive officer, was living in Denverat that time and has lived there for at least the last three years.The Daily News searched public records for any addresses for

Williams outside Colorado and found none.AColorado judge did not agreewithWilliams’position on juris-

diction and found Stan Roberson in contempt of court for failing toproduce the credit union documents the state had subpoenaed.Roberson still would not turn over the documents, and on Dec.

9, 2010, a state judge sentenced him to six months in the DenverCounty Jail.The National Credit UnionAssociation then issued a “notice of

prohibition” barring Stan Roberson from any future involvement ina federally regulated or insured credit union.Roberson then made a deal. He told the judge that he would pro-

vide the documents the investigators sought, and he got out of jailafter a month of his sentence.He did not fulfill his side of the deal.Roberson produced some— but not all— of the documents he

promised, Joseph said.Roberson then shifted to a different deception, leading Joseph to

think that the trouble was over.“He closed the operation here in Colorado,” Joseph said.That did not turn out to be accurate.He simply moved Jilapuhn’s corporate offices— out of sight to a

small airstrip in the middle of nowhere.And Stan Roberson turned into StanMcDuffie.

LICENSE TO STEAL

What happened when?July 1992: Stanley Bernard Roberson-Battle filesfor personal bankruptcy in Montgomery, Ala.

April 1994: Stanley B. Battle pleads guilty infederal court in Atlanta to one misdemeanorcount of embezzling. He is sentenced to twoyears’ probation, a $500 fine and ordered to pay$4,279.97 in restitution.

December 1997: Jilapuhn Inc. is registered as acorporation with the Georgia Secretary of State.

February 2004: Jilapuhn is registered as acorporation with the Colorado Secretary of State.

January 2005: Jilapuhn Federal Credit Unionopens in East Point, Ga.

March 2005: Jilapuhn files articles ofincorporation with the V.I. Lt. Governor’s Office.

August 2005: The National Credit UnionAdministration shuts down Jilapuhn FederalCredit Union.

September 2005: Jilapuhn is issued a certificateof incorporation by the V.I. Lt. Governor’s Officefor the purpose of banking and communications.

November 2005: Jilapuhn doing business as JitaCommunications applies for a business licensefrom the V.I. Department of Licensing andConsumer Affairs.

August 2006: Stanley B. Roberson-Battle isarrested in East Point, Ga., and charged withdeposit account fraud.

October 2007: Jilapuhn files and receives acertificate of trade name for Her Majesty’s CreditUnion from the Lt. Governor’s Office.

August 2008: Jilapuhn doing business asHer Majesty’s Credit Union is licensed by V.I.Department of Licensing and Consumer Affairsfor credit union services.

May 2010: The Lt. Governor’s Office Division ofBanking and Insurance signs a memorandumof understanding with the V.I. Department ofLicensing and Consumer Affairs about methodsto regulate credit unions in the territory.

September 2010: Her Majesty’s Credit Unionfiles articles of incorporation with the Lt.Governor’s Office, which finds the articlesdeficient, and does not accept them.

December 2010: Stan Roberson is foundguilty of contempt of court for failing toproduce documents to the Colorado SecuritiesCommission and sentenced to 180 days in jail.

June 2011: The National Credit UnionAdministration board issues an order prohibitingStan Roberson from being involved in anyfederally insured credit union.

January 2012: The U.S. Securities andExchange Commission issues a formal order foran investigation “In the matter of Her Majesty’sCredit Union.”

March 2012: Tutu Park Limited files a lawsuitagainst Her Majesty’s Credit Union in V.I.Superior Court for breach of contract. The creditunion has not paid rent since December 2010and owes $37,595.71 in back rent and fees.

March 2012: The U.S. Securities and ExchangeCommission asks a federal judge to enforcethe subpoenas previously issued for documentsfrom Jilapuhn and Her Majesty’s Credit Union.

May 6, 2012: The MOU between theLt. Governor’s Office and DLCA expires.

Fred Joseph

Daily News Photo by SEAN McCOY

Until a Daily News photographer visited Her Majesty’s Credit Union’s office in Colorado, the company’s website claimed its corporateoffices were in busy commercial complex in Denver. In reality, it turned out to be in a tiny office in a building by a rural airstrip.






A sign in the window

Kendra Prosper opened a savings account at HMCU in theTutu Park Mall on Feb. 26, 2011. Prosper came to St. Thomasfrom Dominica 10 years ago. She has a green card, and untillast month, her income came from cleaning houses. Now sheprovides in-home care to an elderly man.Prosper said a friend told her about HerMajesty’s Credit

Union, so she went to the mall to check it out. She said she waslooking for a place to open a savings account, and she liked thatHMCU did not offerATM cards so she would not be tempted tospend her savings.“At first it was OK,” she said, but then HMCU began provid-

ing excuses instead of money.In aMarch 30 interview, she said: “When I went three weeks

ago to get somemoney, the lady said ‘the system is down.’“Andevery time, I keep on going, ‘the system is still down.’”Prosper said the branch had two employees at first, but in

January, branch manager Gwenneth Clarke told Prosper she hadto fire the other teller.When “the systemwent down” and stayed down, Prosper

said, Clarke began to use carbon copy deposit slips instead of theofficial looking printed statements the credit union previouslyissued for each transaction.Prosper said Clarke accepted money from credit union

members but would not let members withdraw from theiraccounts.Clarke has refused to talk with The Daily News about HMCU.Then one day in February, Prosper and other HMCU

members showed up and found the door to HMCU waslocked and the lights were off.Asign taped to the office window gave instructions that raised

suspicions.“Please note. This branch is temporarily closed due to the ill-

ness of the Branch Employee. For all transactions please call1-888-920-0824 or go online and utilize online banking fortransactions requests at www.hmcu.net. Please check accountstatements for further updates.We apologize for the inconve-nience. Signed, CEO StanMcDuffie.”Prosper, who needed to withdraw some of her money, did

what the sign said, only to discover it led nowhere.“The number they had on the door, it wasn’t working at all,”

Prosper said.All it did was provide a taped welcomemessage and sales

pitches for HMCU.She went to the website and eventually tracked down a

Colorado phone number for Jilapuhn.After leaving a number ofmessages for the CEO, who was going by the name StanMcDuffie, she finally got him on the phone.“He said if I have money to save, I could send it to the Denver,

Colorado branch,” Prosper said.However, there is no Colorado branch for HMCU.

Prosper said Stan McDuffie also sought to reassure her bysaying that HMCU would be opening a new branch on St.Thomas on May 1. At first, he said it would be on NorreGade. Then he said it would be in Palm Passage, she said.Prosper was fed up, so she askedMcDuffie to send her the

balance in her account, which was about $565, and then closethe account.He told her he would send her a check, she said.She asked him instead to wire her the money throughWestern

Union orMoneyGram, but he told her he did not have anaccount with those businesses.In addition to dodging her demand for her money, McDuffie

—who actually is Stan Roberson—would not relinquish hishold on it.“He told me he’s not closing out my account so when they

open the new branch, I ‘could go ahead,’” and continue doingbusiness with HMCU, Prosper said.Now, a month later, there are no indications that HMCU is

opening a new branch anywhere on St. Thomas — andProsper still has not received her money and wonders wheth-

er she ever will.“This man,” Prosper said, slowly, shaking her head in doubt.

“I don’t know. I don’t know.”Another depositor, Elizabeth George, a newcomer to St.

Thomas fromDominica, also told The Daily News that she fearsshe never will see her savings again.George opened her account at HerMajesty’s Credit Union in

January. She was told the “system is down,” but she was not yetsuspicious. She made two deposits, one on Jan. 12, 2012, for$210 and one on Feb. 3, 2012, for $400.When a friend told her the credit union had closed down, she

went to the HMCU office at the mall to take her savings out.Like Prosper, George was determined to get her money.

She, too, called Stan McDuffie in Colorado, and she heard astory similar to the one he told Prosper.George said McDuffie assured her that HMCU was still

in business and was preparing to open a new branchdowntown.

LICENSE TO STEAL


At first, Her Majesty’s Credit Union deposit slips were computerized, bottom sample, but by January HMCU’s only employeeclaimed the computers were down and switched to using carbon copies, top sample.The Daily News has redacted parts of thesedeposit slips to protect the account holder’s identity.





LICENSE TO STEAL

She said he promised to send her a check for thebalance in her account.The check has not arrived, and George is desperate.“I need my money,” George said. “I’m less than a

year here. I don’t have a steady job.”She said she chose Her Majesty’s Credit Union as

the place to open a savings account because she heardthat banks require a minimum balance or a minimumamount to open the account. She said the creditunions in her native Dominica always seemed to begood, so she thought she could trust Her Majesty’sCredit Union.After she opened her account, she told her sister

about it. “She asked me, ‘you think the credit unionsafe?’ I said, ‘I think so,’” George said.“I hope we can get our money back.”

HMCU’s explanationStan McDuffie told The Daily News on March 23

that a new HMCU branch would open in a fewweeks.“The branch is temporarily closed because we only

had one employee there,” he said. “We will be open-ing up May 1.”He said the employee’s departure was sudden and

no one had a chance to tell the credit union’s mem-

bers what was going on.“It hit us by surprise as well,” Stan McDuffie said,

then he added: “That’s really all I can say right now, Idon’t want to get into talking and say something Ishouldn’t.”What he did not disclose to the credit union deposi-

tors or The Daily News was that HMCU’s landlord,Tutu Park Ltd., had taken legal action against HMCU.On March 13, Tutu Park filed a civil lawsuit in V.I.

Superior Court against Jilapuhn Inc. seeking actionfor breach of contract and debt.Tutu Park states in the suit that HMCU is “substan-

tially delinquent” in its lease obligations and as ofJan. 1, 2012, owed $37,595.71, not including fees andinterest.According to a statement dated Jan. 4, the last rent

payment the credit union made was in December2010 for $966.33.The case has been assigned to V.I. Superior Court

Judge Michael Dunston.To date, the court has received no reply from

defendant HMCU.

At the airportOn March 22, a Daily News reporter visited the

two Colorado locations that HMCU listed on itswebsite. The first one, at 12015 East 46th Ave.


The corporate headquarters for Jilapuhn, Her Majesty’s Credit Union’s parent company, in Colorado.






LICENSE TO STEAL

Today, April 30Carnival Victory (2,758) 7 a.m. to 5 p.m. HavensightSummit (1,950) 8 a.m. to 5 p.m. Havensight

Tuesday, May 1Carnival Liberty (2,974) 10 a.m. to 6 p.m. Havensight

Wednesday, May 2Constellation (1,950) 8 a.m. to 5 p.m. HavensightAllure of the Seas (5,400) 9 a.m. to 5 p.m. Crown Bay

Thursday, May 3Carnival Valor (2,974) 7 a.m. to 5 p.m. Havensight

Friday-Sunday, May 4-6No ships

Monday, May 7Carnival Victory (2,758) 7 a.m. to 5 p.m. Havensight

Tuesday, May 8Carnival Dream (3,646) 10 a.m. to 8 p.m. HavensightOasis of the Seas (5,400) 9 a.m. to 6 p.m. Crown Bay


The rural Colorado road leading to the corporate headquarters of Jilapuhn Inc., the parent company of Her Majesty’sCredit Union.

in Denver, is an office complex occupied by anumber of businesses — none of which are HerMajesty’s Credit Union or Jilapuhn.Those names are not on the building’s directory.When reached by phone, Stan McDuffie told

The Daily News that the Denver location had beenclosed and the corporate offices were now “consol-idated” into a single office.The Daily News reporter located the new office,

but it is not at a metropolitan center. Open fieldssurround a small building alongside a lonely,windswept airstrip optimistically named FrontRange Regional Airport.A truck stop near an Interstate 70 exit, about

three miles from the airport, is one of the few busi-nesses nearby.At the airport, the only trace of HMCU was the

name Jilapuhn on a sign at 37397 Cessna Way.The door was locked, but parked in front of thebuilding was a Jeep with specialty Alpha Phi Alphafraternity Virgin Islands license plates and anAuburn University wheel cover on the spare tire.

A man who identified himself as “Mr.McDuffie” responded to a knock on the door. Hisface matches the police mug shot of StanRoberson-Battle taken after his Georgia arrest in2006.McDuffie said he lived in Colorado full-time. He

declined to answer questions about Her Majesty’sCredit Union. He said the company would issue apress release the next day.It did not.McDuffie later said that on April 6 he would

hold a videotaped conversation in his attorney’soffice in Golden, Colo., in which he promised hewould discuss litigation that the credit union wouldhave filed in federal court by then.“A lot of what I have is going to implicate a lot of

people,” he said. “There is more going on with usthan most of our members understand.”April 6 has come and gone, and to date, the prom-

ised litigation has not materialized. No lawsuitshave been filed by Jilapuhn, Her Majesty’s CreditUnion or Stan McDuffie.— Sean McCoy contributed to this report.

Contact reporter Aldeth Lewin at 340-714-9111 oremail [email protected].





LICENSE TO STEAL

Pick 3 (April 28)

Midday

1st Prize 9 1 5

Sunset

1st Prize 5 9 2

Evening

1st Prize 6 7 2

Doubles (April 28)

Red: 9 14

White: 1 3

Mega Millions(April 28) Next draw: Tuesday

2 5 45 46 47

Mega Ball: 37

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Midday

1st prize 5 1 5 1

Sunset

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All results posted are manually entered and are subject to error.

Validate all results with the local lottery office or a lottery retailer.

Powerball (April 29) Next draw: Wednesday

31 39 40 57 58 Powerball: 33

Caribbean Lottery

Starting and operating a credit union in the V.I.Her Majesty’s Credit Union does

not operate like other creditunions.It does not have insurance.It does not operate under any gov-

ernment regulations.It does not have a member-elected

board of directors.It does not have regular member-

ship meetings.It does not release financial records

to investigators or regulators at thefederal, state and territorial levels.Yet for almost three years, HMCU

has been taking money from VirginIslands residents, with the blessingof the V.I. government.An independent federal agency

that charters and supervises federalcredit unions, the National CreditUnionAdministration operates theNational Credit Union ShareInsurance Fund, which insures thesavings of federal credit union mem-bers. The National Credit UnionShare Insurance Fund for creditunions is the equivalent of the

Federal Deposit InsuranceCorporation for banks. FDIC doesnot insure credit unions.The difference between credit

unions and banks is that creditunions have shares, whereas bankshave deposits.NCUAPublic Affairs Specialist

John Zimmerman said credit unionsoriginated with employee groups asa way to provide financial servicesthat they might not have been able toget from a bank.Credit union membership can be

set by geography, career group, orassociation.Credit unions do not have any

stock, so any profit they make getsreinvested into the credit union.“That results in higher rates on

savings and lower rates on loans,”Zimmerman said.Because credit unions are nonprof-

its, they are tax exempt. The tax sav-ing goes to the credit union members.Credit unions generally are very

well-capitalized, Zimmerman said.

At the end of last year, 7,094 cred-it unions were operating in theUnited States. Of those, 4,447 arefederally chartered and 2,647 arestate chartered.Each credit union is governed by a

volunteer board of directors, electedby the credit union’s members andaccountable for the institution. Board

members decide on fees, interestrates and services the credit unionwill provide.“Credit unions are nonprofits, and

they really spend a lot of time andenergy trying to figure out what’s inthe best interest of their members,”Zimmerman said.Five of the six credit unions in the

Virgin Islands comply with theFederal Credit UnionAct.Her Majesty’s Credit Union does

not.Each state has a credit union law,

“which usually is fairly similar to thefederal act,” Zimmerman said.The Virgin Islands does not.In some states, credit unions are

state chartered and regulated by thestate. “But in the majority of states

— by statute, by state law— thecredit union has to be insured by thefederal government,” Zimmermansaid.In contrast, the Virgin Islands does

not have comprehensive legislationgoverning credit unions. It simplydirects the Department of Licensingand Consumer Affairs to draft rulesand regulations for credit unions.That law was passed in 1971, but todate, no rules and regulations exist.In the states — unlike in the Virgin

Islands— credit unions are notallowed to operate without insurance.Lori Solberg, vice-president of

sales and marketing at AmericanShare Insurance, said that if a creditunion in the states is not insured bythe National Credit UnionAssociation, then it must be insuredbyAmerican Share Insurance.“They can’t be in business. They

have to be insured by one or theother. Without insurance, they can-not operate,” Solberg said.American Share Insurance is a

nonprofit, owned by its credit unionmembers. “We are an insurer only.We are not a regulator,” Solberg said.American Share Insurance cannot

insure a credit union in the VirginIslands because American Share isnot authorized to operate outside theUnited States mainland.When HerMajesty’s Credit Union

Other credit unionsin the Virgin Islands• Christiansted Federal Credit Union

• Frederiksted Federal Credit Union

• Mid-Island Federal Credit Union

• St. Thomas Federal Credit Union

• Vitelco Credit Union

All five of these credit unions are legitimate. They are regulated

and insured by the National Credit Union Administration. All are

nonprofit corporations registered with the V.I. Lt. Governor’s

Office. HMCU is not.


See STARTING, next page



LICENSE TO STEAL

first opened its doors to the public, itclaimed it was privately insured byLloyd’s of London. In a sales letter towhat it termed “future members,”HMCU stated: “Your funds are insuredup to $100,000 per account throughLloyd’s of London.” A similar state-ment was on the HMCUwebsite.In a January 2009 letter from Brit

Syndicates – written on behalf of theunderwriters at Lloyd’s of London —Jilapuhn was told to stop using theLloyd’s name.“First, the use of the Lloyd’s name

is unauthorized and at no time hasanyone at Lloyd’s provided authoriza-tion for such use.”In the letter, Lloyd’s pointed out

that a bankers’ blanket bond, which itinitially provided to Jilapuhn, neverwas intended to provide protection tocredit union depositors.A bankers’blanket bond protects only the finan-cial institution itself, not the individu-al depositors, against loss caused bycriminal acts of bank employees.Lloyd’s canceled that policy on

Sept. 2, 2008, because Jilapuhn failedto make its payments.In November 2009, Lloyd’s once

again ordered Jilapuhn to cease anddesist using the Lloyd’s of Londonname and advertising that Lloyd’s isthe insurer for HMCU’s members.HMCU has ignored that order.

HMCU gave a new depositor an infor-mation form in January 2011— twoyears after the cease-and-desist order— citing its connection to Lloyd’sinsurance with this message:“This institution is privately

insured through Lloyd’s of London,which allows us to insure each ofyour accounts up to $100,000.”


STARTINGCONTINUED FROM PAGE 10

Starting a credit union in accordwith NCUAstandards and proceduresis not easy.A new credit union needs spon-

sors, members and people withfinancial wherewithal willing to putmoney into the credit union for asignificant period of time,Zimmerman said.A board of directors must be

assembled, and a professional or vol-unteer staff must be put in place.“It’s serious business because it’s

backed by the full faith and credit ofthe government,” Zimmerman said.If any officials or senior execu-

tive officers have a criminal recordthat shows up on a backgroundcheck, they must resign,Zimmerman said.“You have to find people, but you

have to find people in good stand-ing,” he said.The steps to becoming a federally

chartered credit union are intense,requiring mountains of paperworkand financial documents and incredi-bly high levels of scrutiny.“It’s a substantial amount of work

to start a credit union or any financialinstitution,” Zimmerman said.In the Virgin Islands, however, it’s

barely any work at all.The only thing the V.I. govern-

ment required for HMCU to start upwas a three-page business licenseapplication. Her Majesty’s CreditUnion filled it out, opened its doorsand was free to start taking in peo-ple’s money.—Contact reporterAldeth Lewin at

714-9111 or email [email protected].

A letter from Lloyd’s of London to Jilapuhn demanding Her Majesty’s CreditUnion stop claiming it is insured by Lloyd’s.


VI_DAILYNEWS/PAGES [A12] | 04/29/12 21:39 | SUPERIMP

LICENSE TO STEAL

The website for Her Majesty’s Credit Union —www.hmcu.net — says a lot without saying

much.It falsely implies a Caribbean affiliation by dis-

playing as its slogan: “Dem People, Dem CreditUnion.”The website carries this statement:“As a credit union in the Caribbean our goal is to

bring back the TRUE meaning of credit union. Thisconcept has been lost by so many credit unions today.At HMCU, we are a true Caribbean credit union withthe values of the Caribbean people. We are not only acredit union, but a Caribbean Family Union!”What it does not reveal is the fact that members’

money is left unprotected.Shares in the HMCU are not insured, but the web-

site suggests otherwise by prominently displaying theFederal Deposit Insurance Corporation emblem onthe home page and quoting an FDIC alert thatHMCU picked up elsewhere and uses on its ownwebsite:“HMCU is issuing a fraud alert to members and

potential members. HMCU does not broker accountopenings with any company or individuals. PLEASEBEAWARE OFADVANCED FEE LOAN

SCAMS!”The website also bears the America’s Credit

Unions logo, which is available for use only by mem-bers of the Credit Union National Association.Her Majesty’s Credit Union is not a member.The HMCU website “About Us” page touts the

credit union’s claim to integrity with this statement:“Trust, openness, honesty, accountability and the

highest ethical standards are important parts of HerMajesty’s Credit Union work ethic, supporting ourtrademarks of integrity and trust.”Her Majesty’s Credit Union invokes the name of

Jesus and quotes scripture, a tactic that might inspiretrust where none should be given.The website states that HMCU’s corporate name,

Jilapuhn, stands for Jesus is Lord all praises unto hisname. The website then displays the following:“No weapon that is formed against thee shall pros-

per; and every tongue that shall rise against thee injudgment thou shalt condemn. This is the heritage ofthe servants of the LORD, and their righteousness isof me, saith the LORD. — Isaiah 54:17.”

—Contact reporterAldeth Lewin at 714-9111 or [email protected].

Many false claims on HMCU websiteA SPECIAL INVESTIGATIVE REPORT BY DAILY NEWS REPORTER ALDETH LEWIN



ONE DOLLAR www.virginislandsdailynews.com

Copyright © 2012 Daily News Publishing Co. WEDNESDAY, MAY 2, 2012 81st year, No. 22378

81

The sweetdelight

of cookiesPage 28

Daily News Photos by THOMAS LAYERDepartment of Licensing and Consumer Affairs office on St Thomas. At top, Her Majesty’s Credit Union office inTutu Park Mall has been closed for weeks. The Attorney General is investigating the credit union.

Page 3

V.I. toprobecreditunion

Obama visitsAfghanistan

Page 16

Popovichis NBA Coach

of the YearPage 48

Educationfinds cashto restoreschool bus

servicePage 3

CAHS vs. KeanBack Page

Good HealthCare Guide

INSIDE


VIRGIN ISLANDS

Education Department says buses will run today

By FIONA STOKES

Daily News Staff

ST. CROIX — School buses areexpected to be back in service on St.Croix today, but officials warned thatthere is a possibility service could bedisrupted again.School bus service was suspended

on the island on Monday because theV.I. Education Department owed thebus company, Abramson EnterprisesInc., more than $625,000.Education officials released a

statement announcing the suspensionMonday but at that time did not knowhow long the service disruptionwould last.On Tuesday afternoon, Education

spokeswoman Ananta Pancham saidthat Education Department officialsexamined all sources of funding andpulled together funds to cover theoutstanding payments for February

and March, which will allow thebuses to run again onWednesday.The department has a contract to

pay the Abramson Enterprises about$4 million annually to provide busservice, and the account had beenpaid in full through the end ofJanuary, Pancham said.While the payments have been

made, officials made it clearTuesday that this is just a short-termfix to a problem that will resurfaceif a consistent revenue source is notfound.Pancham said checks delivered to

the company Tuesday were coveredby funds pulled from other essentialareas — such as janitorial and secu-rity guard services — that thedepartment now may not be able tomaintain.Education officials will continue

to work with the V.I. Office ofManagement and Budget to address

the shortfall and to pay future trans-portation bills, which officials saidcannot be covered by the depart-ment’s already strained General Fundbudget, according to Pancham.The Education Department was

notified two weeks ago byAbramsonEnterprises that it was behind on itspayments to provide school bus servicein the district, leaving open the possi-bility of a suspension of service,according to Pancham.A spokesman for Abramson

Enterprises did not respond to DailyNews calls Monday or Tuesday.When classes resumed Monday

morning after the V.I. Carnival break,students on St. Croix waiting forschool buses were left stranded.The lack of any notice from the

Education Department angered manyparents whose children were leftstanding at the bus stop.St. Croix School Superintendant

Gary Molloy said Tuesday that he isaware of the disruption that the sus-pension of the bus service caused inthe district for students and their par-

ents and regrets the inconvenience itcaused.Attendance also suffered, primari-

ly on Monday and a little on Tuesday,because some parents had no alter-nate means to get their children toschool, he said.Molloy said the department was

not completely caught off-guard bythe disruption of service, but the ser-vice suspension still was somethingEducation officials did not expect onMonday.“We had some inkling that they

could pull the buses, but not thissoon” he said. “I guess based on howwe were processing the checks andtheir expectation, it was not met.”Education Commissioner LaVerne

Terry said the department’s resourceswill continue to be affected if theyare not able to get the bus situationunder control.“We want to assure the public that

we will continue to work with theOffice of Management and Budget toaddress the funding we need to ensurethat the bills for upcoming months

will be paid,” she said in a preparedstatement issued Tuesday afternoon.On Monday, Sen. Janette Millin

Young, chairwoman of the Senate’sEducation, Youth and CultureCommittee, blasted the EducationDepartment, saying it initially hadincluded $5.7 million in funding forschool bus transportation in an appro-priations request, but the departmenteliminated that item before therequest was submitted to theLegislature.Had the department made its actu-

al needs known, the Senate couldhave identified and moved funds toaddress the bus issue, Millin Youngsaid.In response to those comments,

Pancham said that on many occa-sions, the Education Department hasshared its concerns about the reduc-tions to its budget and the impact thatit would have on mandatory services,including transportation.— Contact reporter Fiona Stokes

a t 7 1 4 - 9 1 4 9 o r e m a i [email protected].

Money earmarked to pay janitors, guardsreallocated to pay $625,000 bus debt

V.I. Justice Department reacts to Daily News investigationby launching probe of Her Majesty’s Credit UnionBy ALDETH LEWIN

Daily News Staff

ST. THOMAS — V.I. JusticeDepartment has launched an investi-gation into Her Majesty’s CreditUnion, and the V.I. Department ofLicensing and Consumer Affairs isasking credit union members who areunable to access their money to file aformal complaint.Both government actions are the

result of a two-month investigativereport by The Daily News found thatHer Majesty’s Credit Union is operat-ed by a man with a criminal record,multiple aliases and a history of failedbusiness ventures. He currently isunder investigation by the U.S.Securities and Exchange Commissionand has been jailed in the past forrefusing to cooperate with state inves-tigators in Colorado looking into pos-sible fraud.The credit union, which is unin-

sured and largely unregulated by theV.I. government, abruptly closed itsdoors to the public in February.Members have had no recourse toobtain their money, and despite prom-ises by the credit union’s ChiefExecutive Officer Stan McDuffie tosend checks, none have beenreceived.Under the V.I. Code, credit unions

not federally chartered and federallyinsured are governed by the DLCA.Her Majesty’s Credit Union is theonly one of six credit unions in theterritory that is not regulated by the

federal government.Her Majesty’s Credit Union is a

subsidiary of a company calledJilapuhn, which is run by McDuffie— who also uses the aliases StanRoberson, Stan Roberson-Battle andStanley Battle. Jilapuhn is registeredas a corporation with the Lt.Governor’s Division of Corporationsand Trademarks, but it is not in goodstanding.Jilapuhn filed for a business license

with DLCA in 2005 and in 2008received a DLCA license to operate acredit union in the territory. Under thename Her Majesty’s Credit Union, itopened in a storefront inside the TutuPark Mall on St. Thomas in 2009.In January, the credit union’s sys-

tem went down — according to theHMCU employees — and while thecredit union continued to acceptdeposits, it refused to allow membersto make withdrawals.In February, Her Majesty’s Credit

Union shut down with no notice tomembers.DLCACommissionerWayne Biggs

Jr. sent out a public statement Tuesdayurging any member of the credit unionwho has had difficulty gaining accessto accounts or has been unable tomake withdrawal of their deposits tocontact DLCA to file a formal com-plaint.“Individuals facing the unfortunate

dilemma of not having access to theiraccounts can come to the Departmentand meet with a Consumer ProtectionServices agent who will assist them in

completing the required paperwork,”the release said.The process includes some paper-

work and an interviewwith a consum-er protection services agent, Biggssaid.Biggs said the DLCA is now inves-

tigating the credit union, which couldlead to the revocation of HMCU’sbusiness license.“We’re doing our investigation, and

then we will determine what shouldhappen after that,” he told The DailyNews on Tuesday.The Daily News investigation also

spurred the V.I. Justice Department toopen an investigation into HerMajesty’s Credit Union.

“We did start an investigation uponyour call,” V.I. Attorney GeneralVincent Frazer said.When The Daily News contacted

Frazer last month, he said he had notheard about the credit union and saidhe would ask his staff to look into thematter.He said his investigation is very

broad and simply is looking into whathappened. Frazer said some victimshave been identified, although hewould not disclose how many.“That would be a critical part of the

investigation,” he said.When asked if the Just ice

Department plans to file chargesagainst the credit union or its princi-

pals, Frazer said it is too soon to tell.“We have to conclude the investi-

gation to know what we can do,” hesaid.Questions about the complaint pro-

cess can be directed to the Departmentof Licensing and Consumer Affairs,Division of Consumer Services, at774-3130.DLCA’s St. Thomas office is in

Sub Base on the second floor of theProperty and Procurement Building.— Contact reporter Aldeth Lewin

a t 7 1 4 - 9 1 1 1 o r e m a i [email protected].

To file acomplaint

Members of Her Majesty’sCredit Union who have hadtrouble accessing their moneycan file a formal complaintwith the V.I. Department ofLicensing and ConsumerAffairs. Go to the DLCA’s St.Thomas office in Sub Baseand ask to speak to a consum-er protection services agent.

DLCA’s St. Thomas officeis in Sub Base on the sec-ond floor of the Property andProcurement Building, nearthe public tennis courts.

For more information call774-3130.

Daily News Photo by THOMAS LAYER

Her Majesty’s Credit Union’s branch in Tutu Park Mall remains closed. Themall is suing the credit union for failing to pay rent.

Wednesday, May 2, 2012 The Virgin Islands Daily News 3

VIDN_LicenseToSteal

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