Last month, Powers had to explain to Buescher how in the course of 10 years she took out $615,000 in loans from her employer using first the names of family members, then the names of friends and finally the names of strangers.
Janesville police on Friday arrested Powers, 50, of 3424 Kingsbridge Drive, Janesville, on charges of embezzlement and 12 counts of felony misappropriation of identification.
Powers’ attorney estimates she took out $615,000 in loans in other people’s names, and the credit union has lost $712,247 because of Powers, according to police documents.
Powers was a loan manager at PCCU where she worked for more than 20 years, said Interim Chief Executive Officer Christine Dawe. Powers had been in a position to hire people since 1987, she told the Gazette in an unrelated 2008 interview.
Dawe, who has worked at PCCU since April 4, said the credit union has strengthened its internal controls and is safe and strong. The credit union is federally insured, she said.
A letter mailed Friday to customers and posted on the credit union’s website says the same.
None of the people whose identities Powers is accused of using will be out any money, Dawe said.
Dawe said she put Powers on administrative leave April 12 and fired her a week later.
No other employees lost their jobs as a result of the investigation, Dawe said. Former credit union President Jerry Bohne was let go in March, although that was not related to the Powers investigation, Dawe said.
“There is no indication that anyone else was involved,” Dawe said.
The credit union's board of directors hired Dawe to investigate suspicious activity, according to police reports. She is a consultant who specializes in working as an interim credit union officer.
Here’s what happened, according to Janesville Police Department documents and a phone interview with Dawe:
On April 20, Dawe contacted Janesville police about a questionable $10,000 signature loan.
The loan was taken out in the name of a PCCU customer whose credit history qualified her to apply for loans by phone. A loan officer took the call and brought the paperwork to Powers for approval.
The loan officer questioned if the loan would go through, but Powers approved it.
The teller then called the customer to tell her the loan was approved. During police questioning, however, she could not remember if she looked up the customer’s phone number or called the number from her caller ID.
Either way, the customer did not get loan documents in the mail at her winter home in Florida and said she was not aware of the loan until she got back to Janesville in April. At that time, she reported the problem to Dawe.
Four installments of $2,500 were drawn against the loan in January; payments of $350 were made in February and March.
Those payments led police and credit union officials to suspect the bad loan was an inside job.
Powers had at least $700,000 in loans in her own name from Parker Community Credit Union. Her monthly payments were between $10,000 and $15,000. Her annual salary was $40,000.
Powers told police that she took out at least 18 loans in other people’s names. Those loans ranged from $2,000 to $150,000. She bought vehicles, a boat, ATVs, property and jewelry, among other things.
Eventually, she used the name of a family friend who relied on her to manage his credit union accounts.
The friend became aware in 2009 that Powers had taken out a loan in his name. In March of this year, he learned Powers made withdrawals from his savings account to make payments on the loan.
Eventually, she began using the names of strangers.
One customer called Powers when he became aware of a loan in his name. She told him it was an internal error and would be corrected.
One person apparently paid the balance of a $10,000 loan Powers took out in his name.
Powers used the drive-through cash dispensing machine inside the credit union to make cash withdrawals. She saved the money in her office until she needed to make loan payments.
She accessed tellers’ stations to make cash payments or made employees do so for her. She instructed a former collections employee not to make calls to some people about past-due loans.
The employee told police she did what she was told for fear of losing her job if she didn’t.
Powers told police she did not stash any cash or wire any money to other accounts.
According to online court records, the Rock County district attorney has not charged Powers, and her initial court appearance has not been set.