Unsafe investments lead to conservatorship for Saguaro

Ian Mayer Arizona Daily Wildcat Many students headed for the Saguaro Credit Union in the basement of the Memorial Student Union yesterday to make deposits in their accounts after returning from winter break. The National Credit Union Administration put Saguaro in conservatorship Dec. 18 after the federal agency and the Arizona Banking Department determined the credit union was not safely investing its money.

The National Credit Union Administration put Saguaro in conservatorship Dec. 18 after the federal agency and the Arizona Banking Department determined that the credit union was not safely investing its money.

"A question arose about some of the investments made by the credit union itself," said Richard Houseworth, superintendent of banks at the Arizona State Banking Department. "The investments were not worth what they were carrying them on the books at."

Houseworth said he could not reveal what the questionable investments were.

During conservatorship, the NCUA oversees the daily and investment operations of the credit union. Everett Swearengin was installed as president of Saguaro, a credit union which has 30,000 members - most of whom are employees, students or alumni of the University of Arizona and Pima Community College.

Lesia Bullock, spokeswomen for the NCUA, said conservatorship should not be considered dangerous or risky for the credit union members.

"This credit union is healthy, it is business as usual," Bullock said. "The staff, faculty and students can continue to carry on their daily banking issues. Office hours have not been changed and services have not been changed."

Although services did not change, Houseworth did realize announcements about conservatorship could make members nervous. Before the news was released, he contacted UA President Peter Likins about the changes.

"It was a courtesy call from him to me to reassure there was no vulnerability," Likins said. "There was no risk to the members."

Houseworth reiterated his feelings Monday.

"In my view, placing Saguaro Credit Union in conservatorship was the very best thing for the credit union and the best way the credit union could be returned to the membership," Houseworth said. "It will be stronger after."

Houseworth said the covservatorship did not have a definite timeline.

Jean Johnson, UA assistant controller, said the university was not planning to make any changes to the CatCard program. The CatCard can be used as an ATM card for Saguaro Credit Union accounts.