CEO Delivered a Confession: When Theft Puts on a Cooperative Mask

By Ed Speed

The anonymous credit union leader who wrote the recent defense of merger practices in the CU Daily probably imagined he was offering nuance. Instead, he delivered a confession. Not the quiet kind whispered behind closed doors, but a loud, revealing admission of how far the movement has wandered from its purpose.

Let’s start with the sentence that explodes the whole argument:

“They are written that way for the NCUA, not members.”

This isn’t a minor footnote about compliance. It is the very definition of betrayal. If the people who own the institution are no longer the primary audience; if their understanding, their consent, and their trust are secondary to pleasing regulators and consultants, then the cooperative identity has already been murdered. What remains is performance: the legal shell of a member-owned institution animated by self-serving internal logic.

‘Astonishing Claim’

And then comes the astonishing claim that “90%+” of credit unions supposedly give members deeper explanations “if they care.” This is fiction dressed up as insight. Most merger notices are deliberately thin, deliberately vague, and strategically timed to minimize member engagement. Low member response is not evidence of informed consent. It is evidence of a process designed to keep owners uninformed until the deal is irreversible.   Low member response means you have already made yourself so irrelevant, the members don’t give a damn. 

Let’s Call the Payouts What They Are

The writer’s “spectacular ROI” argument, $5 in, $405 out, would be impressive if it had anything to do with the issue at hand. But it doesn’t. The debate is not about whether credit unions once served their members well. Many did. The debate is about what happens at the moment the cooperative is being sold off, buried, absorbed and looted.

And here is the truth no one wants to say plainly: These executive payouts are nothing less than regulatory-sanctioned theft of a community’s retained earnings and legacy capital.

Retained earnings do not belong to executives. They do not belong to consultants nor the NCUA. They do not belong to acquiring institutions. They belong to the members, past, present, and future, whose deposits, trust, and loyalty built that surplus over decades. ‘Theft in a Suit & Tie’

When executives engineer compensation packages triggered by the shutdown of the institution itself, they are converting member capital into personal benefit. The regulator signs off. The consultants write the script. And members watch their inheritance vanish with no vote, no voice, and no real explanation.

Call it what it is. It is theft in a suit and tie. But now it’s blessed by process, paperwork, and professional consultants. It is theft that pretends to be “fiduciary responsibility.”

The “Employee-Owned” Myth Is the Latest Sleight of Hand

The author goes a step further by claiming credit unions are “as much of an employee-owned business as anything else,” because staff are members and “invest more time and effort” than any other member.

This is a clever rhetorical trick, and a dangerous one.

Cooperatives are not ESOPs. 

Employees are not a privileged ownership class. Membership is not determined by emotional investment, number of overtime hours, or who sits in the executive suite. A cooperative belongs to the people whose deposits, transactions, and savings created the retained earnings that executives now plunder on the way out the door.

If we accept the “employee-owned” framing, then members become ornamental. They exist for messaging, not governance. They become props in a narrative designed to justify insider enrichment.

“Where’s the Reward?” — You Already Knew the Deal

The most revealing, and frankly the most disgustingly self-serving, portion of the letter is the lament:

“Why are CU executives expected to do their job for an OK salary, a thank you, and the greater good? They could have made more in a bank.”  

Of course they could have made more in a bank. Everyone knows that. That’s why banks exist. The cooperative model has always offered a different trade: a meaningful vocation, a community mission, a sense of purpose, and the sacred privilege of stewarding the financial well-being of ordinary people.   

You cannot ride the cooperative halo for a career, enjoying tax treatment, community standing, regulatory status, and moral prestige and then, at the end, demand the upside of a publicly traded corporation.

If you want stock options, go to a bank. If you want a golden parachute, go to a bank.
If you want Wall Street’s reward structure, go live on Wall Street. Sure, sparky, go see if you can compete without a taxpayer subsidy. 

But do not arrogantly pretend that cooperative leadership is some kind of involuntary vow of poverty, and that only a merger-triggered payout can make a lifelong sacrifice worthwhile. That’s not humility; it’s greedy entitlement.

The Small CU Story — A Convenient Alibi

The final anecdote—about a struggling SEG, a dedicated CEO who never received a raise, and a merger that “saved the only financial institution for 45 miles” may be true. Yet it is wielded as a moral cover for a practice that extends far beyond struggling rural institutions.

Let’s be honest: Execs at these failing merged CUs rarely receive modest “fairness adjustments.”  Now they want  windfalls that would get bank CEOs crucified in the press if they tried to extract them from shareholders while shutting the doors.

Saving a branch is not the same as preserving a cooperative. Keeping an ATM alive is not the same as protecting ownership. A community losing its credit union, its charter, its governance, and its local control has suffered a loss; not achieved a triumph.

When compensation rides the coattails of closure, something is deeply wrong.

And Here Is the Real Indictment

In the end, the deepest wound is not the money. The deepest wound is what these practices reveal about the soul of the movement.

Because when executives privately extract payouts from the accumulated capital of generations, capital built by factory workers, schoolteachers, refinery workers, nurses, parishioners, and small-town savers, they are not just taking dollars.

They are looting a community’s inheritance.
They are burning the furniture to warm the boardroom.
They are treating 50 years of member sacrifice as a closing-day perk.

And the only reason they get away with it is because the regulator signs the form, the consultant writes the script, and the members, the actual owners are kept quiet, late, uninformed, and irrelevant.

What This Really Is

This isn’t complexity. This isn’t nuance. This is regulatory-sanctioned theft of a community’s legacy capital, carried out under the banner of “progress” and wrapped in consultant-written boilerplate.

If the movement continues down this path, it will not be disrupted by banks, fintechs, or competitive pressures. It will be hollowed out from within: not by its enemies, but by its own shepherds.

Cooperatives can survive mistakes, mismanagement, even the occasional merger.  But no cooperative can survive leaders, like anonymous.  who begin to believe the members’ assets exist for their benefit.

CU Daily Already Dug Deeper. That’s the Problem.

The author ends with a plea for CU Daily to “dig a little deeper” and present a “more holistic view.” But CU Daily has already done the thing he fears most: it has held up a mirror to the incentives, the payouts, and the boilerplate narratives that insiders would prefer remain in the fine print.

What he calls “one perspective” is the missing perspective: the member’s perspective.

We do not need more anonymous essays explaining why executives deserve one last bite at the apple on the way out the door. We need leaders willing to say, out loud, that cooperatives exist to protect the financial dignity of ordinary people, and that anything which undermines that purpose, however “spectacular” the ROI once was, is a betrayal of the charter.

The credit union movement will not die because a few small institutions had to merge–it will die because too many people in positions of trust came to believe that their personal sacrifice was intolerable, while asking silent member-owners to sacrifice their institutions without a word.

That is the deeper story. CU Daily is right to keep telling it.

Sincerely,

The Never Anonymous   Edward Speed

Edward Speed is the retired CEO of a multi-billion-dollar credit union and holds a master’s degree in theology. These days, he spends his time serving food, washing dishes, and sweeping floors at a Catholic Worker House, helping homeless senior citizens. [email protected]