TAMPA, Fla.— GTE Financial Credit Union said it has filed a claim with the American Arbitration Association demanding that Velera Credit Union Services repay nearly $4 million in patron equity owed to GTE.
“Despite repeated attempts since 2020 to resolve the matter through good-faith negotiations, Velera has consistently refused to engage in meaningful discussions regarding the timely repayment of funds,” the $2.9 billion credit union said. “At Velera’s current rate of repayment, it would take nearly seven centuries—669 years—for GTE to recover its equity in full.”
According to GTE Financial, in 1977 it was among the founding members of Payment Services for Credit Unions (PSCU), which eventually became Velera following a merger with Co-op Solutions.
‘All the More Disappointing’
“GTE has always valued collaboration within the credit union industry, which makes Velera’s refusal to honor its financial obligation all the more disappointing,” said Marie Campbell, vice president and general counsel of GTE Financial, in a statement. “Our members’ equity is not optional, and the deliberate delay in repayment is an affront to the cooperative values on which credit unions are built. We are simply asking Velera to do what is right and return what is owed.”
GTE Financial noted that Velera is one of the largest CUSOs in the country, reporting 2024 revenue of $1.4 billion and assets totaling $2.7 billion, “further underscoring its ability to make timely repayment.”
A Broader Issue
“This situation reflects a broader issue of trust within industry partnerships, and it is vital that we restore accountability and good-faith dealings,” GTE Financial President and CEO Brian Best said in a statement. “Credit unions and CUSOs alike must remain committed to their foundational values rather than allowing disputes to undermine the cooperative framework.”
GTE Financial said it remained a patron member of Velera for more than four decades before disassociating in July 2019, when the credit union began managing its payment processing in-house. At that time, GTE said, Velera owed $4,799,805 in patron equity.
“While Velera has made token annual payments since then, its pace of repayment deprives GTE of millions in potential opportunity earnings, particularly given that no interest is accruing on the outstanding balance,” the credit union stated.
‘Fairness & Integrity’
Added Campbell in a statement, “This is about fairness, integrity and accountability. Our responsibility is to protect the financial interests of our members, and that means ensuring that Velera fulfills its obligation. We will pursue every avenue necessary to recover the funds that rightfully belong to our credit union and its members.”
In response to a query from the CU Daily, Velera said it does not comment on pending disputes, per company policy.
