SAN ANTONIO A former vice president and chief loan officer at Southside CU on Tuesday pleaded guilty to falsifying the institution’s books to hide non-payments on a local car dealer’s $1.4 million line of credit with the credit union.
Royce Stockton agreed to plead guilty to a single felony count.
Stockton admitted to falsifying the books to hide the fact the line of credit exceeded the regulatory limit on loans. During 2008, the credit union provided the car dealer with a floor plan line of credit to finance vehicles and Stockton allowed the business immediate credit for drafts issued for vehicle sales. In early 2011, more than $400,000 of the drafts were returned to the $23-million credit union unpaid.
Stockton admitted to cooking the books to hide the deficit.
Stockton never reported the issues, and instead tried to “get it collected,” according to his plea agreement. He was terminated in September 2011 for withholding information from Southside’s board, the document added.
It was later discovered that numerous vehicles purportedly collateralizing the dealer’s line of credit were missing, the plea agreement states.
In a separate case, the credit union’s CEO, Kenneth Baker, agreed to plead guilty to embezzling more than $39,000, some of which he diverted to an investment brokerage account.