Less than six weeks after it was declared insolvent and orderedby state regulators to suspend its operations, the loans, depositsand other assets of the $14 million Bensenville Community Credit Union in Illinois were purchasedby the $756 million Credit Union 1 in Rantoul, Ill., on July31.

In the news release posted on its site late Thursday, AmericanShare Insurance said it was appointed the liquidating agent ofBensenville Community CU when the Illinois Division of FinancialInstitution ordered the credit union to be closed on July 31.

The former credit union chartered in 1934 now operates as CreditUnion 1.

When the Illinois Division of Financial Institutions issued asuspension of operations order June 16, it also appointed CreditUnion 1 President/CEO Paul Simons the manager/trustee of Bensenville Community CU allowing it to remain operating untilmerger partner could be found.

In addition, James McNeil, an internal auditor for Credit Union1, was named interim manager of Bensenville Community CU inFebruary after the resignation of Roger Peters, formerpresident/CEO of the Bensenville Community CU. Following Peters'departure, two other credit union employees also resigned, McNeilsaid.

Simons, a former ASI board member, said Credit Union 1 wasapproached by state regulators to manage the credit union until itcould find a suitable merger partner.

Though Bensenville Community's sole branch is expected to remainopen through the fall, it will eventually be closed because CreditUnion 1 operates a branch about five miles away in North Lake,Simons said.

Bensenville Community's six credit union employees will have“every opportunity” to apply for jobs for which they are qualifiedat Credit Union 1, he said.

Simons said he was named as Bensenville Community'smanager/trustee because Credit Union 1 worked with state regulatorsover the years with different problem cases that they have had.

“Typically, we always do mergers, but in this case, the creditunion actually was liquidated and then it became a purchase andassumption,” Simons said. “We purchased substantially all of theassets and substantially all of the liabilities.”

Simons said at least five other credit unions were invited byASI to conduct due diligence and consider bidding for the purchaseand assumption of Bensenville Community.

“When any credit union came into the office to do their duediligence, McNeill removed himself because we wanted to make surethere was no hint that we had any kind of insider knowledge,”Simons said. “He left the other credit unions that werereviewing and doing their due diligence to talk with his assistant,talk to the staff,” he said. “He left himself out of it.”

Simons also said McNeill was not involved in Credit Union 1'sdue diligence process.

McNeil said the members are receiving a notice of the purchaseas soon as it can be mailed to them.

However, members were informed at the credit union's annualmeeting May that it was seeking a merger partner.