American Share sues over bond claim [Las Vegas Business Press]

American Share Insurance, a private deposit insurer, has filed a lawsuit in federal court in Las Vegas claiming CUMIS Insurance Society Inc. is bound by a $685,000 bond claim for the failure of Cumorah Credit Union.

The lawsuit, removed from state to federal court last month, claims the CUMIS bond for the credit union should cover losses associated with unauthorized business loans approved by Kim Taufer, Cumorah's former chief operating officer and chief loan officer.

Under the credit union's lending policies, Taufer was required to have the loans approved by the board of directors, the lawsuit said. ASI said Taufer "acted without authority and breach of his trust."

In June 2004, Cumorah approved MVM Leasing LLC's request for a $1.5 million business line of credit. According to the agreement, Cumorah would buy vehicle contracts from MVH and MVM would pay the credit union back for any contracts deemed in default.

"Despite the fact that MVM's line of credit was only authorized up to $1.5 million, Mr. Taufer authorized loans to MVM up to $2.5 million without authorization and in violation of Cumorah's lending policies," ASI's lawsuit said.

Taufer stopped issuing new leases in 2006, but two years later resumed approving "the purchase of new leases from MVM without authorization from the CEO or board of directors."

ASI's lawsuit also claims Taufer "made false entries in the books and records ... in an attempt to cover up his prior wrongful conduct."

Nevada regulators seized Cumorah on Oct. 23, 2009, and American Share Insurance was appointed as its receiver. The credit union, which served 15,000 members of the Church of Jesus Christ of Latter-day Saints, had two offices in Las Vegas and two in Henderson.