Washington Postal EFCU’s ‘Fight With The Fed’

By Bill Merrick

Nearly two-and-a-half years after an anthrax attack closed Washington (D.C.) Postal Employees Federal Credit Union’s sole office, the $20 million asset credit union returned to its home in the U.S. Postal Service’s Brentwood facility.

Twists and turns abounded during the credit union’s lengthy “adventure,” CEO Patricia Yates notes (Credit Union Magazine, 5/04, p. 28). And the last thing she wanted to do following the ordeal was to wrangle with a government agency about money. But there was a little matter of newly irradiated $250,000 in the credit union’s safe to consider.

The U.S. Postal Service irradiated the safe’s contents, as it did with everything else in the facility, as a precautionary measure. But the Federal Reserve wouldn’t accept the money for disposal, as it does for funds contaminated by a variety of substances. So the $250,000 sat unusable.

“I call this my fight with the Fed,” Yates says.

Fortunately for Washington Postal Employees Federal, the Washington Post covered the story, and area papers picked it up. Once that happened, the Fed changed its position and agreed to accept the cash—under certain conditions.

“We had to have the cash transported in an armored car that didn’t contain any other cash,” Yates explains. “And it had to be packaged a certain way. But first and foremost, it had to be counted. After being irradiated, the cash was thrown loose in a box. It was slightly discolored and the texture was different.”

Some staff members were concerned the money still might be contaminated, so Yates asked for a volunteer to help count it. Her loan manager answered the call, and the two of them counted the money by hand under police guard. They sent the money to the Fed under the special conditions, and the agency credited Washington Postal Employees Federal’s account.

“I wonder if they actually counted it. They probably took our word for it,” Yates jokes. “But the issue was resolved.”

The Postal Service disposed of the credit union’s coins by dumping them in a liquid that corrodes the metal and makes them unrecognizable.

“I appreciate the effort of the D.C. League as it tried to communicate with the Fed and help us handle this situation,” Yates says. “If you can imagine, early on we had people tell us, ‘Open your vault and take out the cash. And we won’t sign anything that says we’re responsible for it.’ I had no choice but to surrender my keys and combinations so the Postal Service inspection officers could enter the building and remove the cash and coins.”