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Credit union and its former top executive trade charges in lawsuit

New Hampshire Union Leader

August 16. 2017 12:28AM
GORDON SIMMONS ... sues credit union over 2016 ouster 

Sex, lies and CEO compensation.

They’re all contained in a lurid lawsuit that pits a former credit union chief-executive against Service Credit Union, the organization he led for 21 years.

After being sued by its former CEO, the Portsmouth-based credit union says that Gordon Simmons was forced to resign in January 2016 after he admitted to a sexual relationship with his administrative assistant. The credit union claims Simmons initially lied when confronted about the relationship, but he eventually admitted to the affair, to taking her on a business trip and to secretly paying her $38,000 in relocation expenses.

The credit union says it now faces two legal claims growing out of the affair. One is from the administrative assistant. The other is from an employee who was fired after she questioned the existence of the relationship.

“Mr. Simmons’ actions, manipulations, and misrepresentations in personnel matters, financial matters, and the management of SCU were in violation of his obligations and responsibilities as CEO and as a board member,” the credit union says in filings.

Simmons initially brought the suit in Rockingham County Superior Court, but it has since moved to U.S. District Court.

In his initial lawsuit, Simmons makes no mention of an affair. In subsequent pleadings, he admits to the relationship, but denies that he started it.

“Mr. Simmons was the target of an SCU employee’s intentional efforts to manipulate him,” his lawyer writes.

After resigning, Simmons sued his former employer in March, claiming Service Credit Union reneged on a provision in his employment contract to cover health care costs for him and his wife once he left his job.

The Simmons suit said he has spent $39,540 so far in medical costs, and the amount will only grow.

Simmons earned $1.8 million in salary, bonuses, retirement and other compensation according to 2015 tax filings. The credit union had also provided him with a house in Portsmouth, according to the lawsuit.

Simmons now lives in Riegelsberg, Germany, according to his lawsuit, which names Sieglinde Simmons as a co-plaintiff. The lawsuit does not identify them as husband and wife, but they share the same address in Riegelsberg.

According to his filings, Simmons had worked at Service Credit Union for 41 years. During his term as president and chief executive, Service Credit Union grew from $282 million in assets to $2.79 billion, according to the suit.

Service Credit Union, which opened in 1957 to serve military personnel assigned to the Air Force base in Portsmouth, now counts 240,000 people as its members, according to its website. It has locations in New Hampshire, Massachusetts, North Dakota and Germany.

In his filings, Simmons said he met with directors in an emergency meeting on Jan. 27, 2016. He asked to resign so he could retire. The chairman accepted his request, and he embraced or shook hands with all members, the suit said.

But in its filings, the credit union claims that directors met Simmons on Jan. 19 to discuss “allegations of financial misconduct, a sexual relationship with a direct subordinate, and other violations of SCU policies.”

If they were true, the board warned, he would be fired.

“Mr. Simmons replied that he was ’shocked’ at the allegations. He expressed outrage that he would be questioned after his lengthy employment with SCU,” the suit reads. He admitted to the relationship, but said it started after the woman had left the organization.

Eight days later, he requested the emergency board meeting, admitted to a relationship during the woman’s employment, as well as the business trip and remuneration for her relocation expenses.

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