6th Circ. Backs $8M Michigan First Win Over Loan Losses

Law360, New York (May 24, 2011, 5:30 PM EDT) -- The Sixth Circuit on Tuesday upheld a $7.7 million award to Michigan First Credit Union in a suit seeking coverage from Cumis Insurance Society Inc. for substantial losses caused by Michigan First employees who blatantly disregarded loan approval policies.

Michigan First filed the suit in Michigan after discovering that its vice president of lending failed to monitor its indirect loan program, which allowed applicants to apply for loans at car dealerships. Under the program, a third-party administrator approved low-risk loans, but riskier applications were sent to...
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