Mississippi credit union liquidated after $103 million loss.
Jackson Area Federal Credit Union was declared insolvent after months in conservatorship as a separate criminal case against its former chief executive moved forward.
The National Credit Union Administration has liquidated Jackson Area Federal Credit Union after determining the $60 million institution was insolvent and had operated in an unsafe and unsound manner, ending months of federal oversight and transferring its remaining members to Five Star Credit Union.
Under a partial purchase and assumption completed Wednesday, Five Star, based in Dothan, Ala., acquired some of Jackson Area’s assets and assumed its share accounts. Jackson Area Federal Credit Union was then liquidated.
Members transferring to Five Star will see no interruption in service, the NCUA said. Their accounts remain insured by the National Credit Union Share Insurance Fund, which provides coverage of up to $250,000 for individual accounts, with separate rules for joint and retirement accounts.
The liquidation follows a difficult year for Jackson Area Federal Credit Union. The credit union served 15,704 members and had approximately $60 million in assets, according to its most recent call report. It lost more than $103 million in the first six months of 2026, according to the information provided.
The credit union had been under federal conservatorship since May 6, when the NCUA appointed itself conservator and began efforts to stabilize the institution and address problems affecting its safety and soundness.
After several months of analysis and discussions with stakeholders, the agency concluded that the credit union had no prospect of restoring viable operations. The NCUA said Jackson Area was insolvent and had violated numerous provisions of the Federal Credit Union Act and NCUA rules and regulations.
Jackson Area, chartered in 1953, served employees of the City of Jackson and employees as well as elected and appointed officials of Hinds County. Its membership field included 38 distinct groups, primarily made up of local government employees.
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The liquidation came two days after former Jackson Area President and CEO Leigh Bridges pleaded guilty to three federal charges in a criminal case involving what prosecutors described in court as a more than $69 million embezzlement scheme that left the credit union insolvent.
Bridges pleaded guilty to theft from a federal credit union, making false statements involving a federal credit union and filing a false tax return.
The criminal case is separate from a civil action brought by the NCUA against Bridges, her husband, Chad Bridges, and former branch manager Tina Funez. The agency’s civil case alleges losses of approximately $95 million.
The NCUA did not provide further details in the material supplied about how the alleged conduct contributed to the credit union’s losses beyond the determination that the institution was insolvent and had no viable path to recovery.
For Five Star Credit Union, the transaction adds members and accounts as the Alabama institution continues operating at a considerably larger scale than Jackson Area. Five Star has 68,823 members and $1.3 billion in assets, according to its most recent call report.
Five Star earned $6.8 million in the first six months of 2026, compared with $5.1 million in the same period a year earlier.
The purchase and assumption structure allows the NCUA to move Jackson Area members and accounts into another federally insured institution rather than continue operating the failed credit union.
The case also illustrates the consequences that can follow when an institution is unable to restore its financial condition after coming under federal supervision. In Jackson, that process has now ended with liquidation and a transfer of members rather than a return to independent operation.
Ken McCarthy is manager of marketing communications at Tyfone, where he monitors the credit union industry and contributes to conversations shaping its future. He previously covered credit unions and community banking for American Banker and S&P Global Market Intelligence. He holds a journalism degree from Point Park University and has more than 15 years of experience covering financial services. He is also the author of three literary fiction novels.
