A federal jury in U.S. District Court in Cleveland convicted a 41-year-old Ohio man Wednesday in the $70 million fraud case that led to the collapse of the St. Paul Croatian Federal Credit Union in Eastlake, Ohio.
After a seven-day trial, Svetislav Vujovic was found guilty on10 counts of making false statements to a federal credit union, two counts of money laundering and one count each of financial institution fraud and giving gifts for procuring loans.
Federal prosecutors said Vujovic fraudulently obtained dozens of business and personal loans totaling more than $3 million over four years.
Vujovic will be sentenced in August, according to court documents.
The Brunswick, Ohio, man applied for loans by making false statements and representations. What's more, Vujovic received many of these loans even after he defaulted on previous loans issued to him by the credit union, according to court documents.
Prosecutors also showed that Vujovic gave $20,000 in cash payments to Anthony Raguz, the former CEO/president of SPCFCU, to approve the loans. Raguz was sentenced to 14 years in federal prison in November 2012 for his central role in the massive fraud scheme.
Raguz admitted to approving more than 1,000 fraudulent loans totaling $70 million to over 300 account holders at the cooperative from 2000 to 2010. He also accepted bribes totaling $1 million to approve loans, according to the original indictment.
About 20 people have been indicted for their role in SPCFCU's collapse, according to federal authorities. Others involved have pleaded guilty and have been sentenced, while some are awaiting trials.
"The St. Paul Federal Credit Union collapse resulted in one of the largest credit union failures ever investigated in U.S. history," Stephen D. Anthony, special agent in charge at FBI's Cleveland office, said in a prepared statement. "This complex, large-scale investigation transcended international borders and will continue until all those involved are brought to justice."
The NCUA, which lost $186.4 million as a result of the SPCFCU fraud case, closed the credit union and began its liquidation process in May 2010.
In November 2013 the NCUA filed a civil lawsuit that seeks a $6.9 million judgment against Vujovic and his wife Rada. That lawsuit is pending in U.S. District Court in Cleveland.
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Peter Strozniak
Credit Union Times reporter covering credit union operations, fraud, M&As, leagues, business continuity, and breaking news.
