Credit union liquidated as manager charged with embezzlement
LOS ANGELES (AP) — A credit union that serves employees of the CBS television network has been liquidated as one of its long-time managers faces charges of embezzling $40 million from the institution over a 20-year period, authorities announced Friday.
Edward Rostohar, 62, of Studio City, California, was arrested March 12 and charged in connection with embezzling money from the CBS Employees Federal Credit Union to pay for a gambling habit, buy luxury cars and watches, and travel by private jet, the U.S. Attorney’s Office said.
Rostohar was ordered detained after a judge found that he was a flight risk and an economic danger to the community. It’s unclear whether Rostohar has an attorney.
The charges were announced the same day as the National Credit Union Administration said the credit union was insolvent and had no prospect of restoring operations on its own. University Credit Union in Los Angeles assumed CBS Employees’ assets, loans and member shares, according to prosecutors.
A statement on the website of CBS Employees Federal Credit Union tells its members that their accounts will remain unchanged until systems are fully transferred on Monday.
“University Credit Union was selected because of the safety and soundness of the institution, the robust product offerings for members, and the credit union’s ability to provide the best possible member experience through this transition,” the statement said.
Prosecutors said Rostohar used his position as a manager to make online payments to himself from his employer or by forging the signature of a fellow employee on checks made out to himself.
They say the embezzlement began sometime before 2000 and continued until March 6, when prosecutors say a credit union employee found a $35,000 check made out to Rostohar without a reason listed for the high dollar amount.
That’s when the employee conducted an audit and found $3.7 million in checks had been made out to Rostohar since January 2018, prosecutors said. He was suspended from his job shortly after.
Rostohar was arrested after his wife called 911 to say her husband had stolen money from his employer and was about to leave the country, prosecutors said.
They said Rostohar acknowledged stealing money from the credit union for 20 years and estimated that he had taken more than $40 million, a figure confirmed with the National Credit Union Administration.