STUDIO CITY, Calif.–The former CEO of the now-defunct C B S Employees FCU has agreed to a plea deal with federal prosecutors in which he admits to stealing more than $40 million over the past 20 years.
As CUToday.info has reported extensively here, here, and here, Edward Rostohar managed to embezzle more than $40-million from a credit union that had just $21 million in assets at the time it was shuttered and merged into University Credit Union.
Prosecutors said the funds were used to pay for expensive cars and watches, private jet travel, gambling, and a number of properties, including his own 4,300-square-foot home in Studio City. According to court documents, Rostohar has agreed to forfeit millions of dollars in assets, as well as properties in California, a café in Reno, Nev., other properties in Nevada, and a resort property in Mexico. The values of those properties was not included in court filings, although his home is valued by Zillow as worth approximately $2.3 million.
Rostohar also agreed to forfeit a Tesla, a Porsche, a Lexus, a Chevy truck, the watches, and expensive jewelry.
Rostohar had been charged with two felony counts of bank fraud and one felony count of aggravated identity theft.
Rostohar was arrested on March 12 by Los Angeles Police as he was exiting his garage in his Porsche. Police said they found more than $275,000 in cash on him as he was attempting to drive away. Police had been called by his wife, Linda Tlenlsani, whom police said reported her husband had come into their bedroom that morning “in a panic." Rostohar stated, ‘I knew this day was coming. I’ve got to go. I have to leave the country. I’m a con. Everything is true. I don’t have time. I have to pack. I don’t want to go to jail. I’d rather die than go to jail.’”
But Rostohar is now going to remain in jail.
According to court documents, the scheme began to unravel when detectives with the LAPD said they were called to the offices of C B S Employees FCU by attorney Lysa Simon, who informed them the credit union suspected Rostohar had stolen “millions” of dollars. Detectives said they met with the credit union’s board president, Douglas Edwards, who indicated on March 6, 2019, Chery Sicka, assistant manager, was looking for a copy of a check, on which a stop payment had been placed.
‘Stumbled Across Check’
“While looking for the check, Sicka stumbled across a check in the amount of $35,000 made payable to Suspect Edward Rostohar, Manager,” the police report reads. “The check did not indicate why Rostohar had received such a high dollar amount check. Sicka became concerned and conducted an audit of C B S Employees Federal Credit Union checks issued since January 18 to the present and uncovered numerous checks made payable to Rostohar. The total amount of the checks is approximately $3,775,000.00.”
The police report states Sieka noticed that all the checks payable to Rostohar contained what appeared to be the signature of Anna Nalbandyand, an MSR with the credit union, who subsequently stated she had not signed the checks and did not know why the checks were issued to Rostohar.
Rostohar, 62, had been scheduled to go to trial on June 11 in Los Angeles. But according to the Los Angeles Business Journal, citing court documents provided by the U.S. Attorney’s Office in Los Angeles, Rostohar agreed in a May 10 hearing to plead guilty to one felony count of bank fraud. The government is recommending a prison sentence not longer than 15 years.