A former credit union employee from Columbia was sentenced to a little more than 10 years in federal prison for fraud, money laundering, “misapplication of funds” and making a false record to Scott Credit Union.
In a news release, the U.S. Attorney’s Office of the Southern District of Illinois said 51-year-old Theodore J. Longust was sentenced as a result of his convictions in a nine-count indictment. U.S. Attorney Donald Boyce said Longust used to be a Scott Credit Union employee in the commercial loan department. He worked there from Nov. 7, 2005 to Dec. 8, 2014.
Boyce said Longust “executed a scheme to defraud” by embezzling credit union funds, creating fraudulent loans, paying loans through the misapplication of funds from other loans, increasing credit limits on unapproved loans, issuing undocumented business loans and issuing undocumented letters of credit.
The U.S. Attorney’s Office also said Longust knowingly submitted a false report to his employer for the third quarter of 2014 that had “misstated loan balances and omitted loan amounts and under-reported loans” of more than $12 million.
Scott Credit Union overall lost $25.8 million, Boyce said, which included criminal and civil losses. Boyce said direct criminal losses were $13,719,947.21.
The court sentenced Longust to more than 10 years in prison, but also ordered him to pay $5,012,362.52 in restitution to Scott Credit Union and $9,114,560.69 to CUMIS Mutual, the bonding company for Scott Credit Union.
The U.S. Attorney’s Office said Scott Credit Union “has not been adversely affected” by the wrongdoing as a result of Longust’s actions.
The case was investigated by the FBI and criminal investigators with the IRS with assistance from Scott Credit Union. It was prosecuted by Assistant U.S. Attorney Norman Smith.