Edward Martin Rostohar, 62, of Studio City, has pleaded guilty to one felony count of bank fraud after looting $40 million from CBS Employees Federal Credit Union over 20 years—a heist that left the institution insolvent and forced federal liquidation. The former manager funneled the stolen funds into gambling, luxury real estate across California, Nevada, and Mexico, private jet travel, and a lavish personal lifestyle, all while covering his tracks with forged signatures and falsified records.
Rostohar entered his plea before U.S. District Judge Otis D. Wright II in Los Angeles, who set sentencing for September 16. Facing a statutory maximum of 30 years in federal prison, Rostohar admitted to using his authority as a senior manager at the federally insured credit union to make unauthorized online payments to himself and forge the signature of another employee on checks. A trained accountant and former examiner at the National Credit Union Administration (NCUA), Rostohar exploited his insider knowledge to hide more than $40 million in losses by manipulating financial statements and making the failing institution appear profitable.
Court documents reveal Rostohar funneled stolen funds through shell companies he controlled and used credit union checks to pay off personal credit card debt. He also directed tens of thousands of dollars to cover expenses for a coffee business he launched in Reno, Nevada, in December 2018, including writing checks to cover a $5,000 monthly mortgage on a Reno home. Investigators say he lived like a high roller—gambling away millions, flashing expensive watches, and giving his wife a weekly $5,000 allowance.
The fraud unraveled in March when a suspicious $35,000 check payable to Rostohar triggered an internal audit, which uncovered $3.8 million in unauthorized checks issued to him between January 2018 and March 2019. The probe widened, exposing the full scope of the two-decade scheme. Rostohar was arrested on March 13 and has remained in federal custody ever since.
As part of his plea agreement, Rostohar has agreed to forfeit all ill-gotten assets, including bank accounts in his name and those tied to his shell companies, four luxury vehicles— a Porsche, Tesla, and Lexus among them—residential properties in Studio City, Reno, and Mexico, high-end watches, and Tiffany jewelry. The forfeiture represents one of the largest asset seizures in a single-fraudster case in recent Southern California history.
The fallout from Rostohar’s crimes was catastrophic. The NCUA declared CBS Employees Federal Credit Union insolvent with no path to recovery, forcing its liquidation. In March, University Credit Union of Westwood took over its assets, loans, and all 2,798 member shares. At the time of collapse, the credit union reported just over $21 million in assets. The FBI and Los Angeles Police Department led the investigation, with prosecution handled by Assistant U.S. Attorneys Andrew Brown of the Major Frauds Section and Victor Rodgers, deputy chief of the Asset Forfeiture Section.
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Key Facts
- State: California
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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