CLEVELAND – The last of 26 people charged in the massive fraud at St. Paul Croatian FCU pleaded guilty yesterday to bank fraud and money laundering in the $185 million scheme.
Marko Nikoli was one of about a dozen straw borrowers who took out fraudulent mortgages from the credit union and siphoned the funds to Koljo Nikolovski, who is Nikoli’s uncle. Nikolovski, a purported Balkans crime lord, was convicted last year of arranging more than $6 million in loans from the credit union, either directly or through family and friends, that he never intended to repay. Most of the funds were transferred to bank accounts in Macedonia and Albania and are subject to a restitution order.
Marko Nicoli arranged loans of $500,000 from the credit union as part of the fraud, then transferred to money to Nikolovski's accounts in Skopje, Macedonia. He is scheduled to be sentenced March 18, 2013.
Among the other straw borrowers convicted in the fraud are Nikolovski’s ex-wife Rose Nikolovski, her brother John Cendol, Jr., Cendol’s wife Ruth Cendol, and their son Edward Watral.
The CEO of the one-time $240 million credit union, Anthony Raguz, has also pleaded guilty to approving all of the loans in exchange for more than $1 million in bribes. He is scheduled to be sentenced Nov. 26 but is expected to receive a reduced sentence because he testified against Nikolovski and the other borrowers, including A. Eddy Zai, the Cleveland financier who pleaded guilty earlier this month to obtaining $19 million in fraudulent loans from the scheme.
NCUA has put the losses from the 2010 collapse of the credit union at more than $186 million, making it the biggest credit union fraud ever. NCUA said last week it has filed 61 separate suits against borrowers seeking recovery of $44.6 million. The agency has so far recovered $1.2 million in the case.