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Investigation snares four more in bank fraud allegations

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Banking
Friday, September 18, 2020

Four new defendants who worked for a Chicago bank have been charged with fraud as the result of an ongoing criminal investigation.

Two Illinois attorneys were indicted last year for allegedly defrauding creditors and the trustee in a bankruptcy case by concealing cash and property.

Washington Federal Bank for Savings was shut down in December 2017 after the Office of the Comptroller of the Currency determined that the bank was insolvent and had at least $66 million in nonperforming loans.

Robert Kowalski and his sister, Jan, were indicted last year. A superseding indictment renewed the bankruptcy fraud charges against the pair while adding four former bank employees to the case.

The employees allegedly conspired with Robert Kowalski and higher-ranking bank officials to embezzle at least $29 million in bank funds in the years preceding the closure, a release from the Justice Department stated.

“The employees and the higher-ranking officials allegedly transferred the money to Robert Kowalski and others, often without any documentation, and falsified bank records to conceal the embezzlement from the OCC and the FDIC, the latter having become the receiver of the bank and provider of approximately $90 million to make account holders whole,” the release stated.

Newly charged in the conspiracy are: Rosallie Corvite, 45, of Chicago, who served as chief financial officer and treasurer; Jane Iriondo, formerly known as Jane V. Tran, 39, of Boise, Idaho, who served as corporate secretary; Alicia Mandujano, 49, of Chicago, who worked as a loan servicer; and Cathy Torres, 39, of Chicago, who worked as a loan officer.

The four employees face individual counts of falsifying bank records. In addition to renewing the bankruptcy fraud charges against the Kowalskis, the new indictment also adds several tax counts against Robert Kowalski for allegedly failing to file income tax returns and filing false personal and corporate returns for various years.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jay N. Lerner, Inspector General of the FDIC’s Office of Inspector General; Kathy A. Enstrom, Special Agent-in-Charge of IRS Criminal Investigation in Chicago; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago Field Office of the FBI; Catherine Huber, Special Agent-in-Charge of the Central Region of the Federal Housing Finance Agency, Office of Inspector General; Brad Geary, Special Agent-in-Charge of the U.S. Department of Housing and Urban Development's Office of Inspector General in Chicago; Assistant Inspector for Investigations Sally Luttrell of the Department of the Treasury, Office of Inspector General; Joseph M. Ferguson, City of Chicago Inspector General; and Elissa Rhee-Lee, Chicago Housing Authority Inspector General.  Valuable assistance was provided by the U.S. Trustee Program.  The government is represented by Assistant U.S. Attorneys Brian Netols, Michelle Petersen, and Jeremy Daniel.

The criminal investigation remains ongoing. The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

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