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The U.S. Court of Appeals for the Sixth Circuit has ruled that a fidelity bond did not cover losses arising from actions by the former chief operating officer of Cleveland, Ohio-based St. Paul Croatian Federal Credit Union, which led to the largest credit union failure in U.S. history.
Losses from bribery and fraud
In 2000, Anthony Raguz, St. Paul's chief operating officer, began to take bribes in exchange for fraudulent loans. By 2010, Raguz had taken more than $1 million in bribes and St. Paul had lost about $72.5 million due to fraudulent loans.
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