Former Scott Credit Union Loan Officer Indicted For Fraud

Theodore J. Longust, 50, formerly from Columbia, Illinois, was indicted on November 18, 2015, by a federal grand jury in East St. Louis, Illinois, in a nine count Indictment charging: Count 1: Financial Institution Fraud; Counts 2 - 5: Misapplication of Funds; Counts 6 - 8: Money Laundering; and Count 9: Making a False Record to Scott Credit Union With The Intent to Deceive, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.

The indictment alleges that Longust was an employee and officer of Scott Credit Union in the commercial loan department from November 7, 2005, continuing through December 8, 2014, and held the title of Business Relationship Manager. The indictment further alleges that he executed a scheme to defraud through the embezzlement of credit union funds, the creation of fraudulent loans, the payment of loans through the misapplication of funds from other loans, the increase of credit limits on loans that did not have the requisite board approval, the issuance of business loans without the required documentation or security and the issuance of letters of credit without the required documentation and security. The indictment also alleges that Longust knowingly submitted a false report to Scott Credit Union for the 3rd quarter of 2014 that misstated loan balances and omitted loan amounts and underreported loans of over $12,000,000.

If convicted, Longust faces a prison sentence of up to 240 years, a fine of up to $4,500,000, and up to 5 years supervised release, and mandatory restitution. The safety and soundness of Scott Credit Union has not been adversely affected by the criminal conduct. Employees of Scott Credit Union cooperated in the federal investigation.

An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.

The prosecution is the result of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service/Criminal Investigations, with the assistance of Scott Credit Union. The case is being prosecuted by Assistant United States Attorney Norman R. Smith.