CLEVELAND – A former county commissioner and business partner of local financier A. Eddy Zai was sentenced last week to five years of supervised release and one day in prison for his part in the huge fraud case that led to the 2010 collapse of St. Paul Croatian FCU.
Ted Vannelli, 66, Zai’s father-in-law, pleaded guilty to counts of aiding and abetting and conspiracy in helping Zai obtain $19 million of fraudulent loans from the $240 million credit union. He was given a reduced sentence because of his agreement to give testimony against Zai.
Vannelli worked with Zai, 43, to operate a slew of business entities created primarily to serve as a "safe haven" for illegal proceeds from the credit union, paying bribes to the credit union CEO Anthony Raguz to arrange for the loans. The payments were made to both induce Raguz, 52, to approve additional fraudulent loan applications and to reward him for having previously approved false loan applications, according to the indictment.
Zai and Vannelli also were alleged to have submitted false loan applications to Park View Federal Savings Bank. Park View suffered an estimated loss of $750,000, according to the indictment.
Raguz was sentenced last month to 14 years in prison. Zai's sentencing is scheduled for Feb. 5.
In exchange for Vannelli's cooperation with the case, the United States Attorney's Office dropped charges of bribery, financial institution fraud and false statements to a financial institution.
