Koljo Nikolovski, who had been indicted for taking out millions of dollars in fraudulent loans from the $240 million St. Paul Croatian FCU which were never repaid and led to the credit union's collapse in 2010, pleaded guilty on Monday to 18 counts of bribery, bank fraud and money laundering.

News Update:
Feb. 8, 2012: Cleveland Businessman Added to Indicted List

Of the $5.6 million in loans Nikolovski obtained, $2 million was sent to bank accounts in the Balkan republic of Macedonia, according to court filings in the Cleveland case.

Nikolovski, is scheduled to be sentenced in April and could spend up to nine years in prison.

Earlier this month, the credit union's former CEO, Anthony Raguz, pleaded guilty to bank fraud and agreed to testify against Nikolovski, who was scheduled to go to trial in February. In addition, six other people pleaded guilty to bank fraud, including Nikolovski's former wife, and agreed to testify against him.

Raguz has admitted to accepting $1 million in bribes in exchange for approving more than 1,000 loans totaling $70 million to borrowers who had no intention of repaying funds. He agreed to forfeit the $1 million.

In addition, Raguz admitted he made the loans without requiring collateral and knew the borrowers had few assets, no employment history and often used fictitious names.

The loans were ultimately signed over to Nikolovski.

The NCUA conserved and then closed the credit union, located in the Cleveland suburb of Eastlake, Ohio, in 2010. The failure cost the NCUSIF $170 million. At least eight other borrowers have also been charged in the case.

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Pivotal Figure in Collapse of St. Paul Croatian FCU Pleads Guilty

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