RYE, N.Y. -- John P. Walsh, the former chief operating officer of Affina Brokerage Services LLC, a subsidiary of USAlliance Federal Credit Union, has been charged with theft for allegedly stealing $2.5 million from the CUSO.

Joann Kay, assistant vice president of marketing at $664 million USAlliance FCU, confirmed the details in several local reports that said Walsh unlawfully transferred stock from Affina Brokerage into accounts under his management and sold the shares for his personal use. Kay also confirmed that Walsh came up with fake stock positions that were used as collateral for loans between June 17, 1999 and Jan. 1, 2008.

"For legal reasons, I can not discuss specifics of the case," Kay said adding USAlliance FCU President/CEO Michael Ambrose was out of the office this week. "It's in the hands of the legal system. Our attorneys are taking care of this."

The Westchester County District Attorney's Office is prosecuting the case, said spokesman Lucian Chalfen. He confirmed with Credit Union Times that Walsh was arrested on Jan. 6 and charged with first-degree grand larceny, which in New York, means theft involving an amount over $1 million. Walsh is still in jail and is scheduled to appear back in court on Jan. 27.