The chief financial officer of a failed Bridgeport bank was sentenced Thursday to 18 months confinement to her basement apartment and ordered to help repay $27 million in losses from a yearslong embezzlement scheme that caused the bank’s collapse.
“You will be paying restitution for the rest of your life,” U.S. District Chief Judge Virginia Kendall said as she spared Rosallie C. Corvite from a prison sentence so she could care for her mother.
Corvite ended up with one of the lightest punishments of the 16 people charged after federal regulators closed Washington Federal Bank for Savings in December 2017, days after John F. Gembara, the bank’s president, CEO and chairman, was found dead in a customer’s home.
Among the customers charged was then-Ald. Patrick Daley Thompson, a grandson of the late Mayor Richard J. Daley and nephew of former Mayor Richard M. Daley, who was found guilty of lying to regulators about his bank debts to the bank and cheating on his federal taxes. The U.S. Supreme Court recently overturned Thompson’s conviction for lying, but not tax fraud.
Federal prosecutors urged Kendall to send Corvite to prison for 18 months, arguing she helped Gembara carry out the embezzlement scheme that cost the Federal Deposit Insurance Corp. more than $90 million. Much of that money hasn’t been recovered.
Corvite “repeatedly took steps to facilitate the embezzlement conspiracy and conceal its existence from regulators,” Assistant U.S. Attorney Jeffrey Snell wrote in court documents.
Corvite and her attorney, Douglas Whitney, maintained that she followed Gembara’s orders because she was afraid she would lose her $95,000-a-year job, her family’s primary source of income.
Corvite, 49, started as a teller at the bank in 2003 when she moved to Chicago from the Philippines, where was a secretary at a cellphone company. Eight years later, Gembara appointed her to replace Chief Financial Officer Barbara Glusak, who quit after discovering bank employees had altered loan documents. Glusak reported her findings to the bank’s board of directors, including Gembara’s sister Janice Weston, and to the U.S. attorney’s office. But nothing happened, and the embezzlement continued.
“John Gembara was an evil person,” Whitney said. “It’s well documented that he was corrupt and abusive.
“He put her in that position because she didn’t have the skills or experience … to root out what he was doing. John put her in there to do his bidding. Rosallie had nowhere to go. If she wanted to keep her job, the only way was to do what John Gembara said.”
Gembara, who replaced his father as the bank’s president and CEO, stole money from the bank by doling out loans to friends and associates without any expectation that they would repay the money. He also gave out loans without any collateral. And he ordered employees to hide the delinquent loans from federal regulators. It’s unclear when Gembara began looting the bank his family ran for three generations.
Four other bank employees are awaiting sentencing, including former vice president James Crotty who had been fired for allegedly stealing money set aside for postage stamps.
How much money Corvite must repay is unclear. It’s part of the $27 million in restitution Kendall had previously imposed against four bank customers convicted in the scheme, including Marek Matczuk, the handyman who owned the home where Gembara was found dead with a rope around his neck on Dec. 3, 2017. Matczuk told police Gembara killed himself, and authorities concurred.
Matczuk, 62, was convicted in the embezzlement scheme and sentenced to nearly 13 years in prison. He died Wednesday after he reportedly suffered a stroke at the federal prison in Terre Haute, Indiana.
READ THE ORIGINAL SUN-TIMES INVESTIGATION
Read the first story in the Sun-Times investigation of the failed Bridgeport bank Washington Federal Bank for Savings, published March 4, 2018.