Hunt Abandoned : $2.9 Million Just Lost, Bank Says

The case of the missing San Fernando Valley checks is closed, chalked up to mishap rather than misdeed.

Last March, headlines proclaimed the mysterious disappearance of $2.9 million worth of deposits, including $8,000 in cash, from First Interstate Bank, which said the loot vanished somewhere between the Valley and the bank’s downtown processing office.

The bank said the missing March 3 deposits were stolen, and that it had some idea who was to blame. First Interstate isn’t saying that anymore, and Los Angeles police said Friday that there doesn’t appear to have been a crime.

Both parties now say the deposits were merely lost somewhere.

“We conducted an investigation, and there were no suspects,” said Lt. Howard Hughie, the detective in charge of the probe. “It turned out to be a big nothing.”

Hughie said the case is closed, and bank spokesman John Popovich said the bank has given up trying to figure it out, too.

Both said no one ever determined exactly what became of the missing deposit bags, which contained the $8,000 in cash deposited at First Interstate automated teller machines along with the checks, most of which, Hughie said, were non-negotiable.

Popovich added that the loss, which involved about 1,500 customers of four First Interstate branches, wasn’t as dire as it first seemed.

Aside from sorting out the bookkeeping and soothing ruffled customers, cash losses were limited to the $8,000.

Popovich said all customers’ accounts have been credited, and that procedures have been tightened to prevent a recurrence. For example, the bank now transports cash only in armored cars, so at worst a similar mishap would be limited to checks, he said.

The bank spokesman said he didn’t know whether the losses were insured, but the bank appears able to withstand the setback. Based in Los Angeles, First Interstate Bancorp has assets of about $57 billion, he said.

Hughie said the case was closed two months after it was opened, but no announcement was made.

“First Interstate didn’t want any more publicity,” he said. “It got kind of blown out of proportion.”