The doctor says that, over time, he “was chasing CD rates,” depositing a total of $2.7 million in several CDs at Washington Federal. Then, he says, he got a call from the bank’s branch manager.

A month after Edward H. Gobbo got out of bankruptcy, Washington Federal Bank for Savings CEO John F. Gembara starting giving him loans of millions, records show. When the bank went bust, Gobbo or ...