A judge has rejected claims from a real estate developer that the NCUA-conserved AEA Federal Credit Union is still responsible for funding his projects.
Todd Burch was seeking $34 million against the Yuma, Ariz.-based AEA for alleged breach of contract claiming that the credit union severed his line of credit and filed suit against him to collect on his loan, the Yuma Sun reported in a March 15 article. Burch’s debt is an estimated $17.5 million.
On March 6, U.S. District Court Judge Frederick Martone rejected Burch’s move to block the NCUA from selling off his projects, according to the Yuma Sun.
Robert Cook, Burch’s attorney, said the AEA loans were in violation of federal limits on loans to one borrower of 10% of the credit union’s stated capital, the publication reported.
Burch claimed that AEA cut his credit line because the credit union was experiencing financial troubles and could not provide further funds to complete his real estate projects.
Cook said he will appeal the judge’s decision.
Martone allowed AEA’s counter claims to recoup funds that Burch allegedly still owes the credit union to remain in place. An April 20 scheduling conference is set to further address that matter.
Frank Ruiz, a real estate developer involved in a business lending kickback scheme that led to the collapse of AEA, could receive up to 15 years in prison for his role.
Prosecutors said Ruiz should receive a sentence of up to one year because he testified against William Liddle, the AEA loan officer, who recently pleaded guilty to more than 50 counts of fraud for his role in the $50 million kickback scheme.
U.S. District Court Judge Susan Bolton postponed Ruiz’ sentencing until April 9 to consider new evidence on how large a role he played in AEA’s financial downfall.