Three Yuma residents charged with fraud against AEA Federal Cred

December 2, 2010

Three Yuma residents charged with fraud against AEA Federal Credit Union

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Frank Ruiz and Bill Liddle Frank Ruiz and Bill Liddle

Yuma, AZ December 2 -- A federal grand jury in Phoenix has returned a 68-count indictment against William "Bill" Liddle, 50, AEA Federal Credit Union's former vice president of business services.  Bill Liddle's wife, Rhonda Liddle, 45, and Frank Ruiz, 61, are also charged.  All three face charges of committing fraud against AEA Federal Credit Union, located in Yuma and Parker, Arizona. 

The indictment alleges that William Liddle conspired with Yuma businessman Frank Ruiz to approve suspicious business loans in exchange for almost $1 million in kickbacks to Liddle and his wife. 

All three defendants were arrested and arraigned in federal court Thursday.  The Liddles and Ruiz said very little in court.  They told the judge they understood the charges against them and all three entered pleas of not guilty.  All three were shackled during the proceedings and were hand-cuffed before leaving court today.  All three accused have court-appointed attorneys.

According to the U.S. Attorney's Office, all of Ruiz's business ventures funded by the AEA loans, including the Yuma Fun Factory have ended in bankruptcy.  The Fun Factory closed in April of this year.  Ruiz also owns The Top of the Kress nightclub and bar in downtown Yuma.  It is still open.

In a release Thursday, The U.S. Attorney's Office said more than $25 million in AEA loans Liddle authorized during the alleged conspiracy remain in default.  The U.S. Attorney' Office says all three defendants recently declared personal bankruptcy as well.    

"Financial institutions are not personal fun factories for its officers and their anointed business pals.  The defendants' selfish scheme has come full circle and they are already paying a price for their greed," said U.S. Attorney Dennis K. Burke. "They have victimized not only a financial institution but an entire community and jeopardized that community's faith in this institution.  We will make sure they are also held accountable for their disregard of the law and the consequences suffered by the credit union."

FBI Special Agent in Charge Nathan Gray said, "The indictment of Mr. and Mrs. Liddle and Mr. Ruiz is the culmination of an extensive FBI and IRS investigation that exposed their loan kickback scheme to obtain fraudulent business loans."

The Liddles and Ruiz turned themselves in Thursday morning.  The Liddles have know about the investigation for many months.  Bill and Rhonda Little, along with Frank Ruiz will be under the supervision of pre-trial services until their court date in February.  They had to surrender their passports and will have monthly checks by a representative from pre-trial services.

AEA Federal Credit Union's third quarter financial report (available on the National Credit Union Administration's website) shows that AEA is undercapitalized, its delinquent loan rates — primarily business member loans — have risen sharply from a year ago and foreclosures and bankruptcies continue to take their toll on the credit union.

Denise Sweet-McGregor, Interim CEO of AEA Federal Credit Union released this statement on Thursday, "The details of the investigation over the past 11 months have been difficult to suppress. While rumors have been rampant about what members of the community and the media have imagined, we were not at liberty to confirm or deny any of those rumors.  However, now that the information about the alleged illegal actions of Mr. Liddle and others has been released by the FBI, the community can now understand why AEA has had to bear such severe financial losses this past year.  The harm caused by these alleged actions to AEA's members and dedicated employees is unconscionable."

Each account at AEA is insured up to $250,000 by the National Credit Union Share Insurance Fund.

According to the release from AEA Thursday, Mr. Liddle was hired by AEA in November of 2004 to develop and manage a business services program for AEA based on his formal education, and professional expertise in commercial lending and international business.  Mr. Liddle resigned from his position in December of 2009, stating his intention to devote full-time attention to a business, Desert Capital Advisors, LLC.

Convictions for counts of fraud alleged in the indictment carry a maximum penalty of 30 years in prison, a $1 million fine or both.  In determining an actual sentence, the district court judge will consult U.S. Sentencing Guidelines, which provide appropriate sentencing ranges.  The judge, however, is not bound by those guidelines in determining a sentence.

 

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