Former Yuma Bank Vice President and Spouse Convicted of Fraud

PHOENIX—On Feb. 10, 2012, a Phoenix federal jury found William Robert Liddle, age 51, guilty of conspiracy, 44 counts of federal credit institution fraud, three counts of wire fraud, and six counts of transactional money laundering. The same federal jury found Rhonda Monica Liddle, age 46, guilty of conspiracy, 30 counts of federal credit institution fraud, and five counts of transactional money laundering. The Liddles currently reside in Phoenix, Ariz. The case was tried before U.S. District Judge Susan R. Bolton between Jan. 18, 2012, and Feb. 10, 2012, and the jury returned guilty verdicts after deliberating for two days. The defendants’ sentencing is set before Judge Bolton on May 21, 2012.

“I commend the FBI, the IRS, and our prosecution team for their outstanding work in the investigation and prosecution of this complex financial fraud scheme,” said Acting United States Attorney Ann Birmingham Scheel. “Financial crimes of this magnitude have a devastating effect on our communities. My office will continue to work with our law enforcement partners to prosecute those who seek to profit from financial fraud.”

“This type of fraud undermines and weakens our trust in our financial system”, stated FBI Special Agent in Charge James L. Turgal Jr., Phoenix Division. “The Liddles conspired to line their pockets with ill-gotten gains to support their greed. These guilty verdicts are the culmination of efforts by the Federal Bureau of Investigation, the Internal Revenue Service, and the United States Attorney’s Office. The FBI and our law enforcement partners are committed to combating financial institution fraud in Arizona.”

Dawn Mertz, the Special Agent in Charge of the Criminal Investigation Division for the Internal Revenue Service Phoenix Field Office stated ”Mr. Liddle, with the assistance of his wife, abused his position as an officer of AEA Credit Union for their own financial gain. Their actions had a devastating effect, leaving many individuals and businesses in dire straits, while they spent the illegal funds on extravagant items. After reviewing over 45,000 documents and tracing the movement of millions of dollars, the special agents secured crucial evidence documenting the illegal activities of the Liddles. The number of charges they were convicted of underlies the severity of their actions. The IRS will continue to aggressively pursue those who would perpetrate these schemes that threatens the stability of our country’s financial infrastructure.”

The evidence at trial showed that William Liddle, who served as the vice president of business lending for Arizona Education Association Federal Credit Union (AEA) between 2006 and 2009, and his wife Rhonda, conspired to defraud AEA out of millions of dollars in loan funds. Evidence presented at trial revealed the following facts:

• Starting in 2006, William Liddle began approving loans and loan increases to entities owned in whole or part by Frank Ruiz, and organized as Desert Best Enterprises, Desert Best Distributing, Desert Best Technology, Yuma Fun Factory, and CTW. William Liddle issued millions of dollars of loans to Frank Ruiz’s entities knowing that Ruiz was financially unqualified and that his entities were failing financially. A significant portion of the loan funds were used to develop the Kress Building in downtown Yuma, and the Yuma Fun Factory;
• William Liddle repeatedly issued loans to Ruiz’s entities because Liddle was a silent partner or owner of the Kress business project and the Yuma Fun Factory. For both projects, William Liddle was often seen at the construction sites directing the work of sub-contractors, selecting products for purchase, and making hiring and salary decisions. In numerous instances, William Liddle was identified as an owner or a principal of the Yuma Fun Factory on document evidence shown at trial. It was learned that William Liddle intended to leave his employment at AEA and become a consultant or owner for the businesses he funded as an AEA employee;
• William Liddle issued loans and increases to an entity called CTW, which he helped Frank Ruiz form. Soon after CTW was formed in May of 2007, William Liddle began directing Frank Ruiz to take loan draws from CTW, to cash the loan draws in $100 bills, and to provide the cash to either himself or to Rhonda Liddle. Some of the CTW loan funds were used to purchase a 1980 Corvette and a Toyota Sequoia for the Liddles;
• Starting in May of 2009, William Liddle directed approximately $800,000 in CTW loan funds to a Desert Capital Partners bank account, owned by a friend of the Liddles. William Liddle then directed his friend to withdraw the funds and provide cash, in the form of $100 bills, to either himself or to Rhonda Liddle;
• In addition to receiving cash kickbacks, the Liddles also used CTW loan money to purchase and renovate a half million dollar house on Parkway Avenue, in Yuma, Arizona. On May 26, 2009, the Liddles opened a trust account at Chase Bank. Three days later, their friend, while acting at the direction of William Liddle, transferred approximately $575,000 into the Liddles’ trust account. On the same day, Rhonda Liddle withdrew approximately $564,000 from the account to pay for the Liddles’ purchase of the home on Parkway Avenue; and
• The Liddles received over 40 cash kickbacks during the scheme, totaling over $250,000. Rhonda Liddle deposited the cash kickback for almost every transaction. Over the course of the conspiracy, the Liddles received over one million dollars in property and cash kickbacks from the loans issued by William Liddle.

A conviction for conspiracy carries a maximum penalty of five years, a $250,000 fine, or both. A conviction for federal credit institution fraud carries a maximum penalty of 30 years, a $1,000,000 fine, or both. A conviction for wire fraud carries a maximum penalty of 30 years, a $1,000,000 fine, or both. A conviction for transactional money laundering carries a maximum penalty of 10 years, a $250,000 fine, or both. In determining an actual sentence, Jude Bolton will consult the U.S. Sentencing Guidelines, which provide appropriate sentencing ranges. The judge, however, is not bound by those guidelines in determining a sentence.

The investigation in this case was conducted by the Federal Bureau of Investigation and the Internal Revenue Service. The prosecution was handled by Assistant United States Attorneys Monica Klapper, Peter Sexton, and Raymond K. Woo.