Former Bank Vice President Sentenced to 15 Years in Federal Prison for Bank Fraud

PHOENIX—On June 1, 2012, U.S. District Judge Susan R. Bolton sentenced former bank vice president William Robert Liddle, 51, to 15 years in federal prison, followed by five years of supervised release, for defrauding Yuma’s AEA Federal Credit Union (AEA) out of more than $20 million. On May 21, 2012, Judge Bolton, after considering the defendants’ family circumstances, sentenced William Liddle’s wife, Rhonda Monica Liddle, 46, to 12 months of home imprisonment, followed by four years of supervised release, for her supporting role in the fraud committed against AEA. A federal jury previously found William Liddle guilty of 54 felony counts, including conspiracy, federal credit institution fraud, wire fraud, and money laundering, and found Rhonda Liddle guilty of 36 of those counts.

“William Liddle’s sentence of 15 years in prison should send the strongest possible message to bank insiders tempted to embezzle from the institutions in which its members place not only their money but also their trust,” said Acting U.S. Attorney Ann Birmingham Scheel. “The U.S. Attorney’s Office will continue to vigorously prosecute white collar criminals and press for lengthy sentences commensurate with the devastating consequences of their crimes, both to promote respect for the law and to protect the citizens of Arizona.”

“Today’s sentencing emphasizes the FBI’s commitment to bring those who conspire to participate in fraudulent business practices to justice,” stated FBI Special Agent in Charge James L. Turgal, Jr. “The Federal Bureau of Investigation, along with our law enforcement partners, is determined to investigate those individuals who profit from financial institution fraud through their own deception and greed. The FBI and the United States Attorney’s Office will continue to work together to combat all types of financial fraud.”

“The 15-year prison sentence is a punishment that fits the severity of the crime,” said Dawn Mertz, Special Agent in Charge of Internal Revenue Service Criminal Investigation. “Mr. Liddle will have time to reflect on how his actions pushed the credit union to the brink of failure and caused dozens of employees to lose their jobs.”

AEA hired William Liddle in 2004 to launch its business lending department, and in 2006, Liddle became AEA’s vice president of Business Lending. Using his position as a bank insider, Liddle approved risky business loans and loan increases to several entities owned in whole or part by Frank Ruiz, a resident of Yuma, in exchange for kickbacks in the form of at least $250,000 in cash, a $600,000 house, a Toyota Sequoia, and a Corvette. The entities Ruiz used to obtain the loans were financially unstable and unqualified for the loans, and the few legitimate projects that were funded by the loans ended in failure. A portion of the loan funds were used to develop the Kress Building in downtown Yuma and the Yuma Fun Factory, both of which went into foreclosure. Frank Ruiz pleaded guilty to felony offenses as a result of his participation in the fraud, cooperated in the prosecution of the Liddles, and was recently sentenced to two years in prison, followed by five years of supervised release.

As a result of the fraudulent loans William Liddle approved, AEA lost more than $20 million, was forced into conservatorship by the National Credit Union Administration, and had to lay off more than 80 employees. AEA has been working since 2010 to rebuild its reserves and, with the aid of a $20 million loan from the NCUA, is expected to recover from the fraud.

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.