Frank Ruiz's homes now owned by AEA Federal Credit Union
Two houses owned by former businessman Frank Ruiz are now the property of AEA Federal Credit Union.
The credit union acquired the deeds to the houses in trustee sales held last week, confirmed AEA attorney Michael King.
In another development involving Ruiz, who currently is serving a two-year sentence in a federal prison in Colorado for his role in defrauding AEA of millions of dollars, U.S. Bankruptcy Judge James Marlar has ruled that Ruiz will not be able to avoid his restitution obligation to the credit union through bankruptcy.
In a partial judgment of Ruiz's bankruptcy case in July, Marker ordered that “the debt that Ruiz owes to AEA as reflected in the criminal restitution award, in a principal amount of $6,347,356, is non-dischargable in bankruptcy.”
The restitution had been ordered by U.S. District Judge Susan Bolton in June after she sentenced Ruiz.
Ruiz had filed for bankruptcy in 2010 after a grand jury indicted him on several felony counts related to his role in the misuse of AEA funds. As part of a plea agreement, Ruiz received a lesser sentence for assisting in the successful prosecution of his co-defendants, former AEA business loan officer William Liddle and Liddle's wife, Rhonda.
In a letter to the court, AEA President and CEO Thomas Martin wrote that the unpaid principal balances of loans made to Ruiz or guaranteed by him, less anticipated recoveries from the sale of assets acquired, came with a price tag of $18.9 million.
Also as part of Ruiz' bankruptcy, AEA as the beneficiary held trustee sales July 31 of his two houses.
One at 1324 E. 20th St. had an original principal balance of $304,593. AEA acquired the deed to it for $290,000, according to legal documents.
The second house, which also listed Ruiz's wife, Jacqueline Ruiz, as co-owner, is at 17148 S. Avenue B in Somerton. It had an original principal balance of $328,000. AEA acquired the deed for $325,000.
The locks were changed this week.
Jacqueline Ruiz protested that she had not been given an opportunity before that to claim personal property from the house she had left behind when she moved out, according to attorney Ashley Adams. Adams also said that the couple is divorcing.
King explained that while Ruiz's bankruptcy had not yet been discharged, the court allowed AEA to proceed with the trustee sales to recover some of the collateral on Ruiz's loans.