Texas bank sues Albuquerque credit union for fraud. It accuses U.S. Eagle of running a "pump and dump" scheme.

Fidelity Bank of Texas sued U.S. Eagle Federal Credit Union on Sept. 15 in U.S. District Court in Albuquerque, alleging breach of contract, breach of the duty of good faith and fair dealing, and fraud. This is what the complaint alleges. Every point is the bank’s claim. A court has decided nothing, and U.S. Eagle has not responded in court.

• In 2023, “it appears,” U.S. Eagle started “originating clearly risky and problematic loans,” got U.S. Department of Agriculture guarantees on them, and sold pieces at a premium “in order to raise capital to purchase other banks.” The complaint names the target: “Southwest Capital Bank located in Albuquerque, New Mexico.” U.S. Eagle agreed to buy that bank in August 2024. The deal did not close. In September 2026, Southwest Capital Bank’s parent company agreed instead to combine with WestStar Bank, a Texas bank.
• It says U.S. Eagle would sell pieces of those loans “to innocent and unsuspecting third-party lenders in order to bolster its own financial statement,” and “did not care about the quality of the loans it was originating and selling.”
• On Dec. 11, 2023, it made a $17.55 million loan to two South Carolina companies. USDA guaranteed $14.04 million of it.
• In early 2024 the bank bought $5.05 million of the loan and paid $5.67 million, including a $600,210 premium. It says it believes U.S. Eagle “made material misrepresentations and/or omitted material information” in the underwriting.
• The bank says, “upon information and belief,” that U.S. Eagle “was aware, at the time it made the Loan, that it was of such poor quality that it did not qualify for the USDA’s OneRD Program.”
• It says U.S. Eagle’s internal documents from August 2024 show “discussions about problems that existed with the Loan long before a portion of it was sold” to the bank.
• It says USDA turned down a change to the loan in part because “5 months passed until U.S. Eagle submitted a servicing plan,” and that the borrower had not paid property taxes for 2024 or 2025. “As a result of Defendant’s failure to appropriately service the Loan, among others,” it says, “the USDA revoked Defendant’s license and barred it” from the program.
• USDA has since repaid the guaranteed principal, but not the premium or the interest the bank expected to earn.
• The complaint calls U.S. Eagle’s loan sales “a pump and dump scheme”: it was “offloading the loans (i.e., a pump and dump scheme)” to raise capital.

The bank asks for about $2.88 million plus punitive damages. U.S. Eagle’s answer was due Oct. 8. As of Oct. 12, the docket showed none. More in part one of this series.