Tuesday, December 1, 2020

Former Columbus mayor Eisenga charged with bank fraud

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A former Columbus mayor and businessman who was once at the center of a controversial bill aimed at reducing child support payments for wealthy parents was indicted Thursday on a federal bank fraud charge.

The indictment alleges that Michael Eisenga, who as a major GOP donor about 10 years ago had enlisted state Republican legislators to change state law that would have reduced his child support payments, took out a loan from an Illinois credit union for commercial property in Columbus under false pretenses.

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The indictment states Eisenga, 49, had applied for a loan of nearly $7 million from Alliant Credit Union of Rolling Meadows, Illinois, seeking to buy property in Columbus that he claimed was under a 20-year lease to Festival Foods, a lease purportedly guaranteed by Supervalue Holdings, Inc.

But neither of the documents, the lease or the guarantee, was genuine, the indictment states. The lease never existed, nor did the guarantee, according to the indictment.

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But relying on Eisenga’s representations and documents, the indictment states, Alliant approved the loan in February 2017 and paid out $6.9 million to Eisenga.

In January 2019, after Eisenga’s company, CCC Lot 2, defaulted on the loan, Eisenga gave Alliant a lease cancellation agreement that purported to be an agreement terminating the lease with Festival Foods effective February 2018, but that document was not genuine, either, the indictment alleges.

“My client and I will cooperate fully with the government in this matter,” Eisenga’s lawyer, Chris Van Wagner, said in a statement. “Mr. Eisenga looks forward to resolving this matter promptly and properly.”

The matter was the subject of a civil lawsuit heard in Columbia County Circuit Court. Alliant sued Eisenga last year to foreclose on the mortgage. A default judgment was entered in July 2019 and a sheriff’s sale was held in October 2019, netting $2.2 million for the property, according to court records.

Court records state Alliant was awarded a judgment of just over $5 million, plus punitive damages that were agreed to in September by both sides. Eisenga also filed bankruptcy petitions for himself and for CCC in February, a move that Alliant’s attorneys said in a bankruptcy court filing was a move to forestall the foreclosure proceeding in Columbia County.

CCC’s bankruptcy case was dismissed by a federal bankruptcy judge in July.

In 2014, state Rep. Joel Kleefisch withdrew a bill that was aimed at helping Eisenga — a former mayor of Columbus who was described at the time as a multimillionaire developer and owner of several financial firms — reduce what he pays in child support. Eisenga had helped write the bill. The Wisconsin State Journal reported that Kleefisch met with Eisenga and Steve Foti, a lobbyist and former Assembly majority leader, in December 2010 to discuss changes to the law that governs prenuptial or premarital agreements.

Drafting documents indicated Eisenga and his attorney worked closely with Kleefisch and his office to ensure the bill was written so Eisenga could reopen his child support order.

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