A Folsom company has agreed to forfeit $6 million in money and property to settle lawsuits brought by the federal Small Business Administration.
The lawsuits say EDF Resource Capital Inc acted as an agent for the Small Business Administration in issuing and servicing loans.
According to federal court documents, EDF was required to bear a share of any losses suffered by the SBA. EDF was also required to maintain a loan loss reserve.
The federal lawsuits claimed that for three years, from 2009-2012, EDF did not maintain a proper reserve and hid the existence of hundreds of "troubled" loans to avoid paying its share of losses.
By signing a settlement agreement, the head of EDF, Frank Dinsmore, agrees to pay more than $200,000 and surrender the contents of two business accounts and three real estate properties.
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