RICHMOND, Va. (CN) - U.S. Bank claims in court that an apartment building owner lied about the rent generated by his building to score a $25 million loan that's in default.
U.S. Bank sued TABAC owner Billy Jefferson Jr. in Federal Court.
Jefferson is in federal custody, according to the lawsuit, which alleges fraud.
"Specifically, and without limitation, Jefferson provided or caused to be provided to U.S. Bank and its agents rent rolls for the property stating that the rents being charged and collected for the residential units at the property were all either $1,000 per month or $1,250 per month," the complaint states. "In fact, the rents actually being charged and collected were substantially less than the amounts claimed, and in some cases less than half that amount."
According to the complaint, Jefferson guaranteed the loan, with an original principal of $25,480,000.
U.S. Bank says it gave that sum to Jefferson's company based on his false statements about the rent.
The bank wants Jefferson to pay it $26.1 million, a sum representing the original principal and accrued interest, along with punitive damages.
U.S. Bank is represented by Richard Hagerty of Troutman Sanders in Tysons Corner, Va.