Tuesday, October 25 , 2016, 11:57 pm | Fog/Mist 57º


Local News

Rabobank Sues Heather Melchiori For Unpaid $1.3 Million Business Loan

Lawsuit claims breach of contract by ex-wife of Melchiori Construction Co. owner

Rabobank has filed a lawsuit against the ex-wife of embattled Melchiori Construction Co. president Mark Melchiori for failure to repay a $1.3 million business loan.

According to a lawsuit the bank filed Dec. 3, Heather Melchiori and her husband breached a contract they entered into with Rabobank on Jan. 28, 2010.

The Melchioris defaulted on loan payments, which were due July 5, 2011, according to the filing.

After Mark Melchiori acknowledged the default in May, Rabobank agreed to not take legal action until Aug. 30, the lawsuit states.

Two months later, Melchiori’s company filed for bankruptcy, citing as much as $10 million in debts. A personal Chapter 7 bankruptcy filing followed in November.

Melchiori has also been accused of not paying subcontractors, not making payroll and of borrowing money from employees without repayment.

Because of Heather Melchiori’s “failure and refusal to perform her payment obligations,” Rabobank is seeking no less than $1.3 million plus interest, late charges, other unpaid fees and attorneys’ fees, according to the lawsuit.

Heather and Mark Melchiori did not respond to a request for comment Thursday.

Rabobank joins a lengthy list of 170 creditors found in Mark Melchiori’s personal and business bankruptcy filings.

Santa Barbara Bank & Trust is also suing Melchiori’s company for an alleged default on a $6.3 million line of credit given by the bank.

Another lawsuit filed by Melchiori’s stepmother, Linda, alleged that his divorce from his wife earlier this year was a scheme to hide assets from creditors to which his company owes money.

Last month, a Santa Barbara County Sheriff’s Department spokesman told Noozhawk that Mark Melchiori is the subject of a criminal investigation by detectives looking into the now-defunct firm’s business operations.

Noozhawk staff writer Gina Potthoff can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.

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