The Liddles were found guilty of using loan kickbacks to finance their lavish lifestyle, including purchasing a 1985 Corvette, a Toyota SUV and a $500,000 home, according to court records.

On Feb. 11, an attorney representing Rhonda Liddle told the Ninth Circuit Court of Appeals that federal prosecutors did not have enough evidence to prove Rhonda Liddle participated in the scheme, and that the jury received confusing instructions, according to an audio recording of the proceedings.

Arizona attorney Daniel Drake argued that the jury received dual instructions that lead to an inconsistent verdict. For example, he said, the jury convicted Rhonda Liddle of money laundering related to the purchase of a Toyota SUV, but acquitted her of bank fraud associated with the same purchase.

Drake said Liddle made bank transactions in her own name and made no effort to conceal any of the banking transactions, which points to her innocence.

“Assuming Ms. Liddle knew the funds had no legitimate source or had been taken from AEA by fraud and deceit, as the prosecution suggests, it is illogical and unreasonable to believe that she would deposit the ill-gotten cash into her very own bank account, thus creating a clear record where previously none existed,” the court documents said. “Funds

untraceable because they were converted to cash became traceable because she deposited the cash into her own bank account. That does not square with guilty knowledge or intent to deceive.”

Another bone of contention involved a backdated promissory note, which Rhonda Liddle allegedly used in attempt to cover up criminal activity.

“The prosecution offered no evidence that Ms. Liddle backdated the note or participated in preparing the note, other than signing her name,” the court documents said. “There is no evidence at all concerning what she knew at that time she signed the note. Instead, the prosecution claims the jury was right to draw a conclusion that the note established Ms. Liddle's knowing participation in the conspiracy. That is nothing more than speculation.”

Ninth Circuit Judge Richard Tallman said Liddle didn't strike him as an innocent housewife who had no idea her husband was stealing, although she used that defense in the trial.

“She received, on many occasions, substantial sums of money and then engaged in obstructive activity when the FBI tried to interview witnesses,” Tallman said. “This doesn't strike me as someone who wasn't involved.”

Tallman said that any reasonable jury would have inferred that Liddle was aware that the large amounts of cash coming into her household were ill-gotten gain, based on the evidence.

Monica Klapper, an attorney for the prosecution, told the court that it was necessary and appropriate for the jury to receive dual instruction. Despite an objection by the Liddles' defense team, the district court gave a deliberate innocence instruction, according to court records.

The instruction told the jury:

“You may find that the defendant Rhonda Liddle acted knowingly if you find beyond a reasonable doubt that:

1. She was aware of a high probability that the money and property she received were the result of criminal conduct; and,
2. She deliberately avoided learning the truth.

However, you may not find such knowledge if you find that she actually believed the money and property she received were not a result of criminal conduct, or if you find that she was simply careless.”

Rhonda Liddle's defense contends that the instruction misstated the law, misled the jury, and reduced the prosecution's burden of proof.

“First, the instruction was an incorrect statement of law as to the conspiracy and the credit union fraud counts,” the court documents said. “They required a more precise knowledge. Required to prove those counts was knowledge that the money and property arose from a loan made through AEA. It is undisputed that the government must prove at least the degree of criminal intent necessary for the substantive offense in itself in order to prove the conspiracy.”

The jury also received a deliberate ignorance instruction 10 days into the trial, which seemed to catch Ms. Liddle's trial attorney off guard because it seemed like a shift in the prosecution's approach, according to court documents.

Drake argued that the prosecution offered insufficient evidence of deliberate ignorance to justify giving the instruction, and that doing so confused and misled jurors.

This is not the first time the case has taken an unusual twist.

In 2012, William Liddle claimed he was stabbed on his way to his sentencing hearing.

The NCUA placed the credit union in conservatorship in December 2010 – right after the Liddles and Ruiz were arrested.

Liddle had been hired in 2004 to develop and manage a business services program, but he resigned from the credit union in 2009. Following his departure, AEA FCU detected inconsistencies, which prompted an audit, according to court records.

Although the credit union's future looked bleak in 2010, AEA FCU posted $5.2 million net income in 2013, according to the credit unions' NCUA financial performance reports.