"The credit union has not yet been served with a copy of the lawsuit filed on behalf of Lori Parks and Phillip Maddox, but it appears that these plaintiffs are persons who did business with Danny Butler, who is currently serving a prison term for his fraudulent acts, including acts against Alabama One Credit Union," Carruth wrote. "It is unfortunate that the credit union is subject to another baseless claim from others who are seeking to hold the credit union responsible for their own decisions and business dealings with Butler. The credit union denies the allegations against it and will vigorously defend against them. So far, the credit union has successfully rebutted similar claims and has not paid out a dime in damages to any party making such claims."

Carruth's statement may be technically correct when it comes to cash settlements, but court documents reveal that at least one of the cases that is settled or nearly settled has cost the credit union significantly. 

According to the settlement agreement, while Alabama One did not pay cash to Jerry and Brenda Griffin,  the credit union has modified their loans and loan terms; renewed or extended loan agreements; made additional loans at advantageous interest rates; cancelled debts; released and sold property and improvements; cancelled injunctions and refunded bonds; and released claims against the couple.

The Parks and Maddox filings bring the number of cases against Alabama One to seven. Five are still active, one has been settled and the Griffins' is close to being settled, legal sources have said.

A legal source familiar with cases Parks filed on behalf of Alabama One members explained that cases of this type are not formally class action cases but are akin to class actions in that they are filed on behalf of groups of plaintiffs and require the court to recognize the validity of that plaintiff group.

Read more: Complaints allege credit union falsified business documents…

In the complaints, Parks alleged that her husband Chuck Parks and his friend and business partner Phillip Maddox had expressed an interest in July of 2008 in purchasing a piece of property Danny Butler owned off of Highway 43 North, near Tuscaloosa.

Both Parks and Maddox had admired the property previously, but Butler had not wanted to sell. Then, Butler said he needed to sell the property to reduce his debt load with Alabama One. Parks and Maddox sent a loan application to Alabama One and quickly received a call back from Ewing, the complaints alleged.

Ewing allegedly told Parks and Maddox that Parks would not qualify for a loan since he was self-employed, but suggested Maddox form a second LLC along with Chuck's wife Lori, who had a full time job. They did so on July 29, 2008, calling it American Auto Sales, LLC and recorded its formation on July 30, 2008. 

On the very same day, July 30, Butler sold American Auto Sales LLC the property for $540,000 with a loan from Alabama One, according to the complaint. Parks and Maddox added in the complaint that the $540,000 price represented 80% of the $730,000 that Alabama One's appraiser, Mary Jane Watson, had calculated as its worth (even though 80% of $730,000 is $584,000, not $540,000). A source familiar with the complaint said Parks and Maddox were told the balance of the $44,000 went to fees and to cover some expenses with the property.

Maddox and Parks signed the settlement sheet and obligated themselves to repay Alabama One $540,000, and when after a few months they could not make the payments, Ewing advised them to file for bankruptcy, the complaint alleged.

After Butler's indictment and imprisonment, Parks and Maddox recounted in the complaint how they investigated their own loan and determined that the appraisal that had been used to price the property had been based on false information. They also alleged that the same appraiser had performed other appraisals in Alabama One loans involving Butler, almost all of which carried significantly exaggerated values.  Even though Ewing had confidently told them the appraiser could be trusted.

"Ms. Watson was employed by Tammy Ewing," Parks and Maddox wrote in the complaint. "Tammy Ewing assured all three parties that the appraisal was accurate as Ms. Watson was very qualified and did appraisals for Alabama One and a number of recognizable businesses and individuals in Tuscaloosa."

When Parks and Maddox finally received some of the documentation used in their own loan file, they charged in the complaint, they were shocked to discover falsified documents that made American Auto Sales LLC, their one-day corporation, appear to have been in business for months and grossed thousands of dollars in income.

The pair also charged they have calculated that the property had been appraised for two to three times its actual value and that the purpose of the appraisal was to funnel more money to Butler.

According to county and court records that a source researched, Butler purchased the property in 2005 for $450,000 with a mortgage from Merchant and Farmers Bank, which has a branch in Tuscaloosa. 

The same source also reported county records showed Butler had carried a second mortgage on the same property for almost $1 million ($999,500). Both this loan and the loan from Farmers and Merchants were marked as paid, but it was unclear, the source said, when they had been recorded as paid. Research had not yet uncovered the appraisal that was used to justify the almost $1 million loan, the source reported.

The source also observed that, just as in Ricky Turner's legal complaint from last week, Parks and Maddox have recounted how the papers had been waiting for their signatures when they arrived in Ewing's office and how they had not been given copies of the documents to take with them.

Read more: Inflated appraisals may have played a role in another million dollar mortgage…

In a related matter, research has discovered that the $4.1 million mortgage that Alabama One has on Danny Butler's home may also have been originated on the basis of an inflated appraisal.

Butler lived on a 108-acre piece of property in Fosters, Ala., in a home with a reportedly large garage, metal shop and entertainment area. The property was appraised in September 2012 for $3.635 million by W. "Dick" Holley of West Alabama Appraisal, a Tuscaloosa appraisal firm Alabama One has used for years in its residential mortgage business. 

Alabama One was left holding the $4.1 million note when Butler filed for bankruptcy, according to court records.

Holley valued the land at $19,034 per acre and the house, building and other improvements at more than $1.57 million.

Just over 25 months later, David Burns, an appraiser with Southeast Appraisals, Inc., a Northport, Ala. appraisal firm, appraised the same land and buildings at just over $1.1 million. Burns set the land value at $10,668 per acre and the buildings and improvements at $758,000.

West Alabama Appraisal did not return a call for comment as of press time.

Neva Conway, legal counsel to the Alabama Board of Realtors in Montgomery, Ala., explained the board requires a mix of classroom instruction, apprenticeship and continuing education to get and keep an appraiser's license, and that the board relies on a complaint system to regulate appraisers.

"We don't have the power to go out and check into what appraisers are doing or ask to see their files or anything like that," Conway said, adding that a complaint will trigger an investigation, but that complaints over the last two years had dropped off dramatically.

Previously, the board might have received between 90 and 100 complaints per year, Conway said, but in 2013 and 2014 the number of complaints had fallen to less than 50 per year.