Sandberg allegedly told Dunton that she was looking into an outside agency to "puff up" the numbers so that the forecasts would be much higher and favorable for AEA, according to the lawsuit.

She also allegedly instructed Dunton not to meet with NCUA Chief Examiner Charles Stanley, and that if he did, Sandberg would consider it insubordination.

Because AEA is under NCUA special action, Stanley and his team would review the credit union's financial records and reports twice a year to make sure AEA was operating in a safe and sound manner, according to court documents. In December 2015, the NCUA released AEA from a five-year conservatorship to address its declining financial condition stemming from issues in its member business loan portfolio.

Michael Dunton

Even though Dunton allegedly told Stanley he could not meet with him, Stanley persisted in meeting with Dunton because he had the most knowledge of AEA's financial condition. During that meeting on Aug. 22, 2017, Stanley and Dunton discussed the financial projections for the rest of 2017 and 2018 and the both independently had similar financial projection numbers, according to the lawsuit.

The next day, Dunton was fired. He was offered a $6,500 severance as long as he signed a release and confidentiality agreement.

He did not sign the agreement and is now suing AEA for $475,000. Dunton claims the termination caused irreversible damage to his reputation and his ability to land a new job.

Last September, Dunton and his lawyer, mailed and emailed a letter to AEA's lawyer, John Garcia, which described the issue in detail, including the allegation that Dunton had been wrongfully terminated under state law.

The federal lawsuit, however, alleges that AEA also violated a federal law that prohibits credit unions from firing an employee for reporting a possible violation of a federal law or regulation.

"It is clear that the forecast for 2018 made by Mr. Dunton and Mr. Stanley, separately, would not be advantageous to Mrs. Sandberg and AEA," Dunton's lawyer, Ryan C. Hengl, wrote in a letter to Garcia. "It is also clear that, considering that Mr. Dunton was not going to participate in what can only be described as fraud, he was terminated by Mrs. Sandberg."

Garcia declined to comment on the letter.

He noted, however, that he was unaware of the federal lawsuit because he and the credit union had not been served a notice that a lawsuit had been filed against them. Indeed, the federal docket does not show that Garcia and AEAFCU had been served a notice that a lawsuit had been filed against them. However, when seeking comment from Sandberg, CU Times emailed a copy of the federal lawsuit to her.