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Indicted developer faces jail time in divorce case

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Developer John Kline, facing trail on federal bank and wire fraud charges, also faces 30 days in the Marion County Jail unless he pays a $221,897 court order by May 14.

Kline, set to stand trial Sept. 10 along with development partner Randal Walters on the federal charges, owes what amounts to a down payment on a $2.8 million property settlement in his 2004 divorce from Phyllis Kline.

In a ruling late last month, Marion County Judge Paul Huscher ordered John Kline to pay $180,000 on the property settlement, $41,897 toward attorney fees Phyllis Kline paid to defend herself in foreclosure lawsuits against her ex-husband that resulted from failed development deals, as well as $750 in attorney’s fees. To avoid jail time, those payments must be made by May 14.

Huscher also said that Kline was in arrears on $73,500 in child support payments. John and Phyllis Kline have two children. Kline is required to pay $1,000 a month on court-ordered child support payments of $6,500 a month.

In the federal case, Kline and Walters are accused of diverting bank loans intended for specific projects to other businesses and for their personal use. The government said 13 banks lost nearly $4 million over a 38-month period from 2004 to 2007.

 

Kline and his wife, Michelle, also are embroiled in a Polk County lawsuit in which a contractor is attempting to collect a $100,000 insurance settlement on an arson fire that destroyed the Klines’ million-dollar Urbandale residence in February 2009.