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Developer James Myers should be accountable for a private loan that has gone unpaid for more than 18 months, according to a filing in the former Regency principal’s $184 million bankruptcy case.

Steven and Gayle Nichols and their trust accuse Myers of failing to account for a $1.5 million loan to an investment company in which he had an interest. Their filing seeks to stop Myers from having the debt discharged along with other business debts.

Myers filed for protection under Chapter 7 of federal bankruptcy laws in October 2009, slightly more than a year after Regency development companies went out of business in the face of mounting debts and declining cash flow.

When it closed, Regency was the largest home builder in the state. However, the company and its related companies also were stretched thin due to land developments across Iowa and in other states.

The Nichols claim in their complaint that they obtained a promissory note in December 2006 from Westwood Partners LC for repayment of the loan. Myers had an interest in the company along with his brother, Robert, who signed the promissory note, which was due in June 2007.

They claim that immediately after obtaining the loan, James Myers distributed the money to other entities he controlled, thereby defrauding the Nicholses, who said they believed the money was needed for projects controlled by Westwood.

The Nicholses say in the court filing that they are owed $874,202.

The couple and their trust also have filed a lawsuit in Polk County District Court seeking repayment of the loan.

This is the second time that former investment partners have accused Myers of fraud. A finding of fraud is one the few ways to block a debt from being forgiven or repaid at a reduced rate under a Chapter 7 bankruptcy.

Buyers of interests in a Minneapolis condominium development claim that Myers committed fraud under Minnesota securities laws by inducing them, via other partners, to purchase shares in the project.

Myers has denied direct involvement in distribution of shares in the development, which has been the target of several lawsuits.

Steve Wandro, Myers’ attorney in the bankruptcy case, said the Nichols claim is without merit.

“We just don’t get it,” he said.

Wandro said he is surprised that the Myers bankruptcy filing has generated little controversy among former creditors.

“For a bankruptcy of this size, which, to my knowledge, is the largest individual bankruptcy that’s ever been filed in the history of the state of Iowa, it’s been pretty quiet,” he said.

The bankruptcy filing lists 39 state lawsuits that have been filed against Myers and development companies in which he has an interest over unpaid loans.