Return Expected of Fraud Suspect Found in Panama

A man who was charged by a federal grand jury in a $5.25-million fraud case is expected to be returned to San Diego this week after his arrest in a Panama City bar.

FBI spokesman Jim Bolenbach said Peter Anthony Barron, 48, was arrested Wednesday and promptly put on a commercial flight to Miami, where he was taken into custody by FBI agents.

Barron and an accomplice, Robert K. Burdette, 48, were accused in a 28-count indictment that was unsealed by U.S prosecutors Feb. 5. The two men are charged with defrauding the First South Federal Savings & Loan of Pine Bluff, Ark., by obtaining a $5.25-million loan for a condominium project near Escondido that never materialized.

According to federal authorities, Burdette was hired as a civil engineer for the phony project and verified to the Arkansas bank work that was never done.

Burdette surrendered to U.S. authorities Feb. 4, but Barron remained a fugitive until his arrest. Bolenbach said First South Federal had approved a $5.25-million loan to Barron but had distributed only about $2 million when the financial institution was forced to close Dec. 5.

Bolenbach said the First South Federal’s closure was precipitated by the $2 million loss. Officials from the Federal Savings & Loan Corp. said it was the largest financial collapse of a federal savings and loan institution in U.S. history.