A Bronxville man accuses Farm Credit East of age discrimination after the lender refused to loan him $ 1.2 million to buy and improve a former 53-acre winery in Calverton.
Ralph Ciuffetelli, now 76, claims he has been turned down four times on loan applications by Farm Credit East, despite his estimated net worth of over $ 12 million and despite operating a farm property of 23 acres in Yorktown, NY, according to the federal lawsuit he filed July 12 in US District Court.
In a denial letter, Farm Credit East said, “We do not grant credit to any applicants on the terms you request,” and said they “deny your loan application because there is insufficient income to pay off your debt. , and furthermore, you have not provided sufficient information regarding the use of funds and an acceptable business plan. ”
“It’s a little weird the way they do it,” said Andrew Campanelli, counsel for Mr. Ciuffetelli. “The purpose of Farm Credit East, and the reason it was created by Congress, was that it enabled those engaged in agriculture to obtain bad credit loans because the banks would not lend money. money to farmers, because if they have a bad year with the crops, they wouldn’t have the money.
The lawsuit also claims that Farm Credit East funds certain projects that are not agricultural, such as a car wash and an auto repair shop.
Farm Credit East is a farm credit system entity, which disburses funds under the Federal Farm Loan Act and falls under the jurisdiction of the Farm Credit Administration.
Mr Ciuffetelli is seeking $ 10 million in damages for age discrimination and violation of freedom of information law. He claims that Farm Credit East is an entity within the farm credit system, pays funds under the Federal Farm Loan Act, and is subject to the authority of the Farm Credit Administration, which is an independent agency of the federal government.
The lawsuit names Farm Credit East as defendants, as well as Patrick Wiles, a senior loan officer in its Riverhead office, and Sandra Pearson, a mortgage specialist in Long Island, Massachusetts and Connecticut.
At one point in the application process, Mr. Wiles asked Mr. Ciuffetelli questions such as “How old are you?” “What if you die?” and “Is the property in your name?” according to the lawsuit.
Mr. Wiles declined to comment.
Mr Ciuffetelli became interested in buying the land in 2016, when he was 73, the lawsuit says.
The estate consisted of a country house, vineyard and licensed vineyard and also had potential for other uses, such as an equestrian facility, nursery and hotel, according to the lawsuit.
Mr Ciuffetelli signed the contract to purchase the property for $ 1.2 million in February 2017 and currently lives at the Calverton site, according to the lawsuit.
The land in question, at 2822 River Road in Calverton, previously housed Hidden Vineyard. The house suffered extensive water damage and was being repaired, and the sellers – Peter DiBerardi’s estate – wanted the repairs done before signing the contract to sell the property, the lawsuit says.
Mr Ciuffetelli began exploring his options for a mortgage while work was in progress, the lawsuit said.
He said he had a long credit history and a perfect credit score.
Several banks told him that they did not have an agricultural program and that the land in question was in an agricultural district.
An agricultural district allows farm owners to enjoy benefits such as tax breaks in exchange for not developing the land for a certain number of years.
Mr. Ciuffetelli said he was unaware that the property was in an agricultural area and learned that Farm Credit East was his only option.
He eventually acquired a $ 500,000 bridging loan from Capital One Bank, at an interest rate of 9.5%, and paid the rest himself, while continuing to try to work with Farm Credit East to refinance the transaction at a lower interest rate.
Mr. Ciuffetelli eventually hired a lawyer to help him with his claim. This lawyer heard that other people found it easy to get loans from Farm Credit East, including one who had secured financing for a car wash and auto repair shop, “which is strange given that that Farm Credit East grant loans specifically for agriculture ”. trial said.
When attorney Richard Bartel attempted to obtain further information on this and other claimant, Farm Credit East attorney general Alena Gfeller told him that Farm Credit East was not covered by the Freedom of Information Act, which Mr. Ciuffetelli is disputing in the lawsuit.