Fulton Financial's subsidiary in Virginia is tangled in a legal dispute over the defection of nearly all of its mortgage company staff to a rival lender, according to published reports.

In the process, the departing employees allegedly took boxes of confidential customer and prospect information, which the subsidiary says caused it irreparable harm.

The subsidiary, Resource Bank, is seeking $15 million from rival Monarch Bank and 14 new employees of its Monarch Mortgage unit. All of the new workers left Resource Bank's mortgage unit, Resource Mortgage.

If Resource's allegations are proven, and the court finds those allegations fall within the Virginia Business Conspiracy Act, the damages could be tripled to $45 million.

The defendants include former Resource Mortgage president Ted Yoder and former chief operating officer William Morrison, reported Inside Business, a Norfolk-based weekly newspaper.

Monarch denies any wrongdoing over the exodus last month. It said the executives contacted Monarch without any solicitation by Monarch and expressed an interest in being hired.

The other employees, said Monarch, responded to a classified ad that ran for one day in a Norfolk newspaper.

Resource Bank filed its action in Norfolk Circuit Court on June 11, three days after Yoder and Morrison sued Resource Bank for back pay they said they are owed.

In total, more than 70 employees left Resource Mortgage for Monarch Mortgage, reported Inside Business.

The two executives are accused of orchestrating the mass defection in violation of their employment agreements with their former employer.

The agreements say if the executives leave Resource Mortgage, they are barred for a year from recruiting any Resource Mortgage employees, said Inside Business.

Lancaster-based Fulton Financial bought Resource Bank, based in Virginia Beach, in 2004 for $213.5 million in stock.

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