Chief Judge James Gritzner of the U.S. District Court has approved applying $9,800 that was seized during the investigation of an arson fire at the former residence of developer John Kline toward the nearly $1.2 million he was ordered to pay in a bank fraud case.

Kline was sentenced to 2 1/2 years in federal prison and ordered to pay $1.16 million in restitution in April after pleading guilty to two counts of bank fraud. According to court records, Kline has paid $200.

Cash was recovered from a safe in Kline's million-dollar residence at 3536 129th St. in Urbandale after it burned to the ground in an arson fire in February 2009. No charges have been filed. The U.S. attorney's office asked the court apply a $500 bill and another $9,300 toward the restitution, which is owed to lenders.

A development company managed by Greater Des Moines home builders Scott and Stephanie Denton bought the property at sheriff's sale in May for $750,000.

Kline was indicted in November 2011 with business partner Randal Walters on bank and wire fraud charges. Prosecutors said they illegally used real estate development loans to prop up the finances of other struggling companies.

Walters was sentenced to serve one year and one day in federal prison and ordered to pay $500,000 in restitution. Click here for a related story in the Business Record.