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EDA Finance Committee scrutinizes FY-22 Budget proposal, dynamics



Friday morning, July 9, the Finance Committee of the Warren County Economic Development Authority met to discuss the EDA’s Fiscal Year-2022 Budget proposal. In addition to Committee Chairman Jim Wolfe and members Jorie Martin and Tom Patteson, present for the in-person meeting at the EDA’s Kendrick Lane Office were EDA Board Chairman Jeff Browne, Executive Director Doug Parsons, Administrative Assistant Gretchen Henderson, and County Board of Supervisors Chair Cheryl Cullers.

From left, Tom Patteson, Jim Wolfe, Jeff Browne, Doug Parsons, Jorie Martin, and Cheryl Cullers were back in the EDA in-person meeting format Friday morning. Royal Examiner Photos by Roger Bianchini

The County Board of Supervisors holds the purse strings for the EDA, as the new EDA board and staff continue to navigate the financial and legal aftermath of the $26-million-dollar-plus financial scandal uncovered during the administrative leadership of former EDA Executive Director Jennifer McDonald and a previous EDA Board of Directors.

How the financial consequences of that yet-to-be resolved civilly or criminally alleged misuse, embezzlement or fraudulent acquisition of EDA resources continues to impact the retooled EDA was a topic of interest during the committee meeting. As annual debt service revenues from property rentals and loan paybacks versus loan debt service expenses were discussed in a second phase of the budget review, that point was made quite pointedly after a debt service revenue deficit of $704,700 was noted.

“Let’s make this clear for the public,” Committee Chairman Wolfe injected with a glance the media’s way, continuing, “So, there are three (primary) figures on the page … there is the $220,000 General Fund Operating Allocation. And the way to think about it is as a matter of public policy the County says, ‘economic development is a good idea, let’s put some money toward that kind of development’.

“There’s another operating supplement of … $39,200.

“And because of all the debts of prior activities, there’s another roughly $700,000 in unfunded debt payments because of past transactions. Those don’t have anything to do with current economic development or moving forward. That’s trying to clean up after the other ones. – Did I misstate that in any way?” Wolfe concluded with a question for his EDA colleagues.

EDA Finance Committee Chairman Jim Wolfe wanted to make it perfectly clear where the EDA’s debt service-revenue deficit originates – in the past under different leadership.

Rather than a correction, Executive Director Doug Parsons elaborated on Wolfe’s observation with added detail on how the deficit numbers broke down between inherited debt versus that acquired by the new EDA – the short answer being all six of current EDA loans with a total annual debt service of about $1.5 million were inherited and none acquired by the retooled EDA board and staff.

During the committee meeting Parson also pointed to a $658,000 General Fund Cap number plugged in by the county administrator that could be adjusted upwards to help cover that $704,700 debt service shortfall. The shortfall was created by the difference in the $1,556,700 annual debt service of the six inherited EDA loans and the $852,000 of Offsetting annual revenue from the Baugh Drive Warehouse rent ($345,600) and the ITFederal Loan payback ($506,400).

The ITFederal loan Albatross – while it generates $506,400 of annual payback revenue, the EDA operates at an annual deficit of $90,900 as it pays a higher interest rate and $597,300 annually on its bank loan to finance the project. And did anyone ever figure out why a previous EDA board okayed a $10-million loan to ITFederal of which only about $2 million had to be spent on its ‘free’ 30-acre Avtex site project? OH, the other $8 million to the Criminal Justice Academy project – you got that in writing, right?

Operations and the Future

In the first phase of discussion it was the Operational Budget under scrutiny as the new EDA board and staff continues to move forward with economic development in the community, while still traversing the legal and civil liability minefield of the financial scandal referenced above. A 28-line-item FY-22 Operational Budget totaling $367,100 was brought to the table.

Major areas of concern discussed included “Marketing” of the community to potential businesses seeking a favorable geographic and social environment; “Maintenance” of EDA properties – variables and potential HVAC costs at Baugh Drive and the EDA office complex were put on the table; “Legal” and “Auditing” fees; “Insurance” including, not only “Property Insurance”, but also “Professional Liability” insurance; the impact of a 2.5% Cost Of Living Act (COLA) increase on staff salaries; and continued efforts on community education to limit and reverse the spread of the Spotted Lanternfly in the county.

Wolfe observed from his experience that marketing was often a first budget line item to be reduced during tight economic times, but added that “it should be the last”. A $10,000 “Marketing” request was reduced to $4,300 by the County Administration. While the importance of advertising was agreed upon, its type and context to achieve maximum positive exposure and result remains an issue the EDA Board has devoted some discussion to recently. How that may translate into a final number submission remains to be seen.

A $10,000 “Maintenance” request was unaltered by the County. However, with looming HVAC maintenance or replacement issues at several locations, the potential need of more than the originally submitted amount was noted.

Well, only the occupied parts will need HVAC work in the immediate future – at the EDA Office complex or other properties.

Legal, Auditing & Insurance variables

Legal fees were listed at $84,000 – pared back from a $96,000 request – and auditor fees at $17,500. It was explained the $17,500 was for one fiscal year’s audit. But the advantage of seeking both the FY-2020 and FY-2021 audits in the coming budget year was broached to catch the EDA up with the County in the auditing process. This past year the EDA went through a lengthy, soon-to-be finalized by the firm of Brown-Edwards, audit of the FY-2018 and FY-2019 budget years when alleged embezzlements and other financial misappropriations were occurring.

Of the coming-year audits beginning with FY-2020, Parsons commented: “They will be drastically more simple than 2018 and 2019 because we were all here” throughout those years’ budget and operational processes.

It was noted that while the EDA must put the FY-2020-and-21 audit services out to bid, due to their experience here through more trying budget cycles it seemed a longshot that Browne-Edwards would not get the call back.

On the insurance front, $10,000 was listed for “Property Insurance” and $400 for “Professionally Liability Insurance”. With the EDA having received a $500,000 “Liability” payoff from current carrier Cincinnati Insurance, the potential of a bidding war to pick up the Warren County EDA’s liability coverage seems slim.

“I’ve been working on this for nine months and nobody will touch us,” Martin told her colleagues of interest from other companies. The advisability of sticking with Cincinnati if possible, but changing local agent Stoneburner-Carter due to proprietor Tony Carter’s current and past seat on the Warren County Board of Supervisors, was broached.

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McDonald Defense Counsel Renews Motions, Including for a New Trial, as Feb. 12 Sentencing Date Looms



Federal officials in Harrisonburg have verified that defense counsel for former Front Royal-Warren County Economic Development Authority Executive Director Jennifer McDonald has filed renewed motions seeking a new trial for their client, as well as the overturning of several of the 34 guilty verdicts a federal jury of six men and six women in Harrisonburg delivered on November 1. Verdicts being sought to be overturned include several counts of bank fraud and one of aggravated identity theft. The latter of those charges involves the use of ITFederal principal Truc “Curt” Tran’s name in promoting one of the real estate transactions McDonald was convicted of using to misdirect money to her personal benefit or that of others under the guise of conducting FR-WC EDA related business. Attempts to reach defense counsel about their filing were unsuccessful as of publication.

The defense team outside the Harrisonburg federal courthouse, along with others evacuated during an apparent false alarm fire warning at the courthouse as the trial wore towards a conclusion in late October. Below, May 2019 mug shot of McDonald following one of her initial arrests on criminal charges originally brought at the local level. She has remained free on bond or home incarceration for the majority of time since those spring 2019 arrests, and remains free pending Feb. 12 sentencing or a ruling for a new trial.

The defense has submitted its motions, similar to ones denied by Judge Elizabeth K. Dillon at trial, as the sentencing of McDonald, set for 10 a.m., Monday, February 12, 2024, looms over their client, who remains free on bond. The defense motions reiterate points made by federal Public Defenders Office attorneys Andrea Harris and Abigail Thibeault at trial and in closing arguments delivered October 31. The three defense witnesses called on that final day of the trial appeared to be presented in an attempt to discredit some of the 67 witnesses called by the prosecution in the trial that began on August 21 and ended on November 30, following several delays of a week to several weeks due to a need to suspend or reschedule the trial because of medically verified illnesses or issues of involved parties, on several occasions defendant McDonald.

The new motions, like those rejected at trial, focus on the defense’s central contention that McDonald and the FR-WC EDA had entered into a secret agreement behind closed doors to pay McDonald $5 million or more in exchange for her not filing a sexual harassment or assault lawsuit against local government officials over actions she alleges during her tenure as FR-EDA executive director. The lone signature on a defense exhibit submitted in support of this scenario belonged to former FR-WC EDA Board Chair Patty Wines, who was by then several years deceased. The prosecution asserted the signature was a forgery. Other EDA officials called by the prosecution, including board member Ron Llewellyn, also unhappily called as one of the defense witnesses on October 31, denied any knowledge of the existence of such a document. It was noted during trial testimony that such a document could not have been approved without a full vote of the EDA Board of Directors.

Jennifer McDonald, right, and then FR-WC EDA Board Chair Patty Wines on the job during earlier days.

The defense motion for a new trial centers on the asserted exclusion of evidence related to the alleged sexual harassment secret agreement. Arguments about the exclusion of a transcript of grand jury testimony given by someone with alleged knowledge of the secret agreement or the absence of that person being called as a witness at trial appear to be at the center of the mistrial/new trial motion. There is also an objection to a related jury instruction given by Judge Dillon, noting that the prosecution didn’t have to produce every piece of evidence or potential witness related to the case at trial.

According to the federal 10th Western District of Virginia website, thus far a hearing date on the new defense motions has not been set for the Harrisonburg federal courtroom.

It appears the Harrisonburg federal courthouse may have another hearing related to the Jennifer McDonald cases prior to the scheduled Feb. 12, 2024, sentencing hearing on her currently standing 34 white-color crime convictions.

McDonald was accused of diverting as much as $ 6.5 million of EDA assets to her direct personal benefit out of an estimated $26 million alleged to have been moved under false pretenses during a four-year period (2014-2018) of her executive leadership of the FR-WC EDA. Part of that larger total, a $10-million loan with additional developmental expenses estimated at as much as $2 million, was approved in support of Tran’s ITFederal company’s development plan earmarked for 30 acres of the 148-acre Royal Phoenix Business Park property in Front Royal at the former Avtex federal Superfund site. EDA officials and civil cases attorneys assert that a $10-million loan and subsequent addition of developmental expenses were achieved under false pretenses as to Tran’s ability to achieve his submitted developmental plan. However, at the time some of these McDonald-involved real estate transactions were occurring, between 2016 and 2018, information was being circulated that Tran was planning to invest in other business opportunities at other locations in the county. Tran has said such investments were discussed but never finalized and never signed on to by him.

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Town Announces Withdrawal of its Civil Litigation Against the FR-WC EDA



At 2:12 p.m., Wednesday, November 15, the Front Royal Town Council Clerk’s office issued a press release announcing the dropping of the Town’s civil litigation against the Front Royal-Warren County Economic Development Authority (EDA, FR-WC EDA). The release portrays the withdrawn litigation as a good faith effort to reduce EDA “financial scandal”-related legal expenses ultimately falling on the shoulders of town and county taxpaying citizens. The fifth paragraph of the six-paragraph release, opening with a reference to former EDA Executive Director Jennifer McDonald, recently convicted on 34 criminal counts related to the EDA “financial scandal” in the 10th Western District of Virginia federal court, reads:

“The legal proceedings flowing from McDonald’s misdeeds have been ongoing for several years. The local community, as both town residents and county taxpayers, has already shouldered substantial legal costs. In order to prevent further financial strain on the citizens and in recognition of the actual amounts remaining in dispute between the Town of Front Royal and the EDA, the Town of Front Royal has decided to non-suit its lawsuit against the EDA. This move is intended to save public funds and reflects our commitment to the community’s welfare. We hope this gesture will be met with a similar commitment from the EDA.”

It might be noted that after the Town filed its civil litigation against and withdrew from future involvement with the jointly created EDA, the now unilaterally County-overseen EDA filed a countersuit, citing financial obligations of the Town related to the EDA “financial scandal” and projects, including funding the construction of a new town police station, done on behalf of the Town during that time-frame.

One familiar with the dueling litigations and a portion of the Town’s justification framed around the fact that town officials no longer appointed EDA board members (a voluntarily given up authority*), thus had no EDA oversight responsibilities, might wonder if a reassessment of the strength or weakness of Town’s legal position in the now-abandoned litigation might have also factored into the decision to abandon the civil suit.

But whatever the driving factor, let’s celebrate what seems a positive move toward improved County-Town relations.

Click here to read the Town of Front Royal Press Release.

* FOOTNOTE: The Town-County compromise on withdrawing the Town’s responsibility for EDA operational funding may be recalled as part of the effort to end the double-taxation of town citizens for joint Town-County operations, since town citizens are also county citizens and ended up paying taxes twice for jointly overseen operations. The EDA funding agreement was part of a move that put operational funding of jointly beneficial operations totally on the County side. As we recall, other departments where similar agreements were reached to stop town citizens from being double taxed included Fire & Rescue, Parks & Recreation, and Samuels Public Library.

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McDonald Found Guilty on All 34 Criminal Counts in EDA ‘Financial Scandal’ Prosecution



Just after 1 p.m. on Wednesday, November 1, slightly over four hours after beginning deliberations on the 34 criminal counts against former Front Royal-Warren County Economic Development Authority Executive Director Jennifer Rae McDonald regarding allegedly embezzled or misdirected EDA assets, the six-man, six-woman 10th Western District of Virginia federal jury returned guilty verdicts on all 34 counts. McDonald and her two federal court-appointed attorneys sat quietly at the defense table as each charge, and each verdict was read into the court record consecutively by a court clerk.

Over the objection of lead prosecutor Sean Welsh, Judge Elizabeth K. Dillon allowed McDonald to remain free on bond under the existing guidelines under which she has been free since the 34 federal criminal indictments were handed down by a federal grand jury on August 25, 2021. As has been reported, federal prosecutors inherited the case from two state prosecutors offices, Warren County (recusal due to staff work familiarity with some defendants) and Rockingham County (complexity, time involvement). After her arrests at the state level in mid-2019, McDonald was also free on bond or home arrest for the bulk of the time since she was initially charged at the state level.

Judge Dillon cautioned McDonald, as she said she would any defendant, against violating the terms of her bond, including showing up for her sentencing hearing at an as-yet undetermined point of time, or risk facing additional criminal charges carrying as much as 10 years imprisonment and $250,000 in fines. The judge noted a common 90-day time-frame between conviction and sentencing. She gave the defense 30 days to file any post-conviction motions.

File photo of former EDA Executive Director Jennifer McDonald, circa 2012, in a playful mood with, from left, former Town Engineer/Manager Steve Burke, County Attorney Doug Napier, and Town Attorney Blair Mitchell. Royal Examiner File Photos Roger Bianchini

In challenging the continuation of McDonald’s bond, prosecutor Welsh pointed to conflicting stories told by two of the defense witnesses the previous day as an indicator the defendant was continuing a pattern of deception to the court to justify her actions in moving EDA assets she now stands convicted of moving fraudulently. Those witnesses were former prosecution witness and former EDA Board of Directors member Ron Llewellyn, and former post-EDA financial scandal-era McDonald employer Justin Simmons. They told conflicting stories about an incident the defense asserts happened this October 22, involving McDonald and Simmons encountering Llewellyn at a church parking lot, leading to an unpleasant verbal exchange. Llewellyn denied the encounter occurred, citing that he was out of town that day at a football game in Salem. The prosecutor asserted certain evidence about a law enforcement search of McDonald’s home property when she wasn’t there and descriptions of her state of mind from a live-stream viewing of it on her phone indicated the church parking lot incident could not have occurred that day.

Defense counsel Andrea Harris countered that the incident time-frames were not mutually exclusive of both possibly having occurred. She said there was no evidence her client posed a threat to her community or to herself, and asserted that her track record of compliance with bond conditions and court appearances with all the charges facing her, indicated she was not a flight risk.

Judge Elizabeth Dillon cautioned defendant Jennifer McDonald not to violate the ongoing conditions of her bond as she awaits a sentencing hearing on her 34 convictions in federal court on Wednesday. Or she could face an additional decade in prison and $250,000 in fines, the judge warned.

In the wake of defense counsel Harris recounting McDonald’s track record of appearing for scheduled hearing and trial dates, other than when she was being treated medically, as noted above Judge Dillon extended McDonald’s bond conditions pending sentencing.

As previously reported, after inheriting the case from two state prosecutors offices, Warren County (recusal due to staff work familiarity with some defendants) and Rockingham County (complexity, time involvement), on August 25, 2021, a 10th Western District of Virginia Federal Grand Jury handed down 34 federal criminal indictments against McDonald on charges including bank fraud (10 counts), wire fraud (7), aggravated identity theft (1), and money laundering (16). While total EDA “financial scandal” losses have been estimated at $26-million, including $12 million in the ITFederal loan and related EDA investment, evidence presented at trial indicated McDonald moved over $5 million, perhaps as much as $6.5 million, to her personal benefit. She was initially arrested and charged criminally at the state level in mid-2019.

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After a Spooky Courthouse Halloween McDonald Criminal Trial Goes to the Jury



After over four hours of closing arguments (prosecution 2:33; defense 1:32; prosecution rebuttal:21-minutes) in the wake of presentation of the defense case in less than an hour with the calling of just three witnesses, the 34-count federal criminal case against former Front Royal-Warren County Economic Development Authority Executive Director Jennifer McDonald went to the jury at 5:45 p.m. Tuesday afternoon, October 31.

But that wasn’t until after court was delayed for nearly a half hour by an alarm and recorded message: “Fire Emergency reported in the building. Please evacuate the building by the nearest exit. Do not use the elevators,” that went off repetitively for nearly a half hour after beginning at 4:45 p.m. To our knowledge, Fire and Rescue first responders found no fire in the building this Halloween day. But it was a pretty spooky interlude on the final day of the off-again, on-again trial that began on August 21 and saw two delays, the second one of a month, due to various involved party health issues.

First responders may have been as puzzled as building occupants who evacuated as told despite no signs of the ‘fire emergency’ they were told was reported in the building. Royal Examiner Photos Roger Bianchini

Perhaps the most interesting legal development of the day was defense counsel Abigail Thibeault’s closing argument focus on what the prosecution had dismissed as one of the more unbelievable defendant explanations of her movement of EDA money to her own use. That was the defense-alleged secret “Voluntary Settlement Agreement” between the EDA Board of Directors and McDonald to assure her silence and non-suit over what she claimed were sexual harassment and sexual assaults by County officials, including former County Administrator Doug Stanley, among other high-profile local officials. The price of that silence was an alleged $6.5 million the defense contends was agreed to be secretly paid to McDonald, thus explaining some of the movements of EDA assets to her own use that the prosecution presented as evidence of fraud and criminal misdirection of EDA money.

“This is about sexual assault … This story is much bigger” than what the prosecution had presented to them, Thibeault told the jury of the notion that an economically and sexually privileged, male-dominated county elite had set McDonald up to take a fall for challenging their dominance.

During closing arguments, the defense contended their client actually did have significant Hollywood Casino slot machine winnings, evidence of which the prosecution and its investigative teams downplayed. Below, boys will be boys? Jennifer McDonald on the job prior to her December 20, 2018 resignation among escalating questions about her movement of EDA assets into personal uses. The defense contended in closing arguments that McDonald is the victim of a predatory male elite in Warren County and that, in the end, the EDA board became a tool of that elite.

Lead prosecutor Sean Welsh countered Thibeault’s assertions in rebuttal, telling the jury the Voluntary Settlement Agreement theory was countered by multiple pieces of evidence the prosecution had presented to them. He pointed to other prosecution witness-testified false allegations McDonald is alleged to have made to explain some of her financial transfers to achieve real estate and other transactions. Among those were Larry Tuttle’s alleged financing of several McDonald/Da Boyz LLC real estate deals he testified he had no financial assets to accomplish. Why lie about such things if there was a simple explanation, such as the EDA Board of Directors authorizing the transfer of assets to McDonald? Welsh asked the jury.

The defense team and defendant, among others, wait for the all-clear to re-enter the federal courthouse in Harrisonburg Tuesday afternoon around 5 p.m. after a ‘fire emergency’ announcement cleared the building on Halloween Day.

After the 10th Western District of Virginia federal courthouse building was evacuated and cleared of any fire and the prosecution’s closing rebuttal was completed, a final round of procedural instructions from Judge Elizabeth K. Dillon was given to the jury. The jury was then sent out to select a foreman and determine whether they wanted to begin deliberations immediately or return the following day. After 10 minutes, the court was informed the jury had decided to return on Wednesday to begin the final chapter of this trial. Questioned about a preferred starting time by the judge, they opted for a 9 a.m. start Wednesday morning.

As previously reported, after inheriting the case from two state prosecutors offices, Warren County (recusal due to staff work familiarity with some defendants) and Rockingham County (complexity, time involvement), on August 25, 2021, a 10th Western District of Virginia Federal Grand Jury handed down 34 federal criminal indictments against McDonald on charges including bank fraud, wire fraud, aggravated identity theft, and money laundering. Those charges are related to the alleged misdirection of an estimated $ 26 million in municipal and EDA assets to personal use and enrichment of McDonald and alleged co-conspirators.

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Judge Denies ‘Renewed’ McDonald Defense Mistrial Motion – Defense Case to Open Tuesday, October 31



Following a closed evidentiary hearing Thursday afternoon, October 27, Judge Elizabeth K. Dillon denied a “renewed” defense motion for a mistrial due to repeated delays in the federal criminal prosecution of former Front Royal-Warren County Economic Development Authority Executive Director Jennifer Rae McDonald. The defense initially called for a mistrial on September 26. While taking that motion under advisement, Judge Dillon expressed a preference for the alternative of “briefly suspending the trial” to accommodate apparent health issues with the defendant and resuming it as an alternative to a mistrial. The trial is now scheduled to resume at 8 a.m. Tuesday morning, October 31, with the anticipated opening of the defense case. November 1 has also been set aside to accommodate the defense presentation, any motions, closing arguments, and jury instructions before the case is handed over to the jury for deliberations.

The scheduled start of what is expected to be a brief defense presentation, perhaps taking less than a full day with three or less witnesses being called, was again delayed on Friday, October 27. The scheduled 10th Western District of Virginia federal court starting time of 8:30 a.m. was adjusted late Thursday to a 3 p.m. Friday start. And shortly after that late Friday start and the beginning of the remote connection of several witnesses to be called during the hearing, Judge Dillon asked if either counsel wanted to request that the hearing be closed to the public.

Tuesday and Wednesday, October 31 and November 1, have been set aside for the conclusion of the criminal trial of Jennifer McDonald at the federal courthouse in Harrisonburg, Va. – Royal Examiner File Photo Roger Bianchini

“Yes, your honor,” was the reply from the court-appointed defense team of Andrea Harris and Abigail Thibeault. It might be noted that defendant McDonald was again not present at the defense table, as she had not been after lunch break the previous day. A clue as to that absence and the defense request for a closed hearing may have been heard during the beginning of the remote witness connection process. One of those witnesses was referred to as “doctor” and a comment concerning “the name of the patient you’ll be discussing” was made. According to the PACER court website, a total of five people testified during the closed hearing of October 27, all of them cited as doctors: “1. Dr. Miklos Szentirmai – via Zoom 2. Dr. David Saenz – via Zoom 3. Dr. John Craig Henry – via Zoom 4. Dr. Anne Bagley 5. Dr. Melanie Matson – via Zoom …”

As noted in yesterday’s story on the closing of the prosecution case and delay in opening the defense case, defense counsel told the court that their client had a cardiac pacemaker installed recently in the wake of health issues leading to a recurring elevated heart rate and blood pressure that led to a delay of a month, Sept. 26 to Oct. 26, in the trial.

File photo of Jennifer McDonald following one of her arrests at the state level in July 2019. Following one of those arrests, McDonald was transported for medical care believed related to elevated heart rate and blood pressure issues that have seemingly recurred during this trial.

As previously reported, after inheriting the case from two state prosecutors’ offices, Warren County (recusal due to staff work familiarity with some defendants) and Rockingham County (complexity, time involvement), on August 25, 2021, a 10th Western District of Virginia Federal Grand Jury handed down 34 federal criminal indictments against Jennifer McDonald on charges including bank fraud, wire fraud, money laundering, and aggravated identity theft. Those charges are related to the alleged misdirection of an estimated $ 26 million in municipal and EDA assets to personal use and enrichment of McDonald and alleged co-conspirators. The latter are yet to be indicted criminally at the federal level, likely due to speedy trial issues. A number of alleged co-conspirators were charged criminally at the state level, with charges then dropped by Warren County prosecutors to prevent defense motions for dismissal due to looming speedy trial statute violations. The case has been defined as “complex” due to the amount of evidentiary material involved, cited at well over a million pages of doc

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Prosecution Rests in McDonald Trial – Recent Health Procedure of Defendant Revealed as Start of Defense Case Delayed After Lunch Break



The prosecution in the federal criminal trial of former Front Royal-Warren County Economic Development Authority (FR-WC EDA, EDA) Executive Director Jennifer McDonald rested after the testimony of the final of its 57 witnesses Thursday morning, October 26. That witness was Kevin Nicholson, a Federal Bureau of Investigation (FBI) forensic accountant. In direct examination, Nicholson testified about the path of funds originating with the EDA to McDonald, as well as her husband Samuel North, that were used in a series of personal real estate and other transactions, including the paying off of various personal bills, as well as the use of ITFederal principal Truc “Curt” Tran’s name in one of those real estate transactions on property located at 2890 Buck Mountain Road.

During Monday’s hearing announcing the two-day delay of the trial to Thursday due to technical evidentiary issues, the prosecution had estimated Nicholson being on the stand for 90 minutes to two hours. After an hour and 20 minutes of direct examination tracing those multiple financial transactions the prosecution asserts were evidence of the various levels of fraud and the one aggravated identity theft charge involving Tran that McDonald is accused of, Nicholson was cross-examined for five minutes by the defense, with another two minutes of re-direct examination. During cross and re-direct examination defense and prosecution counsel sparred over the exclusion of some transactions in Nicholson’s chart references and the terminology of “loan” or “line of credit” used by Nicholson during his testimony. The defense also elicited an admission by Nicholson that he had worked with the prosecution in the assembly of some of the evidence presented in support of the prosecution’s case.

The lengthy and often delayed federal criminal trial of Jennifer McDonald related to the EDA ‘financial scandal’ seems to be winding down to a close at Harrisonburg’s federal courthouse – if the defendant’s health holds up. Royal Examiner File Photos Roger Bianchini

Following Nicholson’s hour and 20 minutes on the stand, the prosecution rested at 10:35 a.m. However, rather than moving directly to the opening of the defense case, the jury was dismissed as the defense filed motions for dismissal of several of the charges against their client as unproved by the prosecution evidence presented. Those dismissals involved several cases of bank and wire fraud, as well as the aggravated identity theft involving the use of Tran’s name in the Buck Mountain Road transaction. After an involved defense presentation, the prosecution argued against the standards cited by the defense, asserting that they had proved not only fraud but the use of Tran’s name to facilitate a real estate transaction they believe the bank would not have approved with only McDonald’s name attached to it.

Judge Elizabeth K. Dillon said she would need time to review some of the evidence cited in the dueling arguments, and she would reserve a decision on the defense motions for dismissal of some counts — 8 thru 10 and 14 thru 17 — “at this time.” Judge Dillon then asked if the defense was ready to present evidence in their case. This led to a brief consultation with their client, after which the defense team of Andria Harris and Abigail Thibeault asked for five minutes to consult with their client. At that point, at 10 minutes of noon, Judge Dillon called the jury back in and released them for lunch. Following the five-minute break, the judge noted that defense counsel had told her that McDonald would invoke her Fifth Amendment Constitutional right against self-incrimination, declining to testify. Judge Dillon then queried McDonald on her decision, asking if it was, in fact, her decision alone not to testify.

“Yes, mam,” McDonald responded.

The judge then overruled a prosecution objection to the calling or recalling of certain witnesses by the defense. Former EDA board member Ron Llewellyn, who had testified for the prosecution, was present in the hallway outside the courtroom as a potential defense witness. It was a situation he did not seem overly pleased about. However, Judge Dillon noted that the prosecution could object to certain lines of questioning during the disputed witness’s testimony.

Court then adjourned for lunch at 12:01 p.m. When court was reconvened at 1 p.m., the judge took both prosecution and defense counsel into chambers for discussion. The jury was brought in at 1:15 p.m. while the judge and counsel were still in chambers. Twenty minutes later, the judge and counsel returned to the courtroom. Judge Dillon then dismissed the jury, instructing them to return for an 8:30 a.m. start of the defense case the next day, adding that she anticipated the case being turned over to them for deliberations before the end of the day on Friday.

Ongoing health issues?

An unexpected piece of information was revealed by defense counsel shortly after court was convened Thursday morning at 8:30 a.m. That was that their client had recently “had a pacemaker installed” in the wake of her health issues that delayed the trial for a month, from September 26 to October 26. Those issues, according to sources, were a collapsed lung due to pneumonia and consequent raised heart rate and blood pressure that sent McDonald back to the hospital when the trial had been expected to resume in the last week of September.

McDonald was not in court with her counsel after the lunch break. One person present outside the third-floor courtroom after lunch said there had been word EMTs were present outside the courthouse. Attorneys on both sides of the aisle declined comment on whether EMTs had been summoned for the defendant. However, with her recent elevated blood pressure and heart rate issues, it might be noted that the courthouse elevator became un-operational early in the day on Thursday. While leaving for lunch break, McDonald had stepped aside to let several people following her to the stairs to pass, as she said it might take her a while to make it down. One might wonder how the long climb up those stairs after lunch might have impacted her health-wise, apparently not too long after having a pacemaker installed.

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Mountain View Music

National Media Services

Natural Results Chiropractic Clinic

No Doubt Accounting

Northwestern Community Services Board

Ole Timers Antiques

Penny Lane Hair Co.

Philip Vaught Real Estate Management

Phoenix Project

Reaching Out Now

Rotary Club of Warren County

Royal Blends Nutrition

Royal Cinemas

Royal Examiner

Royal Family Bowling Center

Royal Oak Bookshop

Royal Oak Computers

Royal Oak Bookshop

Royal Spice

Ruby Yoga

Salvation Army

Samuels Public Library

SaVida Health

Skyline Insurance

Shenandoah Shores Management Group

St. Luke Community Clinic

Strites Doughnuts

Studio Verde

The Arc of Warren County

The Institute for Association & Nonprofit Research

The Studio-A Place for Learning

The Valley Today - The River 95.3

The Vine and Leaf

Valley Chorale

Warren Charge (Bennett's Chapel, Limeton, Asbury)

Warren Coalition

Warren County Democratic Committee

Warren County Department of Social Services

Warren County DSS Job Development

Warrior Psychotherapy Services, PLLC

WCPS Work-Based Learning

What Matters & Beth Medved Waller, Inc Real Estate

White Picket Fence

Woodward House on Manor Grade

King Cartoons

Front Royal, VA
7:19 am4:50 pm EST
Feels like: 45°F
Wind: 0mph NNW
Humidity: 71%
Pressure: 30.17"Hg
UV index: 1
59°F / 34°F
43°F / 23°F
48°F / 28°F

Upcoming Events

8:00 am Breakfast with Santa @ Rivermont Volunteer Fire Department
Breakfast with Santa @ Rivermont Volunteer Fire Department
Dec 9 @ 8:00 am – 11:00 am
Breakfast with Santa @ Rivermont Volunteer Fire Department
Rivermont Volunteer Fire Department is having a Breakfast with Santa on Saturday, December 9th, from 8:00 a.m.- 11:00 a.m. Adults are $10.00 Kids are $5.00 Children 5 and under are free!
12:00 pm Christmas Lunch for Kids, Vets a... @ Front Royal Elks Lodge
Christmas Lunch for Kids, Vets a... @ Front Royal Elks Lodge
Dec 9 @ 12:00 pm – 4:00 pm
Christmas Lunch for Kids, Vets and Seniors @ Front Royal Elks Lodge
The Front Royal Elks Lodge will hold it’s annual Holiday Lunch for Kids, Veterans and Seniors on Saturday, December 9. Festivities will begin at 12 noon. Mr. and Mrs. Clause are said to be coming!
4:30 pm Astronomy for Everyone @ Sky Meadows State Park
Astronomy for Everyone @ Sky Meadows State Park
Dec 9 @ 4:30 pm – 7:30 pm
Astronomy for Everyone @ Sky Meadows State Park
Historic Area. Discover our International Dark-Sky Park! Our evenings begin with a half-hour children’s “Junior Astronomer” program, followed by a discussion about the importance of dark skies and light conservation. Then join NASA’s Jet Propulsion[...]
7:30 pm American Legion Community Band C... @ Boggs Chapel at R-MA
American Legion Community Band C... @ Boggs Chapel at R-MA
Dec 12 @ 7:30 pm – 9:30 pm
American Legion Community Band Christmas Concert @ Boggs Chapel at R-MA
The American Legion Community Band, located in Front Royal, Virginia, was formed in 1986 and has been playing concerts in the area ever since. The conductors and band members are all volunteer musicians from the local[...]
6:30 pm Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Dec 13 @ 6:30 pm – 9:30 pm
Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Bingo to support the American Cancer Society mission, organized by Relay For Life of Front Royal. Every Wednesday evening Early Bird Bingo at 6:30 p.m. Regular Bingo from 7-9:30 p.m. Food and refreshments available More[...]
7:00 am Pancake Breakfast @ Riverton United Methodist Church
Pancake Breakfast @ Riverton United Methodist Church
Dec 16 @ 7:00 am – 10:00 am
Pancake Breakfast @ Riverton United Methodist Church
Join us for pancakes, sausage, scrambled eggs, biscuits, sausage gravy, and juice/coffee! All are invited for this FREE event. Offering will be accepted.
10:00 am 10th Virginia Infantry Encampment @ Sky Meadows State Park
10th Virginia Infantry Encampment @ Sky Meadows State Park
Dec 16 @ 10:00 am – 4:00 pm
10th Virginia Infantry Encampment @ Sky Meadows State Park
Historic Area. Journey back in time and immerse yourself in the sights, sounds, and smells of a Civil War Encampment during the holidays. Interact with the 10th VA Infantry, also known as the Valley Guards,[...]
1:00 pm The Nutcracker @ Skyline High School
The Nutcracker @ Skyline High School
Dec 16 @ 1:00 pm – 5:00 pm
The Nutcracker @ Skyline High School
Italia Performing Arts is pleased to announce its own student production of The Nutcracker, a Christmas classic to be enjoyed by the whole family! When: Saturday, December 16th at 1:00 PM and 5:00 PM Where:[...]
10:00 am 10th Virginia Infantry Encampment @ Sky Meadows State Park
10th Virginia Infantry Encampment @ Sky Meadows State Park
Dec 17 @ 10:00 am – 2:00 pm
10th Virginia Infantry Encampment @ Sky Meadows State Park
Historic Area. Journey back in time and immerse yourself in the sights, sounds, and smells of a Civil War Encampment during the holidays. Interact with the 10th VA Infantry, also known as the Valley Guards,[...]