In a work session following the Front Royal Town Council meeting of Monday, August 12, the format and parameters of the joint meeting of the full council and Warren County Board of Supervisors regarding the future of the Town-County Economic Development Authority was a hot topic of conversation. That joint Town-County-EDA meeting is scheduled for tonight, August 13, at 6 p.m. at the Villa Avenue Community Center.
The proposed agenda send to Interim Mayor Matthew Tederick included a presentation from the County side with updates on the distribution of property along with a time frame update. However Mayor Tederick brought this to the council with hesitance, stating, “We need necessary and pertinent information, but is that the best use of this joint meeting?”
Councilman Jacob Meza agreed, stating, “I would rather be able to sit down with the board of supervisors and discuss the greatest disaster between the County and the Town than sit through a 45-minute presentation given to us by the EDA board.”
Councilman Eugene Tewalt appeared to hit a middle ground, saying, “I want to get information – and I want to ask them some pertinent questions.”
It seemed that council was willing to move forward with the meeting including an EDA presentation, so long as EDA officials and the county board complied with giving information that council wants.
Tederick propelled the joint meeting forward with his July 18 Town-County Liaison Committee meeting statement that the Town could dissolve the EDA unilaterally and take half the remaining assets. If palpable tension was apparent in the wake of that assertion, it might be explained by some events leading up to it. After having a series of Freedom of Information Act (FOIA) requests for details of the EDA fraud investigation rejected by EDA/County Attorney Dan Whitten, the Town filed a lawsuit initially seeking return of about $3 million in Town assets, a number since raised to an estimate of $15 million in recoverable assets the Town believes it is owed by the EDA.
The issues with miscommunication between the EDA and Town Council became apparent when the next agenda item, financing of the new Front Royal Police Department headquarters, was reached. Due to confusion over what the EDA owes the Town, issues concerning the Town Budget cannot be resolved, town officials indicated.
“Who’s currently paying the debt service on this building – the EDA who has not provided the proper services and documentation to make those payments?” Tederick asked, adding, “We should not discuss any financing for the police department until we get documentation from the EDA.”
The Town’s elected officials and staff will seek some clarity on FRPD financing obligations, and the Town’s overall financial relationship with the EDA at tonight’s meeting.
See the work session discussion and Vice Mayor William Sealock’s response to Royal Examiner questions in the following videos.
(Roger Bianchini contributed to this story)
Henry civil case attorney argues insufficient evidence to proceed against her
As noted in our related story on the continuation of arguments on the penalty phase of a January default judgment ruling against former EDA Executive Director Jennifer McDonald, the primary arguments made by EDA civil case plaintiff and defense counsel on May 8 were whether there were substantive grounds in the EDA’s amended civil suit to charge McDonald’s former Administrative Assistant Michelle “Missy” Henry with intentional acts rising to the level of conspiracy or breach of fiduciary duty, with which she is accused.
Henry attorney John Cook told the court that the allegations against his client indicated nothing more than unintentional negligence, not rising to the level of conspiring to defraud her employer, the EDA Board of Directors.
On Henry’s behalf, Cook argued that to view McDonald’s subordinate as responsible for checking on the performance of her superior in such matters as submission of alleged forged documents was “a shocking reversal of the employment relationship”.
His client should not be held responsible if evidence of criminal behavior originating with her superior passed through her hands, Cook argued.
EDA attorney Lee Byrd responded that such arguments were more suitable further along in the movement toward trial. Byrd told the court that Henry’s “knowledge of (specifics of alleged crimes orchestrated by her boss, McDonald) are fair game for defense Discovery motions”.
“He’s right, we don’t have Ms. Henry’s fingerprints (on specific alleged criminal acts), we have Ms. McDonald’s,” Byrd told the court, adding, however, that as the case proceeds toward the trial “a more complete picture of what Ms. Henry has done” will emerge supporting the plaintiff’s case.
Byrd told the court Henry “abused” the responsibilities of her office in support of McDonald’s alleged financial crimes. And due to the “clandestine and covert” nature of such crimes, details of allegedly involved participants often take time to develop in the context of what the plaintiff hopes to prove were jointly conducted activities.
In asking for a ruling at this point in the case, Cook told the court that having to proceed toward trial based on currently sparse criminal evidence against her would bankrupt his client.
Judge Albertson took the arguments under advisement without comment.
Counsel present for Henry and defendants April Petty and Jesse Poe then all agreed to their availability for the 9 a.m. docket on June 18, for further motions on the EDA amended civil litigation against McDonald et al.
As noted in our related story McDonald attorney Peter Greenspun was disconnected from the proceedings by that point due to another legal commitment, so it was not clear if that date and time would be set for the McDonald default judgment arguments forecast by her attorney to take two to three days to complete.
See Royal Examiner’s related story on the delay on arguments regarding penalties from a January civil case default judgment against McDonald.
EDA’s May 8 meeting action agenda
The EDA board met virtually today for a special board meeting and took action on a wide variety of measures:
New Board Member
The Board of Directors welcomes new director Melissa Gordon. Ms. Gordon is a Warren County native and is looking forward to applying her extensive experience in accounting and IT to promote business in the Front Royal Warren County area. Ms. Gordon’s goal is in serving on the Board of Directors is to help attract new businesses and increasing the tax base. This will help decrease the tax burden on individuals and families, as well as provide more services and jobs in the community. She hopes to use her experience working with federal, state, and local funding agencies to support the retention and growth of current businesses in the area and promote Front Royal and Warren County as an ideal location for new businesses. She will be serving on the EDA Finance and Asset Management committees.
514 E. Main St.
The Board of Directors and Executive Director Doug Parsons are pleased to announce a sales contract for the purchase of 514 E. Main St., otherwise known as the Main St. Market Apartments, by Weber Properties, LLC for $127,500. The EDA hopes to close on this property by the end of the month. State legislation bars EDAs from owning multi-family housing properties so selling this property has been a priority for the agency.
Closure will allow the EDA to continue to focus on activities that bring jobs and economic opportunities to the Front Royal Warren County area.
Small Business Loan Updates
1. USDA Small Business Loan Committee- The Board continued to put the building blocks in place to start up the USDA Small Business Loan Committee. The Board appointed Mr. Jim Wolfe to chair the committee. Mr. Wolfe is the Entrepreneur in Residence and Assistant Professor of Management at George Mason University School of Business.
Additionally, the Board hammered out provisions of a loan application packet. Wolfe, Executive Director Doug Parsons, and EDA legal counsel Sharon Pandak, of Greehan, Taves, & Pandak, reviewed the draft with the Board and engaged in a detailed discussion of several important issues.
The Directors desire thoroughly vetted applicants and only those who meet the criteria will be awarded loans. Having a robust loan application process with high accountability and creditworthiness ensures that only good candidates who will have a successful impact on the economic life of our community will be considered.
2. RBEL/IRP Loans Emergency Deferment Program- The EDA wants to take the opportunity to remind current EDA small business loan clients who are current on their loan repayments as of March 2020 that they can request their loan payments be deferred through the month of August. Clients will be required to resume their regular monthly payments starting in September 2020. For each month the client defers their payment, one month will be added to the end of their loan commitment. Clients may contact the EDA office to request participation in this program. Please contact EDA Executive Director Doug Parsons.
The Board of Directors authorized EDA legal counsel Daniel Pond to file Warrant in Debt actions against former office tenant LaTasha Dozia-Earley/Selah Theater and RBEL loan client Stacy Sullivan/Primitives by Stacy. Efforts to work with these individuals on delinquent accounts failed to be resolved in 2019. Because of the extended lapse of time, the Board felt it necessary to go forward with collection actions.
Due to the continued COVID-19 pandemic and state of emergency, EDA Legal Counsel Sharon Pandak worked with the Board of Directors to approve an update to the current bylaws that further clarified the appropriate use of the virtual board meetings.
Finally, the Board had a brief discussion on the EDA FY2020-21 budget. Chair Ed Daley noted that the Warren County Board of Supervisors passed the budget earlier this month. There was no line item in the budget for debt service for the Front Royal Police Department. The goal is that the Town of Front Royal will obtain financing and pay off the construction loan the EDA secured in order to complete the project.
‘Disaster Relief’ background might be handy for newest EDA board member
At the outset of the Friday, May 8th Front Royal-Warren County Economic Development Authority Special Meeting, Board Chairman Ed Daley greeted newly appointed member Melissa Whitney Gordon to the EDA. The Warren County Board of Supervisors appointed Gordon three days earlier to replace resigned member Mark Baker as part of its Tuesday, May 5th meeting Consent Agenda. As previously reported, Baker’s seat has been vacant since January 23.
Daley asked Gordon about her background and experience.
“I have an MBA in accounting and a Masters in information systems. I have spent the majority of my career working in disaster recovery and emergency management – everything from accounting to operations to quality management program. And I currently serve as the chief strategy and information officer for a disaster recovery and disaster management consulting firm. So that means I oversee our entire quality management program for the company, all of our IT and also our corporate strategy and planning process,” Gordon replied.
On the personal side she added, “I’ve been a resident of Warren County for most of my life, moved here when I was six. I took a brief hiatus for about six years and then came back in 2004.”
“Well, welcome – we have committees, as I’ve mentioned before, and was wondering if you would work with Jorie (Martin) and Tom (Patteson) on the Finance Committee,” Daley replied.
“Sure, I’d be happy to,” Gordon responded, leading the chairman to suggest his newest board member double up and also join Martin on the Assets Committee.
Gordon again agreed to the suggested committee assignment.
“And if you see other things that you want to do, don’t hesitate, jump in,” Daley said in welcoming Gordon to the board.
“I need a disaster relief program, so that’s a good thing,” Martin joked of her new colleagues’ background.
“We do – and I won’t call what that person’s name is, we need disaster recovery from,” Daley chimed in, leading to some online laughter at the virtually conducted meeting.
Royal Examiner contacted Gordon by email the previous day about her professional background. She supplied us with an online business profile link pending a meeting to discuss her application and appointment to the EDA Board of Directors as it traverses the aftermath of a 2018 financial forensic audit that uncovered a history of alleged financial improprieties, embezzlements and misuse of EDA assets surrounding former executive director Jennifer McDonald.
We explored Gordon’s professional and educational background. She is listed as “Chief Strategy and Information Officer at Tidal Basin Government Consulting and Rising Phoenix Management Group, Washington D.C. Metro Area” for which she described her duties above.
Educationally, after initially pursuing undergraduate courses at Lee University in Cleveland, Tennessee (1998-2000), she received her Bachelor of Business Administration with a focus in Accounting from Campbell University in Buies Creek, North Carolina.
“I started at Lee; however, I finished my Bachelor’s through Campbell University in 2007 using their SOCMAR program,” she explained of her undergraduate transfer, explaining, “My ex-husband was a Marine. What the SOCMAR program allows, is for military members and their spouses to take a minimum number of classes through the degree issuing university, then take the remaining classes at an approved accredited university and transfer them back to the degree issuing university, which limits the number of credits lost through transfer.”
At the post-graduate level she achieved first, a Masters in Business Administration in Accounting (2008-2011), then a Master of Science Degree in Information Systems and Information Assurance (2015-2019), both from Liberty University in Lynchburg, Virginia.
With Lee, Campbell, and Liberty all having strong religious affiliations, we asked Gordon about the role of faith in her educational and professional lives.
“I grew up in a very religious environment. The higher education choices were not necessarily a byproduct of that environment, more a byproduct of circumstance, and the desire to continue my educational career in an environment that allowed me to continue working while doing so. I would say in terms of impact on my professional life or perspective, I am generally a rule follower and will often speak up if I have concerns, but I’m not sure how much of that is related to my religious upbringing versus just being my personality in general,” she replied.
Rule following is good within the EDA framework.
And with a lack of concerns or speaking up appearing to have been an issue at the root of much of the EDA’s past problems, if certainly not with its current board, we asked Gordon what prompted her interest in an EDA Board of Directors position in this difficult transition period.
“At the end of the day I’ve built a life here and have a desire to give back to the community and the needs of this position tended to align more with my skillset than other opportunities available. Also, as a mom, anything we do focused on economic development might give my kids a reason to come back home after college, which is an added bonus,” she told us.
On the personal side, Gordon is married with three children, ages 18, 16, and 8 – so she and her new EDA colleagues better get cracking on that economic development as two of those children prepare for the next level of their education and life experiences.
And a series of motions unanimously approved following a 2-1/2-hour closed session quickly adjourned to Friday morning, indicated the revamped EDA board and staff continue positive movement in that regard.
That open session discussion and actions involved a variety of EDA operations, including:
1- tweaks to its Small Business Loan program and the committee formed to oversee it;
2 – movement away from and towards the sale of the apartment building at 514 East Main Street;
3 – collection of back debts;
4 – approval of further changes to EDA bylaws facilitating electronic meetings during the COVID-19 pandemic emergency; and
5 – impacts of the county supervisors’ decision not consider the absorption of the EDA as a County Department until after the November election to see if what one supervisor appeared to refer to Tuesday as the “cancer” in town government regarding the existing EDA, was, at least partially, removed by ballot box surgery.
EDA selects firm to complete 2018-19 audits, among other actions
Following an approximate 90-minute closed session after a 60-minute open, virtual world regular EDA monthly meeting Friday morning, April 24, the Front Royal-Warren County Economic Development Authority Board of Directors passed a series of resolutions authorizing a variety of actions.
Among those actions approved by unanimous 6-0 votes, with the board’s seventh seat remaining vacant following Mark Baker’s January 23rd resignation, were:
1- authorization to proceed to a contract with Mid-Atlantic based regional accounting company Brown Edwards to complete the EDA’s Fiscal Year 2018 and 2019 audits;
2 – approval of an Emergency Deferment Program for the EDA’s Rural Business Enterprise (micro) Loan (RBEL) and Intermediary Relending Program (IRP) larger loan programs;
3 a-b – appointment of five members to the Small Business Loan Committee (SBLC) the EDA is forming to review and make recommendations on issuance of the EDA’s small business loan program; and approval of a charter on guidelines for the SBLC function and membership;
4 – authorization to use accumulated escrow account funds for several months of loan payments to First Bank of Strasburg; and,
5 – approval of a letter of support for EDA participation in a “Start-Up Shenandoah Valley” program.
Pulled from consideration at Friday’s meeting was the return of a security deposit on the terminated purchase plan of the 514 East Main Street apartment building.
Where to start?
Royal Examiner took a pandemic-precautionary masked man visit to the EDA’s Kendrick Lane headquarters after adjournment to accumulate some additional information than was available in remote virtual meeting world Friday morning to pin that down. We had some idea of priorities from past meeting comments and emphasis.
Finally, back audits contract
It is certainly good news to have come to the contract-signing time for a firm willing to take on an accounting of the EDA’s perhaps complicated finances over the past two years as the alleged financial scandal that exploded in the final year of former Executive Director Jennifer McDonald’s tenure was exposed by a contracted forensic audit and consequent civil litigation was filed and joined from several legal angles.
Of course certified public accounting firm Brown Edwards won’t be starting from scratch, as retired Warren County Finance Director Carolyn Stimmel and financial associate Heather Tweedie have put considerable effort into assembling the numbers at the base of the EDA financial activities of those two years.
With completed audits playing a role in the EDA’s ability to carry out future project financing as necessary, we asked Executive Director Doug Parsons about the choice of Brown Edwards and what kind of timeframe the EDA is hoping to have those audits accomplished.
Parsons noted the EDA was working with Brown Edwards out of its Roanoke office. The company’s website cites a mid-Atlantic regional focus based out of Virginia, West Virginia and Tennessee, with a national work history scope and staff of 350. It lists eight Virginia offices, two in West Virginia and one in Kingsport, Tennessee.
Parsons said both respondents to its audit Request For Proposals (RFP) were quality firms. The other candidate was SB & Company out of Owings Mill, Maryland.
“They were both very well qualified and great, great firms. And we really did have a very difficult time choosing between the two,” Parsons observed.
Of a completion timeframe, Parsons said, “We’re going to work with Brown Edwards to establish a deadline, but we’re going to propose September 30th for both the ’18 and the ’19 audits. We hope to get them before that, and I think we’ll get the ’18 pretty well before that … And you’re right, I feel we do have a bit of a head start because Carolyn and Heather did accumulate all this documentation.”
As for the positive impetus financially of completion of the audits, Parsons explained, “From the perspective of taking out new loans for an economic development project in the future, it would be. For a lot of the banks as far as any kind of new loan, and for some we’ve approached about refinancing, the number one heartburn is us not having our audits. So, we hope that opens the door to new fiscal opportunities down the road.”
As for the approval of an Emergency Deferment Program for the EDA’s Rural Business Enterprise Loan (RBEL) and Intermediary Relending Program (IRP), Parsons explained the RBEL was the EDA’s smaller business or “micro” loans and that the IRP is its three larger business loans. Qualifying clients of both will be offered temporary deferments as they navigate business impacts from the COVID-19 pandemic and response.
“The board approved more leniency for our existing customers who are in good standing during the COVID-19 crisis. They extended the latitude on payments out, I believe, to July,” Parsons said.
Small Business Loan Committee
And the EDA Board moved forward on the formation of a committee to review future business assistance loan applications.
“For the new loans that we’re getting ready to roll out, they appointed five members, and they also approved the charter pending the changes that we went over with our attorney,” Parsons told Royal Examiner. Included in those changes were term limits for members. A consensus was reached to initiate two-year terms, with a maximum service of two terms totaling four years of overseeing, having denial authority, and forwarding other applications to the EDA Board of Directors for final approval.
“It gives them an idea of what they’re getting into,” Board Chairman Daley observed of the term limits.
The five appointees to the SBLC are: Bediong A. Nyokon, whom Parsons said brings much financial experience to the committee; Ashley Shickle, who is with the Northern Shenandoah Valley Regional Commission; Jeanian Clark, vice president of Workforce Solutions at Lord Fairfax Community College with a focus on employer and community outreach and corporate training; Chris Laurence, a local realtor with Key Moves Properties; and Jim Wolfe, an assistant professor at George Mason University.
The creation of the advisory committee appears to be a move toward added transparency and oversight to avoid the kind of insider favors alleged to have occurred in the EDA civil litigation stemming from the Cherry Bekaert investigation of EDA finances focused on the 2014-2018 time period.
Parsons explained the Small Business Loan process as it is developing. “It looks like Gretchen (EDA Administrative Assistant Gretchen Henderson) and I will be the first to review the incoming applications to make sure they’re complete and not completely out of leftfield. And if they look good, and they’re complete we’ll forward them to the loan committee for their review. The loan committee can deny it right there within committee. But the ones that they feel are viable they will forward to the full (EDA) board of directors for further review and consideration.”
He noted that those rejected in the committee would not be forwarded to the EDA board for further consideration unless there was an applicant request for further justification of the rejection.
“We’re really happy that the charter and loan committee were approved, and we’ll move forward and get to a point here soon where we’ll be able to offer these loans to the community.”
Of the pulling of the security deposit reimbursement on the 514 East Main Street apartment building from the agenda, rather than either a positive sign the deal wasn’t completely dead or that anything was wrong, Parson said the tabling was more from an abundance of caution.
“We need to look at the sales contract. The board just wasn’t ready – I think they just tabled it … so they could explore the contract a little more. We didn’t have it at our fingertips. So, we just want to make sure we do the right thing for the EDA and the purchaser.”
Audio Link; No Town Report
Hear a discussion of these matters, as well as the EDA’s earlier monthly Finance and Communications Committee Reports; Parsons’ Executive Director’s report; County Administrator Doug Stanley’s report on county projects, including the potential of absorbing the EDA’s two-person staff into the County’s departmental umbrella; not to mention Chairman Daley’s report on being momentarily disconnected from the meeting by his cat’s attempt to seize control of the phone by which he was communicating to the board verbally, in the below linked Royal Examiner recording.
One report you will not hear is the Front Royal Town Manager’s monthly update on Town projects. Despite its traditional spot on the Town-County EDA monthly meeting agenda, Interim Town Manager Matt Tederick was again not present nor linked in to give the monthly Town Manager’s Report, nor was there a written Town report submitted to the EDA agenda packet.
As previously reported, the Town has filed hostile litigation against the EDA, now seeking recovery of over $20 million while the EDA continues to offer non-attorney-fee fueled negotiations to establish exactly what it may owe the Town in misdirected assets.
And while indicating a desire to stay legally connected to the existing EDA while moving toward the creation of a second, unilateral EDA, the Town continues to decline participation in the existing EDA’s meetings.
Dropping of EDA criminal cases a prosecution tactic, not vindication
In a statement emailed at 12:47 p.m., Friday, April 17, Front Royal-Warren County Economic Development Authority criminal case Special Prosecutor Michael Parker informed the media that all criminal charges against the four people indicted by the EDA Special Grand Jury related to the EDA financial scandal would be dropped without prejudice. A hearing on those indictments has been scheduled for Friday afternoon.
“Today Judge Albertson will sign orders of nolle prosequi with respect to all criminal matters that were brought as a result of the special grand jury investigation. This applies to all defendants and all counts. As with Donnie Poe, these are dismissals without prejudice. That means the same charges, and more charges if appropriate, can be brought at any time in the future,” Parker wrote.
Those defendants are former EDA Executive Director Jennifer McDonald, her former Administrative Assistant Michelle Henry, McDonald’s husband, Samuel North, and former B&G Goods principal William Lambert, as well as Poe, who had his charges dismissed without prejudice in January as a perjury trial date was approaching.
“I assure you I am not pleased about this. I also assure you this is not the end,” Parker continued in his written statement, adding, “However, while it is my duty to bring justice to the guilty, it is also my duty to be just and ethical in my conduct at all times, to everybody. That includes people who have been accused but have not yet been found guilty. At the current time, I am unable to satisfy certain basic obligations I have to the defendants, which have existed since before I was appointed on the case. I cannot ethically keep this status quo. In fact, if I tried to keep the cases active, I’d run the risk of a judge at some point, dismissing them with prejudice, so that I could not bring them back.”
Contacted by phone following the release of his statement, Parker said it was “overwhelmingly likely” that some criminal charges would be refiled when he and the Virginia Court and grand jury system were not operating under restrictions imposed by the COVID-19 pandemic emergency response. He pointed out some of the criminal charges were filed a year ago, with COVID-19 (Coronavirus Disease-2019) impacts potentially slowing court processes for months, if not a year into the future.
However, while he observed that COVID-19 cases were “exploding” in Harrisonburg and Rockingham County where he and EDA case Judge Bruce D. Albertson are based, Parker stressed that the COVID-19 impacts were not the primary factor at issue in his decision.
Parker was appointed special prosecutor in late November 2019 following the withdrawal of original EDA Special Grand Jury prosecutors Brian Madden, who left to a judgeship appointment, and his Assistant Commonwealth’s Attorney Bryan Layton, who lost the November Commonwealth’s Attorney election to John Bell. Bell and his entire staff recused themselves from all EDA cases due to past or continued professional or personal connections to some EDA defendants.
And as been previously noted, the investigation into EDA finances and the consequent civil and criminal investigations and filings have generated an estimated million pages of documentation.
“This is a protective measure to keep these charges viable,” Parker said in support of his written statement. That statement also addressed the special grand jury process begun about a year ago, and twice extended for six months.
“This has nothing to do with the special grand jury. Their work has been tireless, diligent, and unfortunately thankless,” Parker wrote, observing, “Their excellent work will continue when it is safe to return, and appropriate charges will be brought when they conclude. If I had been appointed to this matter from the very beginning, this is the procedure I would have followed anyway: the grand jury investigates, the grand jury finishes investigating, the grand jury makes recommendations, and I choose what to prosecute.”
Parker fell short of criticizing the previous prosecutors leading the EDA grand jury.
“I would have proceeded differently,” Parker said of the special grand jury’s process prior to his arrival of issuing rounds of charges at intervals as their investigation proceeded. “I’m not laying any blame on those who came before me. They may have had a plan had they continued with the grand jury. However, I would have proceeded in the more traditional manner and brought the charges after the investigation had concluded.”
“I have a legal obligation not to keep people on the hook indefinitely,” Parker observed of the prosecutorial situation he found himself thrust into about 4-1/2 months ago.
So while now “off the hook” criminally, if not civilly, the quintet of now-former EDA criminal defendants are aware their new-found situation may not last forever. McDonald, Henry, Poe, North, and Lambert are all also named in the EDA’s original $21.3 million amended civil litigation against the former EDA executive director and 14 co-defendants.
As reported previously, that litigation was recently expanded by the addition of a second civil action against nine new defendants seeking an additional $4.45 million.
EDA seeks $4.45 million-plus in civil action against 9 new defendants
McDonald criminal hearings still listed on Friday’s Circuit Court docket
The second civil litigation authorized on April 10th by the Front Royal-Warren County Economic Development Authority was filed in Warren County Circuit Court on Wednesday, April 15th. It seeks “judgement against the Defendants jointly and severally for an amount not less than $4,454,100.04” – you’ve got to like the legal-financial preciseness of that 4 cents tagged on to $4.45-million dollars; as well as punitive damages of “at least $350,000 … jointly and severally against each of the defendants.”
As reported in our coverage of authorization to file the new civil litigation, those new defendants are TLC Settlements, LLC, and agent Tracy L. Bowers, Service Title of Front Royal, LLC and processor Victoria L Williams, Century 21-Campbell Realty and principals Jeannette M. and Walter L. Campbell, Rappawan, Inc. and principal William T. Vaught Jr.
The first page of the 30-page complaint links real estate transactions cited in the EDA’s first civil suit against former EDA Executive Director Jennifer R. McDonald and 14 co-defendants, involving the cited settlement and real estate companies and principals.
“From at least 2014 to 2018, several real estate transactions were initiated and/or consummated by the Defendants herein with funds stolen from the Industrial Development Authority of the Town of Front Royal and County of Warren, Virginia (also known as Economic Development Authority/EDA) … in violation of express duties established in the Code of Virginia and well-established legal principals of the Commonwealth of Virginia,” the civil complaint begins, adding the new defendants to the list of alleged accomplices of former EDA Executive Director McDonald.
“This is an action against confederates and co-conspirators of Jennifer R. McDonald … to redress these unlawful takings and to recover assets that are lawfully the property of the Warren EDA, all as alleged (a) below and (b) in that certain First Amended Complaint filed in this Court in Case Number CL19-398,” paragraph one continues.
That opening salvo from the EDA’s Sands Anderson legal team explains the new civil complaint essentially as an expansion of the now-amended first civil complaint which is attached with multiple familiar documents and real estate-transaction exhibits that overlap between the new and old EDA civil complaints.
The sought judgment of a minimum of $4.45 million against the nine new human and business entity defendants, coupled with the Amended First EDA Civil Complaint total of “not less than $21.3-million” against McDonald and 14 co-defendants brings the total EDA assets being sought for recovery to about $26 million in real estate or financial assets.
The ”Overview” of the new civil complaint lists seven “schemes to unlawfully enrich themselves at the expense of the Warren EDA” involving “money unlawfully taken from Warren EDA by one or more of the Defendants in the following seven (7) matters.”
Those matters are:
“A – the Workforce Housing/Royal Lane Property Embezzlements (Century 21-Campbell Realty);
B – Purchase of 1321 Happy Creek Road, Front Royal, Va. (TLC Settlements-Bowers);
C – Purchase of 2951 Rileyville Road, Page County, Va. (TLC Settlements-Bowers).;
D – Purchase and Sale Transactions with William Vaught and Rappawan (also TLC-Bowers involvement);
E – Purchase of House for Samuel North (Service Title of FR-Williams);
F – Purchase of House for Jesse Poe (Service Title of FR-Williams);
G – Purchase of House for William Lambert (Service Title of FR-Williams).
Much detail on the specific transactions and amounts of money involved in various related transactions are included in the civil complaint now on file at the Warren County Circuit Court Clerk’s Office.
In a related matter, we asked Circuit Court Clerk Angie Moore if scheduled afternoon civil and criminal hearings for Jennifer McDonald on Friday, April 17, were still on. Moore replied that the civil hearings had been tentatively continued to May 8, at 2:30 p.m., but the criminal hearings were still appearing on Friday’s docket at 3:30 p.m.
Contacted later on Thursday, Special EDA criminal prosecutor Michael Parker of Rockingham County said he was still awaiting word from Judge Bruce D. Albertson on whether those criminal hearings would occur in the courtroom, by remote phone and/or video conference call connections, or might also be continued as the civil hearings were.
COVID-19 pandemic emergency management protocols in place statewide and locally continue to impact, not only social, business, and local government operations, but some “non-essential” court functions as well. One might guess from previous courtroom comments by McDonald’s attorney Peter Greenspun, that he considers moving forward toward resolution of the 30-plus felony financial indictments against his client as an “essential” court function under right-to-speedy-trial statutes.
Royal Examiner will attempt to be present physically, virtually, or by any other means available to keep you posted on what happens or doesn’t happen tomorrow on the EDA-McDonald legal front.