FRONT ROYAL – Donnie Poe, one of the nine defendants in the Front Royal-Warren County Economic Development Authority’s $17.6 embezzlement and misappropriation lawsuit, was arrested Tuesday afternoon on two felony counts of obtaining money by false pretenses and one felony count of perjury, according to the Rappahannock-Shenandoah-Warren County Regional Jail’s website.

Poe, who is the co-owner of Earth Right Energy Solar-Commercial LLC - another defendant in the EDA’s lawsuit - was booked into the jail at about 3:30 p.m. Tuesday.

The arrest came a day after Jennifer McDonald, former EDA executive director, was indicted by a special grand jury investigating the EDA on two felony counts of embezzlement and conspiracy to obtain money by false pretenses. She now stands charged on 14 felony counts of embezzlement and obtaining money by false pretenses, with indictments on the two Monday charges stating the alleged offenses occurred between on or about Sept. 1-22,  and Sept. 18-20.

While indictments against Poe were not yet filed in the Warren County Circuit Court office as of 4:30 p.m. Tuesday, several allegations outlined in a report by Cherry Bekaert – the firm hired to investigate the EDA’s finances - state that McDonald on Sept. 18 sent an email telling former EDA administrative assistant Missy Henry to wire money to Earth Right Energy.

According to Cherry Bekaert's report, Poe allegedly conspired with McDonald to have Earth Right Energy and the EDA enter contracts for the installation of solar panels at 426 Baugh Drive and the EDA’s office. Some of that work, the report states, was never completed although there are solar panels on the top of the EDA’s office building.

Poe was previously called to testify before the special grand jury. 

The report states that those deals resulted in the embezzlement of $1.28 million, of which Earth Right Energy paid back $334,851, reducing the alleged damages to $945,037. The report adds that McDonald told the EDA board the work would be free, as Earth Right Energy could write off expenses using federal tax credits.

However, the signatures of former EDA chairman Greg Drescher and former vice chairman Bruce Drummond  appear on checks made out to the company. EDA and County Attorney Dan Whitten previously said he did not know if those signatures were forged or not. Last week, Drescher declined to comment on the matter and Drummond could not be reached for comment.

The report also alleges that McDonald entered a $27 million contract, which the EDA board never approved, with Earth Right Energy for the installation of solar equipment on county schools. This contract, however, is not part of the alleged damages as the report states it was “unlawfully procured, is invalid and unenforceable.” The report states that the contract was signed on Sept. 13 by McDonald and Justin Appleton, who is the co-owner of Earth Right Energy and a defendant in the EDA’s civil lawsuit.

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This story's headline has been updated. Donald Poe was charged with three felony charged.

– Contact Josh Gully at jgully@nvdaily.com