FRONT ROYAL – Court documents in the U.S. Western District Court of Virginia were unsealed Tuesday and detailed evidence removed from the Front Royal-Warren County Economic Development Authority’s office during the execution of an April search warrant.
According to an affidavit submitted by FBI Special Agent Justin P. Hasty, the FBI and Virginia State Police are investigating a “scheme to commit wire fraud and bank fraud and then to launder the proceeds of those crimes committed.”
The 33-page affidavit focuses on “at least three different occasions” that former EDA Executive Director Jennifer McDonald allegedly used EDA funds and credit lines for personal real estate purchases through DaBoyz LLC. The three transactions detailed in the affidavit are the purchases of 1321 Happy Creek Road, 2951 Rileyville Road and 2890 Buck Mountain Road.
The affidavit states that McDonald claimed her source of income was about $1.8 million in gambling winnings, but state police obtained records showing that she lost over $700,000 gambling.
The affidavit notes that during a Dec. 19 investigation with state police, McDonald admitted to having a gambling addiction and that she "had borrowed the maximum amount on her credit cards and mortgaged several properties to fund her gambling habit.”
“She also stated she had borrowed large sums of money from relatives,” according to the affidavit.
The day after that interview, McDonald resigned as the EDA’s executive director.
She has since been indicted on 28 felony charges by a local special grand jury stemming from financial transactions during her tenure as the EDA’s executive director.
A court order signed April 15 states the documents were sealed for 180 days because “the disclosure of the documents could alert suspects in a criminal investigation and/or hinder the government’s efforts in the ongoing investigation.”
Listed in the unsealed documents are 57 line items of inventory collected during the EDA office search. Those items were:
- Clickfree external USB HDD 320 GB Model HD327 SN WD1011XM.
- Three zip disks and two optical disks.
- Sands Anderson paperwork from Sept. 27, 2016.
- Apple all in one desktop computer.
- Jennifer Rae McDonald real estate board sole proprietor license.
- Universal steno book with handwritten notes.
- Apple iPhone.
- 2012 financial report, paperwork regarding various projects.
- Yellow sticky note with passwords written on it.
- Six files containing various documents.
- Various bills and invoices.
- One confidential tax information disk, one green file folder and various other paperwork.
- Green binder containing information on various projects.
- Purple file folder containing letters and emails.
- White envelope containing receipts.
- EDA transaction detail by account, letter from First Royal Bank.
- Two yellow file folders labeled Project Vet and Project Dusty.
- Paper with email address and password.
- USB thumb drive.
- Thumb drive.
- SD card.
- One green file folder marked budget 2014/15, one file folder marked Refinance 2012.
- One yellow folder and various paperwork.
- One spiral bound notebook and various bills and invoices.
- One red folder labeled Hospital, one yellow file folder labeled Greenhouse.
- One financial report from June 2015, one file folder labeled Career Connect.
- One blue file folder containing various documents.
- One CD labeled Leach Run PKWY.
- Two file folders and various envelopes and documents.
- Three thumb drives.
- Acer Aspire.
- Handwritten notes, business card, real estate license, letter.
- Various documents.
- Vendor case payment details for Little Rugratz Daycare.
- Printed email regarding a meeting.
- Four thumb drives.
- 15 optical disks in an orange envelope.
- Three file folders, one labeled DaBoyz, LLC, various documents.
- Green folder labeled wines-booker.
- Various documents.
- One black box and one file folder containing various documents and miscellaneous items.
- Various binders and documents.
- Miscellaneous documents and binders.
- One binder containing copies of checks and other payment receipts.
- Two leather-bound folders and various other documents.
- Various file folders and miscellaneous documents.
- One file folder and three envelopes.
- File folder labeled Royal Phoenix Vesp correspondence.
- Two thumb drives.
- Miscellaneous papers and file folders.
- Brown accordion folder containing miscellaneous documents.
- Clear tote containing various file folders.
- One blue binder and three file folders.
- Various file folders.
- Various file folders.
- Statement from Jan. 1 2017-Feb. 2, 2017.