Jailed developer Greg Jeffreys pleaded guilty Thursday to swindling millions from investors, banks and the federal government to fund a lavish lifestyle.
Prosecutors want him imprisoned for eight years and to repay duped investors millions of dollars on the four criminal counts of fraud and contempt of court stretching from 2006 through May.
Jeffreys reserved the right to dispute the amount he must pay at sentencing, tentatively scheduled for February. Prosecutors expect at least a full day of testimony from those who paid the developer after promises of mind-boggling returns on their investments.
Many of Jeffreys’ building projects and investments were tangled into complex frauds that took investigators years to unwind. The vacant Ridpath Hotel and all of the financial problems that turned it into a highrise eyesore in the heart of Spokane have been partly blamed on Jeffreys.
The convictions close a year of legal posturing by Jeffreys and his girlfriend, Shannon Stiltner, who pleaded guilty on Thursday to charges that she concealed Jeffreys’ fraud. Stiltner’s attorney, John McIntire, said his client learned of the schemes through news reports and “deliberately avoided learning the truth” about his schemes.
Her plea deal calls for a seven-month prison sentence and $58,000 in restitution to two people. Her sentencing is also scheduled for February.
Jeffreys’ wife, Kimberly, continues to fight related criminal charges.
Investigators accused the couple of pocketing millions from the federal government after building a military entrance processing station on U.S. Highway 2 for far less than was committed to the project by both the United States and private investors. The original indictment detailed a web of limited liability companies that drew investments from individuals for projects that never materialized.
Greg Jeffreys has remained in custody since his January arrest. In a statement during the Thursday afternoon court hearing, Jeffreys took the blame for the fraud and sought to downplay Stiltner’s role in the scheme.
While in jail awaiting trial, he violated court orders by contacting Stiltner and urging her to sell property, pay debts and pass along messages to others on the outside.
“I, personally, initiated every one of those phone calls,” Jeffreys told U.S. District Judge Rosanna Malouf Peterson.
Court records detailed a lifestyle in the fast lane for Jeffreys, a University High School graduate who owned a showy three-story home in Spokane Valley as well as residences in Arizona, Las Vegas and elsewhere. Prosecutors say Jeffreys gambled away hundreds of thousands of dollars while sharing a suite with Stiltner at the Mandalay Bay casino.
Jeffreys is also implicated in the financial tangle that has kept the landmark Ridpath Hotel vacant for years. Additional charges filed in September accuse him of defrauding a bank to buy two floors of the Ridpath when it was sold off in pieces.
Investigators had alleged Stiltner became a skilled recruiter for Jeffreys, accepting wire payments of tens of thousands of dollars from investors and depositing the money in accounts she had established with several banks. But those charges were dropped as a result of the plea agreement.
Kimberly Jeffreys stated her intention to continue fighting the criminal charges against her before Peterson on Thursday morning.
Peterson ruled in favor of Kimberly Jeffreys’ request to keep jurors from hearing evidence that the money she’s accused of stealing from the federal government came from stimulus funds. Her trial is scheduled for April.