May 21, 2014 in City

Feds now want developer Greg Jeffreys to repay $12 million

By The Spokesman-Review

A recent U.S. Supreme Court opinion has federal prosecutors asking for about $2 million more in restitution from jailed Spokane developer Greg Jeffreys, who pleaded guilty last year to wire fraud in a series of real estate schemes.

Sentencing documents filed ahead of a scheduled hearing in June had originally asked Jeffreys to repay $10.3 million. He admitted in November to duping individual investors and banks on projects including condominiums, units in the downtown Ridpath tower and a military facility off Highway 2. But a decision rendered in Washington, D.C., earlier this month in the Wisconsin case of a convicted mortgage fraudster prompted prosecutors to revise that amount closer to $12 million.

The unanimous decision in Robers v. United States, overturned restitution guidelines set by the 9th U.S. Circuit Court of Appeals, according to prosecutors.

While the Wisconsin court ruled Benjamin Robers – a man who bought two houses using fraudulent loan applications – must pay the difference between the amount the bank loaned and how much the properties sold for after foreclosure, the 9th Circuit had calculated restitution based on the value of the properties at the time they were seized.

The Supreme Court agreed to hear the case in February 2013 to settle the dispute in the way the two courts calculated restitution.

The decision affirming the Wisconsin court’s practice increases the amount Jeffreys owes banks and investors on three properties that were foreclosed upon, prosecutors say in documents filed last week. This includes units in the downtown Ridpath tower.

Jeffreys’ ex-wife, Kimberly Jeffreys, also pleaded guilty in February to a charge of fraud in dealings surrounding the military facility. She is tentatively scheduled to be sentenced in July for her role in the scheme, facing a potential six-month sentence and restitution of close to $160,000.

Shannon Stiltner, a woman who lived with Greg Jeffreys in Las Vegas and pleaded guilty in November to deliberately ignoring signs her boyfriend was swindling investors, is serving her seven-month sentence at a federal detention center in Seattle. Stiltner has been ordered to pay $58,000 in restitution and is scheduled for release in August.

Prosecutors have not filed requests to change Kimberly Jeffreys’ or Shannon Stiltner’s restitution amounts.

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