Arrow-right Camera
The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Coeur d’Alene man gets nearly 4 years in prison for multimillion dollar fraud scheme

A 64-year-old owner of a Coeur d’Alene forestry management company was sentenced to nearly four years in federal prison for fraudulently obtaining at least $2.5 million from a different forestry management business, the U.S. Department of Justice announced Wednesday.

Douglas Worman entered, through his company, Worman Forest Management, into a factoring agreement in 2010 with J.S. Richards Forestry Management to sell millions of dollars of Worman Forest Management’s accounts receivable that were based on invoices for work the business provided to its customers, according to a news release from the U.S. Attorney’s Office – District of Idaho, which cited court records and evidence at trial.

Factoring is a form of short-term financing in which a business sells its accounts receivable to a third party at a discount. The seller of an invoice obtains funding from a buyer, and the buyer of an invoice earns a fee for providing the up-front financing.

From 2015 to 2018, Worman submitted inflated, false and fraudulent invoices to J.S. Richards Forestry Management for factoring, purportedly for work Worman’s business had performed for its customers, the release said.

Between June and September 2018, Worman submitted over $2 million in fraudulent invoices for factoring to J.S. Richards Forestry Management.

A federal jury convicted Worman of 17 counts of wire fraud for the factoring scheme after a six-day trial in August. Chief U.S. District Judge David Nye recently sentenced Worman, of Coeur d’Alene, to 46 months in prison and three years of supervised release. Worman must pay restitution, with the amount to be determined.

“This case sends a clear message that, along with our law enforcement partners, we will not tolerate fraud in Idaho’s business community,” U.S. Attorney Josh Hurwit said in the release. “I am grateful for the FBI’s painstaking investigation of the defendant’s fraud and the tenacious work of our office’s prosecutors to marshal the evidence for the jury.”

Hurwit commended the investigation by the FBI, which led to the charges.

“Douglas Worman is being held accountable for exploiting the trust of his victims,” Acting Special Agent in Charge Albert Kelly of the Salt Lake City FBI office said in the release. “The FBI is committed to protecting Idahoans by investigating and arresting those who seek to defraud others. We also encourage the public to report potential fraud to the FBI.”