Former ED of Front Royal, Warren EDA sentenced for stealing $5M in public funds

The former executive director of the Economic Development Authority of Front Royal and Warren County was sentenced Wednesday to 14 years in federal prison after stealing more than $5 million in funds.

Jennifer Rae McDonald, 45, of Front Royal, was convicted following a nine-week jury trial in November 2023 of seven counts of wire fraud, six counts of bank fraud, 16 counts of money laundering and one count of aggravated identity theft.

According to court documents and evidence presented at trial, beginning in 2014, McDonald began stealing money from the EDA and, for more than four years, McDonald used the bank accounts and credit facilities of the EDA to divert public funds to purchase real estate and to pay for her personal expenses.

She falsified documents in order to mislead the EDA’s Board of Directors, external auditors and Warren County and Front Royal government officials.

When confronted by law enforcement and others, McDonald drafted fake loan documents, encouraged others to lie before a grand jury and fabricated an outrageous story, alleging the fraud was part of a “secret settlement” and creating more fake documents to cover up her fraud.

In total, McDonald pilfered the EDA’s bank accounts and is responsible for $5.2 million in losses.

At trial, evidence was presented that at least $2.4 million of the money McDonald stole was used to fund her gambling including net losses of more than $750,000.

“For more than four years, Jennifer McDonald used EDA funds as her personal piggy bank diverting public funds to purchase real estate and to pay her personal expenses” said Christopher R. Kavanaugh, U.S. Attorney.

“Today’s sentence reflects how serious this office takes fraud and the misuse of public funds. I am thankful to the FBI and the Virginia State Police for the tireless work they did to untangle the web of lies spun by this defendant.”