Spokane developer indicted in Ponzi scheme

The one-time owner of a portion of the Ridpath Hotel, Spokane developer Greg Jeffreys, has been arrested, indicted on 73 counts of bank fraud, money laundering and wire fraud.

Jeffreys, 53, his wife Kimberly, and another woman, Shannon Stiltner, were arrested on multiple counts laid out in a 51-page indictment unsealed Wednesday morning. Jeffreys faces 73 counts while his wife 25 and Stiltner faces 29 counts, accused by federal prosecutors for operating a Ponzi scheme.

Jeffreys showed few emotions in court Wednesday, while his wife cried before the hearing got underway. Stiltner, meanwhile, was smiling and engaging in conversation with a handful of people in the room before the hearing.

For example, in 2009, the couple received a $700,000 loan to help build the military entrance processing station in Airway Heights. Jeffreys only paid $480,000 for construction costs.

Court documents said they "falsely and fraudulently solicited and received, approximately 1.35 Million from private MEPS investors." The General Service Administration paid the Jeffreys' $1.8 Million dollars to complete the project but court documents allege the funds were wired to their personal bank account instead of the lenders for "their own personal use and benefit."

It's a scheme prosecutors allege they pulled off several times to the tune of several million dollars.

The government is looking to seize a car, property the couple owns in Arizona and cash that prosecutors said is profits from years of fraud.

The Jeffreys were one-time owners of part of the Ridpath Hotel but defaulted on the loan for that property last year.

In court Wednesday the trio pled not guilty to the charges they're facing. Kimberly Jeffreys and Shannon Stiltner had their bonds set at $150,000. A bond hearing for Greg Jeffreys will be held at a later date.

If convicted on all counts the trio could spend the rest of their lives in prison.