Washington Jury Finds Spokane Valley Couple Guilty of Fraud Charges in Connection to COVID-19 Relief Loan

Spokane, Washington – A federal jury returned a guilty verdict in the trial of a Raymond Joe and Jennifer Lynn Hilderbrand, both age 54, of Spokane Valley, Washington. The Hilderbrands were found guilty on multiple fraud charges.

United States District Judge Thomas O. Rice presided over the trial, which began April 21, 2025. At sentencing, which is set for July 23, 2025, the Hilderbrands face a maximum term of 20 years in prison as well as restitution for fraudulently-obtained funds.

On March 27, 2020, the President signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act.  The CARES Act provided a number of programs through which eligible small businesses could request and obtain relief funding intended to mitigate the economic impacts of the pandemic for small and local businesses. One such program, the Economic Injury Disaster Loan (EIDL) program, provided low interest loans that could be deferred until the conclusion of the pandemic to provide “bridge” funding for small businesses to maintain their operations during shutdowns and other economic circumstances caused by the pandemic.  The EIDL program have provided billions of dollars in aid, the vast majority of which have not been paid back, including hundreds of millions of dollars disbursed within Eastern Washington.   

The evidence presented at trial established that the Hilderbrands engaged in elaborate scheme to obtain money from the Small Business Administration (SBA) to spend on their entertainment business called Poweline Enterprise LLC (Powerline), even though in September of 2021, the SBA had declined to fund a loan for the company.

To execute this scheme, in January of 2022, Raymond Hilderbrand completed a EIDL application in the name of Hilderbrand Auto Services, which was an automotive repair business, owned by the Raymond Hilderbrand, located at 10423 E. Trent Avenue, Spokane Valley. In the application he told the SBA the EIDL funds would be used as working capital for Hilderbrand Auto Services, and would not be used for another company. However, in February 2022, when SBA sent $320,000 to Hilderbrand Auto to be used by that business to alleviate economic injury caused by the pandemic, the Hilderbrands immediately transferred $311,000 to Powerline. The Hilderbrands then used $295,000 of the EIDL funds to purchase the Trent Avenue property in the name of Powerline, with Jennifer Hilderbrand as the only owner.

The Hilderbrands continued to attempt to obtain additional EIDL funds in the name of Powerline by making false representations about the company’s revenue on their EIDL application. The SBA declined the reconsideration of the Powerline EIDL application in early May of 2022. Shortly thereafter, the Hilderbrands requested a modification for the EIDL loan for Hilderbrand Auto. The SBA approved the request, and Raymond Hilderbrand again promised to use the money solely for Hilderbrand Auto. On May 17, 2022, the SBA disbursed an additional $43,000 in EIDL funds to the Hilderbrand Auto bank account, $35,000 of which was immediately withdrawn by check and transferred to Powerline.

In May 2022, the Hilderbrands submitted an application on behalf of Powerline for a license to sell alcohol and food at the Trent Avenue Property. Then, in the summer of 2022, the Hilderbrands began to host concerts at the Trent Avenue property. The advertisements billed the property as “The YARD, A New Upcoming Outdoor Venue in Spokane WA!” that included beer gardens and food vendors. The advertisement also indicated the concert was “brought to you by” “Powerline Enterprises” along with other companies.

In September 2022, the Hilderbrands applied for a new application for a snack bar license on behalf of Powerline for the Trent Avenue Property. During an interview with a license investigator, Raymond Hilderbrand stated the company’s hope was to host swap meets and multiple activities, with a snack bar inside a building with outside seating. Mr. Hilderbrand was asked if Powerline shared the property with any other businesses and he responded, “No,” even though the property was shared with Hilderbrand Auto. Mr. Hilderbrand also acknowledged that Powerline had bought the property for $295,000. The investigator asked if any of the funds for the purchase were “gifted or loaned from a business source,” to which Hilderbrand falsely responded “no.”

“I am grateful for the prosecutors and investigators that worked together to seek justice in this case,” stated Acting United States Attorney Rich Barker.  “Our incredible trial team worked closely with the SBA to present a compelling case, establishing that both Raymond and Jennifer Hilderbrand were held accountable for the lies they told to obtain funding that was designed for small businesses in need of a lifeline.  As a result of the Hilderbrands’ fraud, other small businesses were unable to obtain the help they needed during the COVID-19 pandemic.”

 "These guilty verdicts demonstrate the commitment of the Treasury Inspector General for Tax Administration (TIGTA) to investigate and bring to justice those who victimize the American taxpayer," said Daniel Dahl, TIGTA Acting Special Agent-in-Charge.  “Fraudulently applying for loans through a federal program meant to assist Americans in need will be met with aggressive investigation and prosecution.  I want to thank our law enforcement partners and the U.S. Attorney's Office for their commitment to this goal."

“Today’s verdict is a testament to the OIG’s unwavering commitment to bringing fraudsters targeting SBA’s programs to justice,” said SBA OIG’s Western Region Assistant Special Agent in Charge Wil Barras.  I want to thank the U.S. Attorney’s Office, and our law enforcement partners for their diligence and pursuit of justice.”

This case was investigated by the Eastern District of Washington COVID-19 Fraud Strike Force and by TIGTA, SBA OIG, and IRS-CI.  This case is being prosecuted by Assistant United States Attorneys Frieda K. Zimmerman, Jeremy J. Kelley, and Jacob Brooks.

2:23-cr-00114-TOR