Turns out Lilly apparently was living in Gold Bar under the alias Dave Murray. It also turns out that Lilly likely is dead. His wife told detectives that Lilly, 64, died from pancreatic cancer in 2012.
She admitted to burying him in the back yard.
Snohomish County sheriff's detectives last week found human remains under a woodshed behind the woman's Gold Bar home.
The medical examiner has not officially identified the remains and the case remains under investigation, sheriff's spokeswoman Shari Ireton said Wednesday.
"The investigation will continue until the medical examiner has confirmed the identity and cause and manner of death," she said. "If it's not who we think it is or if the death is not natural, we'll go from there."
Somewhere between Missouri and Gold Bar, Dennis and Mary Lilly became Dave and Amanda Murray, court papers say.
Quiet life in Gold Bar
The couple settled into a home at the end of a dead end street in the century-old town of roughly 2,000 people. Amanda Murray bought the property in 1993, according to Snohomish County Assessor's Office records.
They became respected business owners, running The Mail Station out of a beige A-frame building just off U.S. 2 on the east outskirts of Monroe.
Over the years, Dennis Lilly posed as Santa Claus with children from across the Sky Valley who ventured into the family business each Christmas. He could grow an impressive white beard.
"Heck, his photo is probably in hundreds of homes," said Mitch Ruth of Ruth Realty, which is next door and leases out The Mail Station building.
Lilly became secure enough in his new persona to call police when he had concerns about crime. In 2010, he reported to the Monroe Police Department that someone sent a child pornography catalog to his business from the Virgin Islands.
"I guess you never know," said Ruth, who was a corrections sergeant at the Washington State Reformatory before going into real estate. He spent just shy of 15 years working behind the bars of the Monroe prison. Along the way, he monitored and studied thousands of inmates.
It's hard for him to imagine that Dave Murray — Lilly — and his wife ever could have run afoul of the law.
"They were always honest and professional working with us. He never presented himself as anything other than a calm, mild-mannered business owner. Neither did she. I have nothing but kind words and memories of both."
A neighbor on the couple's street in Gold Bar said they were always friendly. Each often would stop while on a stroll to make small talk, Amanda Murray often walking her two small dogs.
When cancer invaded the man she knew as David Murray, his robust body began to wither away and he needed to use a walker to get down the street.
"He fought his cancer with every ounce of strength and dignity he had," Ruth said. "At the end it was just tough. I felt compassion for him."
A felon and prolific escape artist
In his previous life, Lilly was a felon with a long rap sheet. He was serving time for robbery, burglary, car theft and aggravated assault on a police officer.
Internet crime sleuths report that he also was a prolific escape artist. A web site for fans of "America's Most Wanted," claims that Lilly first escaped prison in 1975 by tunneling out of his cell. He was caught about two weeks later.
He reportedly escaped at least two more times in Kansas. Once he stole a prison truck and another time he and some other inmates allegedly overpowered guards in a control tower and scaled the prison walls. He was cornered several hours later and took a shot at a police officer. Lilly was moved to a maximum-security prison in Missouri.
He had been on the lam since Dec. 13, 1986. That's when he stole a prison guard's uniform and walked out of the Missouri State Penitentiary. Presumably, he met up with Mary Lilly, whom he had married two years earlier. They were pen pals who wed while he was behind bars.
Authorities believe that the pair built new identities using fake names and stolen Social Security numbers. Records show that Dennis Lilly was using a Social Security number that was issued to an Arkansas man born in 1881. His wife's belonged to an Asian man from California who was born in 1928. Court records detail a maze of false names, birthdates and addresses connected to the couple.
The FBI has been hunting Lilly for years. He's been featured at least twice on "America's Most Wanted."
A break came in the case in October when Amanda Murray filed an application with an online stock trading firm. The application was denied because her birth date and Social Security number didn't match the name Amanda Murray.
Eight months earlier, Amanda Murray had applied for a replacement Social Security card in Washington using the birth date and Social Security number belonging to Mary Lilly. That same month she officially changed her name to Amanda Murray, filling out a simple form at Evergreen District Court in Monroe.
A compliance officer at the brokerage took an interest in the denial and queried the true name associated with the Social Security number and birth date Murray provided. That led to her connection with Dennis Lilly, the fugitive.
The officer contacted an FBI intelligence analyst in Chicago, whose online research turned up evidence that Amanda Murray is Mary Lilly and that Dennis Lilly had assumed the name David Murray.
The FBI began digging deeper, using online resources to track the Murrays to addresses in Monroe and Gold Bar. It appeared, however, that the couple may have split up in the late 1990s. They had separate addresses with David Murray showing up in Everett and San Francisco.
The search also uncovered the couple's association with The Mail Station in Monroe. Amanda Murray has been listed as the owner since 2008.
Meanwhile, there was no official record of David Murray being dead. Unofficially — on Facebook — he was. A friend had posted a goodbye message and there were details announcing the date of a wake.
The FBI catches up
Last week an FBI agent visited The Mail Station. Lilly's wife was behind the counter. He confronted her, calling her Mary. She told the federal agent she hadn't been called that name in years. A nearly 30-year secret was unraveling.
He asked her where he could find Dennis Lilly. She told him that she thought he was dead. She also said she didn't want to get in trouble.
She became upset and explained that she and Lilly had separated about nine years ago and he had moved to California. He returned to Gold Bar around 2009 with the news that he was dying from pancreatic cancer. He said he wanted to be with his family. The couple has an adult daughter.
There were records that David Murray was treated for cancer in Seattle.
He stayed in a travel trailer on the property, according to neighbors. His wife told the agent that Lilly didn't want law enforcement to know about his death, which could lead to her being held accountable for helping him elude capture.
She told authorities that Lilly died sometime in June 2012. She claimed her daughter was there when he died, along with a family friend.
"Later, Amanda dug a hole in the back yard and buried Dennis after the others had departed the house," court papers said.
She told her daughter that Lilly had been cremated and his remains were in a black urn at the house. Agents spoke with the couple's daughter who denied that she was present when her father died. She said that her mother called her, saying that her father had died and his body had been removed by the funeral home.
The FBI contacted the Snohomish County Medical Examiner's Office, alerting investigators to possible remains outside Gold Bar house. Snohomish County major crimes detectives visited Amanda Murray at her business last week. She admitted again that she buried her husband in the back yard. She declined to say more and asked to speak with a lawyer.
When a reporter paid a visit to her business Wednesday morning, she politely but firmly declined to be interviewed.
Last week, detectives along with dogs specially trained to find human remains searched the property for several hours. Detectives located the remains beneath a woodpile in a shed. The skeletal remains were turned over to the medical examiner. It could take weeks for a formal identification, most likely using DNA.
"It appears that he was living an under-the-radar kind of life in Gold Bar," Ireton said.
Indeed, said Ruth, the real estate broker.
"He was hiding in plain sight," he said.
The business the couple once ran together is now for sale.
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