Monday, August 14, 2006

The "war on Christians" ...

... really is happening. But not because of us secular folks. It's being prosecuted by scumbags who claim to be Christians!

Church congregations often vulnerable to fraud and schemes
Billions of dollars turned over by the faithful lost to scam artists


Randall W. Harding sang in the choir at Crossroads Christian Church in Corona, Calif., and donated part of his conspicuous wealth to its ministries.

In his business dealings, he underscored his faith by naming his investment firm JTL, or “Just the Lord.” Pastors and churchgoers alike entrusted their money to him.

By the time Harding was unmasked as a fraud, he and his partners had stolen more than $50 million from their clients, and Crossroads became yet another cautionary tale in what investigators say is a worsening problem plaguing the nation’s churches.

Billions of dollars has been stolen in religion-related fraud in recent years, according to the North American Securities Administrators Association, a group of state officials who work to protect investors.

Between 1984 and 1989, about $450 million was stolen in religion-related scams, the association says. In its latest count — from 1998 to 2001 — the toll had risen to $2 billion. Rip-offs have only become more common since.

Cases in recent years show just how vulnerable religious communities are and Chuck Crites, a former member of Crossroads Church, learned firsthand how effective con artists can be.

The businessman was swindled out of $500,000 by Harding in a Ponzi scheme, which uses money from newer investors to pay off older ones.

Crites said Harding, who pleaded guilty last year to wire fraud and money laundering, boasted about helping fund a new Christian high school for Crossroads and hired a music pastor from the megachurch as a sales agent. “At one point he even told me how much money he had given to the church that year,” Crites said.

Lambert Vander Tuig, a member of Saddleback Church in Lake Forest, Calif., ran a real estate scam that bilked investors out of $50 million, the Securities and Exchange Commission says. His salesmen presented themselves as faithful Christians and distributed copies of “The Purpose Driven Life,” by Saddleback pastor Rick Warren, according to the SEC. Warren and his church had no knowledge of Vander Tuig’s activities, says the SEC.

At Daystar Assembly of God Church in Prattville, Ala., a congregant persuaded church leaders and others to invest about $3 million in real estate a few years ago, promising some profits would go toward building a megachurch. The Daystar Assembly was swindled and lost its building.

And in a dramatically broader scam, leaders of Greater Ministries International, based in Tampa, Fla., defrauded thousands of people of half a billion dollars by promising to double money on investments that ministry officials said were blessed by God. Several of the con men were each sentenced in 2001 to more than a decade in prison.

“Many of these frauds are, on their face, very credible and legitimate appearing,” said Randall Lee, director of the Pacific regional office of the SEC. “You really have to dig below the surface to understand what’s going on.”

“The size and the scope of the fraud is getting larger,” said Patricia Struck, president of the securities association and administrator of the Wisconsin Department of Financial Institutions, Division of Securities. “The scammers are getting smarter and the investors don’t ask enough questions because of the feeling that they can be safe in church.”

Typically, a con artist will target the pastor first, by making a generous donation and appealing to the minister’s desire to expand the church or its programs, according to Joseph Borg, director of the Alabama Securities Commission, who played a key role in breaking up the Greater Ministries scam.

If the pastor invests, churchgoers view it as a tacit endorsement. The con man, often promising double digit returns, will chip away at resistance among church members by suggesting they can donate part of their earnings to the congregation, Borg says.

“Most folks think ‘I’m going to invest in some overseas deal or real estate deal and part of that money is going to the church and I get part. I don’t feel like I’m guilty of greed,’ ” Borg says.

If a skeptical church member openly questions a deal, that person is often castigated for speaking against a fellow Christian.

Ole Anthony of the Trinity Foundation Inc. in Dallas, which investigates fraud and televangelism, partly blames the churches themselves for the problem. Anthony contends the “prosperity gospel” — which teaches the truly faithful are rewarded with wealth in this life — is creeping into mainstream churches.

Harding was nabbed with the help of Barry Minkow, who was himself convicted of fraud years ago. Minkow eventually became a pastor in San Diego and started the Fraud Discovery Institute, which is dedicated to investigating scams.

Crites is putting his money toward a new fraud-awareness kit for churches and other groups that Minkow is developing.

“It made me angry at how people are abusing the trust that exists in church communities,” Crites said.

Investigators say all denominations are at risk, but the most susceptible communities are ones where members are deeply engaged in church activities, such as service programs and small group prayer, giving con artists plenty of chance to ingratiate themselves.



Blogger kelley b. said...

The Faithful are eaten by the Faithless in the guise of the Holy.

The real bloodsucking vampires aren't killed by the Cross, they're actively looking for victims to hang on it.

Sunlight doesn't bother 'em. Hell, they're down on the beach with a great good Righteous tan.

8/14/2006 10:25 PM  
Blogger beepbeepitsme said...

Welcome to the new blogroll :)

8/29/2006 2:35 AM  
Blogger beepbeepitsme said...

Welcome to the new blogroll :)

8/29/2006 2:35 AM  
Blogger MichaelBains said...

Holy Smoke 'n' Mirrors! You mean their faith didn't protect 'em from teh sheople shepherds?


And I thought my 401K was risky...

8/31/2006 11:07 AM  

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