Ministries founder held in fraud case

The leader of an investment plan rooted in religious dogma is arrested in connection with a $13 million Ponzi scheme.

The Tampa Tribune, December 16, 1998
By Michael Fechter

ORLANDO - Jonathan Strawder is going to prison for promising people he'd better than double their money in a financial scam that mixed faith with greed.

Strawder, founder and operator of Sovereign Ministries International, a religious-based investment program, surrendered Tuesday to the Florida Department of Law Enforcement after reaching a plea agreement on charges of grand theft and securities fraud. He has family ties to Greater Ministries International, a similar Tampa-based program that is under federal investigation as a possible Ponzi scheme.

Strawder worked at Greater Ministries International, and there are many similarities between the two programs. Strawder's father and uncle are active members of Greater Ministries.

Investigators suspect Greater Ministries also is a Ponzi scheme worth much more, and Strawder's plea agreement could be ominous.

``Clearly, it's a spinoff'' of Greater Ministries, Strawder's attorney Joel Hirschhorn said.

Strawder and his associates promised astronomical returns that he said could be generated through offshore trading. The trades never existed.

Like Greater Ministries, Sovereign cited the biblical passage Luke 6:38 in its literature. It included similar language in its sign-up sheets and had the same nomenclature for financing.

Like Greater Ministries, investments in Sovereign were called gifts. Interest was called a blessing or increase and money rolled over was considered a re-gift.

``The program as promoted by Strawder is a `Ponzi' scheme where new investor money is used to pay back earlier investors,'' investigator Roger Handley of the state comptroller's office wrote in his arrest affidavit.

Strawder, 26, incorporated Sovereign Ministries International in May 1997, less than two months after a state appellate court ruled that money collected by the Greater Ministries program was not a financial security subject to state regulation, but a religious donation.

Sovereign Ministries took in $13 million from about 2,100 people between May and December last year. Witness statements indicate that by January, Strawder was telling his sales associates the books were ``upside down,'' with only $8 million left to repay $13 million owed, plus interest.

Greater Ministries' financial program has existed in various forms for at least six years and is believed to have tens of thousands of participants who have put in hundreds of millions of dollars.

``Greater Ministries has been around a long time,'' said Assistant Statewide Prosecutor Thomas A. Sadaka. ``What I have seen of Greater Ministries, it is a classic Ponzi scheme.''

Neither he nor Hirschhorn would comment on whether Strawder also has cooperated with the U.S. attorney's office investigation of Greater Ministries. Strawder could be sentenced to five years in prison under the terms of a plea agreement.

Strawder used some of Sovereign's money on such things as a boat, a motorcycle, two Porsches, a Lexus and a Land Rover.

Most of the assets have been sold off and given to a receiver, Hirschhorn said. Victims can expect to see at least half their money back, he said.

``Jon is very charismatic and very naive. He was misled when he got out of college by people he loved and trusted.''

Sadaka also described Strawder as charismatic and well versed in Scripture, something that helped him engender trust among the people he solicited. Associates who peddled the program, who called themselves ambassadors, still could be charged with related crimes, Sadaka said.

Strawder's uncle, Louis Strawder, is among Greater Ministries' founding directors. His father, Ed Strawder, also is active with Greater and attended a meeting of Sovereign ambassadors in the Bahamas, where he described the investing and trading he was supposed to be doing to generate income and pay interest to Sovereign participants.

Tuesday's plea is the third in a week from people in and around Greater Ministries. In Bakersfield, Calif., representatives Don and Jeana Muir entered no contest pleas Friday for selling unregistered securities. The couple was responsible for $100,000 in cash to Greater Ministries.