Attorneys take inside look at church-run financial scheme
Investigators detail their findings inside a church's multimillion-dollar operation.
The Tampa Tribune, August 20, 1999
By Michael Fechter
TAMPA - Greater Ministries International used a church facade to cover four lucrative and possibly fraudulent business ventures, attorneys from two states say.
Thomas Krebs and John Haley, representing securities regulators from Ohio and Alabama, have been inside Greater Ministries' Sulphur Springs headquarters since winning court approval for a receiver to take over the operation on Aug. 6. They filed a court memorandum late Thursday describing what they've found inside the onetime bank building on Bird Street.
A hearing is scheduled today at 1:30 p.m. before U.S. District Judge Richard A. Lazzara.
In the memorandum, the lawyers ask the judge for an order preventing ``massive concealment, transfer and waste'' of funds, transfer of real estate holdings, and ``preferential payments to insiders and affiliates.''
Lazzara previously granted the request to name a receiver after the lawyers argued that Greater Ministries continued soliciting money for its financial program despite numerous court orders to stop and evidence that ongoing fraud was occurring.
Two weeks inside the headquarters have reinforced that belief, the memorandum says.
``At best [Greater Ministries] premises could be termed `the Church of the Folding Chairs,' because it is very evident from a viewing of the whole building that no effort was made over recent years to establish any permanent house of religious worship, and that the defendants had their operation set up to move on short notice,'' the memorandum says.
Documents and computer files discovered inside provide ``evidence that tens (and perhaps hundreds) of millions of dollars of cash and valuable property from investors and victims have passed through the hands of the defendants'' and been kept in the building's 14 safes and two vaults, the memorandum says.
Greater Ministries attorney Al Cunningham and legal assistant Barbara Ketay could not be reached Thursday.
Greater Ministries backers have held daily prayer meetings in the parking lot since being forced out of their building. Followers claim the court action violates religious freedom.
Greater Ministries had run a financial program at least since 1993. Citing biblical passages, the group said divine inspiration has guided vast international trading and mining operations that allowed it to pay a person 10 percent of their original investment back each month until it doubled.
The receiver, West Palm Beach attorney James W. Beasley, said last week that investigators inside the headquarters found no evidence of such investments and called the program a swindle.
Seven Greater Ministries associates - Gerald and Betty Payne, Don Hall, John Krishak, David Whitfield, James Chambers and Patrick Henry Talbert - face an Oct. 4 trial on federal money laundering and fraud charges.
Investigators working with the receiver found evidence that Greater Ministries ran Faith Promises, the money-doubling program, along with enterprises such as minting gold and silver coins with an artificially inflated value, a banking and trust program, and typroperty management for apparent victims, the memorandum says.
In addition to a failed 1997 attempt to buy a Broward County bank, the group tried to open banks in Liberia and Grenada, the memorandum says.
The attorneys cite passages from letters from 26 people asking about their investments.
Investor Don Kesel wrote that he invested $90,000 and was told it would double. ``We took our IRAs and cashed them in, taking a penalty to send money to Greater to also be able to have a better retirement life as suggested at one of the meetings,'' he wrote. ``We have not heard anything for many months,'' Floyd Hammer wrote in July, seeking a refund. ``This is money that we had put away for retirement and now need it very bad.''
Patsy Puckett of Alabama wrote in April that she was disabled, and when her mother died, Greater Ministries received money to provide her with extra income ``to get me out of poverty level. I have not received any money since it was put in July 27, 1998.''
While Greater Ministries calls the money ``gifts'' Krebs and Haley say a common theme in all the letters was the investors' belief that their money eventually would return to them twofold.
In an earlier affidavit filed for the receivership, a Montana woman described her November 1997 visit to Greater Ministries to invest $5,000. Patricia Staats said she was taken to ``the money room'' where she saw three people standing over a table counting a pile of $50 and $100 bills, 8 inches high and 2 feet wide.
``There could easily have been $1 million or more dollars on the table in the `money room' and $1 million in cash in each box along `the money room' wall. I estimate I saw as much as $26 million in cash in the money room,'' the affidavit said.
