Judge halts `Faith Promises,' gives receiver Greater Ministries control

A permanent injunction effectively ends a church's money doubling financial program.

The Tampa Tribune, August 21, 1999
By Michael Fechter

TAMPA - A federal judge on Friday placed a permanent injunction on a church-based financial program that took at least $100 million from 15,000 investors nationally.

Greater Ministries International Church's ``Faith Promises'' program is defunct, said Alabama attorney Thomas Krebs, who helped secure a court-appointed receiver earlier this month.

The church's lawyers vowed to appeal They rest their argument on the First Amendment and religious doctrine - that Jesus Christ is sovereign and that places their church outside secular authority.

``If we recognize a sovereign greater than Jesus Christ, then we deny Jesus Christ,'' attorney Al Cunningham said.

The argument bewildered U.S. District Judge Richard A. Lazzara who wondered aloud what secular authorities do when religious groups break the law.

He peppered Cunningham and a church pastor with pointed questions that left some church supporters grumbling.

``He acted more like a prosecutor than a judge,'' one woman said after the hearing.

When Pastor Charles Strickland testified that Greater Ministries never guaranteed anyone a profit from their program, Lazzara produced a letter from an Ohio resident saying Strickland had done just that.

The man lied, Strickland said.

The man gave his money directly to Strickland and says he lost more than $2,000 in the program in which donors were assured they would get back double their money in 17 months.

``What did you do with the money he gave you?'' Lazzara asked. ``You were the steward.''

Strickland said he gave the money to the church.

At a different point, his voice raised, Lazzara asked ``Who punishes the corrupt steward?''

Strickland repeatedly cited scriptures as the justification for the financial program, which prosecutors say is a Ponzi scheme.

``God expects his people to be givers and he expects us to do what we can to help other church people,'' Strickland said.

Who in this life, Lazzara wondered aloud, punishes those who use that tenet for ill-gotten gain?

He cited case law from the U.S. Supreme Court and the 11th Circuit appellate court saying the state has a duty to protect people from fraud under the cloak of religion.

``I recognize your argument,'' Lazzara said. ``The law of the United States Supreme Court and the law of the 11th Circuit Court seems to be at odds with the argument you are making.''

Cunningham denied that Greater Ministries engaged in fraud and said the church can distinguish itself from the case law, involving the Church of Scientology and Jehovah's Witnesses.

He pledged to appeal the ruling to the 11th Circuit.

``The Lord Jesus Christ regulates our body,'' Cunningham said. ``That's the First Amendment.''

Strickland's testimony ended with him invoking his Fifth Amendment right against self incrimination in response to a series of questions about his role as a courier of money to the program and whether he profited by it.

He is not named in a 20-count federal indictment charging money laundering and fraud. Seven Greater Ministries leaders, including founder Gerald Payne, his wife, Betty Payne, and Pastor Don Hall, are scheduled to go on trial Oct. 4.

Friday's ruling cements a temporary injunction Lazzara issued Aug. 6 without Greater Ministries' knowledge. Armed U.S. Marshals seized the building, which now is guarded by off-duty Hillsborough Sheriff's deputies.

A court-appointed receiver is charged with securing the program's records and assets to try to return money to investors.

The receiver, West Palm Beach attorney James W. Beasley, told the court he may seek bankruptcy protection for Greater Ministries.

He called it a Ponzi scheme, a fraud in which money from newer investors is used to pay earlier investors. Such schemes ultimately collapse when the volume of money coming in can't keep pace.

Beasley said he's found no evidence of legitimate investments by Greater Ministries. Investigators working with him did find computer records and mailing lists indicating at least 15,000 people outside Greater Ministries put in ``$100 million and could be substantially larger'' sums.

While a pledge form stated that participants received no guarantees of a return, the states' lawyers offered transcripts, affidavits and videotaped evidence that the verbal pitch set out specific timetables and assurances that no one had lost money.

J. Michael Rediker, who along with Krebs has been deputized as a special assistant attorney general in Ohio and Alabama, told the court that investigators found stacks of envelopes filled with gold and silver coins that Greater was preparing to send investors.

Documents in the envelopes valued the coins at $20 to $30, but the true value is closer to $3, Rediker said. In addition, it appeared the group was destroying bookkeeping records.

``There are shredders all over that building,'' Rediker said.