Church Founders Handed Penalties

Tampa Tribune/August 7, 2001
By Michael Fechter

Tampa -- Defiant to the end, the ringleaders of one of the largest Ponzi schemes in American history, both in their 60s, received lengthy prison sentences Monday.

Gerald Payne, founder of Greater Ministries International Church, received a 27-year sentence from U.S. District Judge James Whittemore, who called the church's fraudulent investment program ``absolutely despicable.''

Betty Payne, the founder's wife, received a sentence of 12 years and seven months - longer than she faced before she angered the judge by repeating a declaration portraying her and her husband as victims of a zealous government.

Jurors convicted the Paynes and three others on multiple counts of conspiracy, fraud and money laundering. The church claimed international trades and lucrative mining ventures fueled a money-doubling financial program, but prosecutors proved it was a Ponzi scheme that paid established investors with money from recent investors.

Thousands of people nationwide lost huge sums of their money when the system collapsed in 1998. Gerald Payne, 65, is much thinner and walks more feebly since jurors convicted him on 19 counts March 12. He suffered a stroke, his fourth, while in jail awaiting his sentence last month, said attorney Ron Smith.

``This is the last time these two will be sitting together, the last time they'll be able to hold hands or touch each other,'' Smith said of the Paynes.

But Whittemore said Gerald Payne is a danger to the community who would commit more fraud and take more money if free. He blistered the defendant for using ``the word of God to perpetuate a fraud.''

Betty Payne, 61, is in good health and appeared headed for judicial leniency until her words prompted the judge to add 16 months behind bars.

Whittemore had just reduced her sentencing guideline based upon his finding that her role was minor compared to the other defendants. Then she read a statement, verbatim to what her husband read minutes earlier, claiming their constitutional rights were violated and their actions, all guided by the Holy Spirit, broke no laws.

The Paynes and their fellow defendants argued that a church program enjoyed First Amendment protections. Many of the program's followers harbor antigovernment beliefs and blame its collapse on government conspiracies.

``We are innocent of all charges,'' both Paynes said. The only difference in their statements came at the end. ``Glory be to God,'' she said. Smith later said he had tried to dissuade the Paynes from making such statements. ``They both feel that God will intercede,'' he said. ``And I told them both not to count on it.''

Attorney Anne Borghetti tried to minimize the harm, telling the judge that Betty Payne was under the control of other people: ``That's not her statement that she just read. She was given that by other people.'' ``That was my statement,'' her client insisted. Whittemore appeared surprised by the resistance.

``It's one thing to have blind faith,'' he told Betty Payne. ``It's quite another to cast yourself as a martyr for no apparent good. I just deliberated a matter that you could serve 33 months less. What you've just done is throw that right back in my face.''

Her sentence was 16 months longer than the sentencing guideline minimum. As much as $500 million flowed through the Tampa church during the 1990s, making it one of the largest Ponzi schemes investigated by the Internal Revenue Service. The church told investors it could double their money in 17 months or less based on biblical verse.

The Bible also contains passages pertaining to people who abuse God's words, Whittemore told Gerald Payne. ``You're going to have time to study those passages.''

Defendants Patrick Henry Talbert and Haywood ``Don'' Hall will be sentenced Wednesday. David Whitfield is scheduled for sentencing Thursday.

Greater Ministries will be presented as an example of religious fraud at a news conference today in Washington by the North American Securities Administrators Association. Officials will offer an estimate of how much money has been lost in the past three years.