May 3, 2001 | Read Time: 2 minutes
By DEBRA E. BLUM
Five leaders of a religious organization in Florida have been convicted in federal court of conspiracy, money laundering, and fraud in one of the nation’s largest scams involving a nonprofit group.
A Tampa jury found the leaders of Greater Ministries International — Haywood Eudon Hall, Betty Payne and her husband, Gerald Payne, Patrick Talbert, and David Whitfield — guilty of running a financial scheme that bilked thousands of investors out of millions of dollars. The church officials could spend the rest of their lives in prison and be ordered to pay millions of dollars in fines. Sentencing is scheduled for June.
Two other defendants in the case, James R. Chambers and Andrew J. Krishak, pleaded guilty earlier to one conspiracy count, and Mr. Krishak testified for the prosecution. Both are scheduled to be sentenced this month.
Federal prosecutors said that from 1993 to 1999, more than 18,000 members of churches around the country put a total of $448-million into Greater Ministries financial plans, which promised to double investors’ money within 17 months. Greater Ministries said that it had investments in silver and gold mines abroad that would produce profits. Those profits, the religious organization said, would be used to pay back investors and support the ministries’ charitable and religious programs (The Chronicle, March 25, 1999).
But prosecutors said that Greater Ministries’ profit-making ventures did not exist or had failed and that some investors were repaid with money that had been given to Greater Ministries by other investors.
Prosecutors also said that Greater Ministries exaggerated the size of its assets, and that it falsely claimed that it would use a significant amount of money from its investment plans to pay for church programs, such as worldwide missionary work.
The church also did not tell investors that 5 percent of their money was paid in commissions to church officials, prosecutors said.
$353-Million in Losses
The operations began to unravel in 1998 when Greater Ministries stopped making payments to investors following the collapse of a Colorado bank where the church had held about $20-million in uninsured deposits. So far, investors have filed claims with Greater Ministries’ bankruptcy trustees for losses totaling nearly $353-million.
Lawyers for Greater Ministries’ leaders could not be reached or declined to comment.
Two years ago when the organization’s leaders first faced federal charges — a 20-count indictment that followed lengthy investigations by federal agencies and regulators in at least four states — the leaders argued that government officials had been unfairly interfering with church business. Following the verdict, Greater Ministries posted on its Web site the following message: “What a disgrace for America when the First Amendment is stomped on and disregarded like an old rag.”
