State sees fraud funds; church sees donations

The lawyer for a church's leaders says parishioners were not guaranteed returns for investments, which prosecutors say fed a Ponzi scheme.

By GRAHAM BRINK

© St. Petersburg Times, published January 23, 2001

TAMPA -- Prosecutors called the program organized by Greater Ministries International church elders a classic Ponzi scheme set up to scam money from investors.

Defense attorneys countered that the money was donated by parishioners willing to open their pocketbooks to support their church and God. There was no guarantee of a financial return, they said.

So went opening statements Monday in the trial of Greater Ministries president Gerald Payne, his wife, Betty, and church leaders Patrick Talbert, Howard Eudon Hall and David Whitfield. They face 17 counts of conspiracy, mail fraud, wire fraud and money laundering. Gerald Payne also faces additional charges of purposefully evading federal financial transaction requirements.

Two other elders indicted in 1999 have since pleaded guilty, admitted that the program was a scam and agreed to help prosecutors.

"This is a case about greed," Assistant U.S. Attorney Jay Hoffer told jurors. "This is a case about fraud. This is a case about misrepresentation."

According to Hoffer and court documents, the church set up the program in March 1993. It had many names, including "Double Your Blessing Gift Exchange" and the "Faith Promises Program."

Christians across the country were told their money would double in 17 months, thanks to gold mines and other profitable overseas investments the church claimed to hold, Hoffer said.

Investors who sent in the minimum $250, for instance, would receive nothing for six months, then $50 a month for 10 months. They could then leave the money with the church to earn bigger and faster returns.

Over the next six years, tens of millions of dollars flowed through the church headquarters at 715 Bird St. near the Tampa Greyhound Track. Elders received 5 percent commissions. To keep the scheme afloat, the elders set up a fictitious bank, faked a burglary and kept quiet about the commissions, Hoffer said.

The plan crumbled in 1998, Hoffer said.

Defense attorneys did not deny the church set up a system to collect money. But they told jurors that it was given as gifts to the church and used to help the homeless, addicts and foreign ministries.

In a thundering opening statement, Talbert's attorney John Kingston held a Bible in one hand and the U.S. Constitution in the other as he accused the government of prosecuting the elders for their religious beliefs and violating their right to free expression.

"There is no fraud!" Kingston yelled. "(My client) is here because he makes them nervous."

The trial is expected to last about a month.

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