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Government sums up case against church
By JEFF TESTERMAN © St. Petersburg Times, published March 7, 2001 TAMPA -- A federal prosecutor told jurors Tuesday that a faith-based investment program run by Greater Ministries International was a carefully disguised pyramid scheme that took parishioners for millions. The Tampa-based church's promise that cash gifts from the faithful would be doubled within 17 months through investments in gold, platinum, diamonds, oil and foreign banks was "an illusion, a sham, a fraud," said Assistant U.S. Attorney Robert Mosakowski. "It was an incredible combination of God and mammon." Mosakowski's comments came in closing arguments following the seven-week trial of Greater Ministries president Gerald Payne, his wife, Betty, and church elders Patrick Talbert, Howard Eudon Hall and David Whitfield. Indicted in March 1999, the five face 17 counts of conspiracy, mail fraud, wire fraud and money laundering. They are accused of cheating church members through an investment plan called "Double Your Blessing Gift Exchange." Gerald Payne is charged with additional counts of trying to evade currency transaction requirements stemming from the discovery that he cashed more than $1.5-million in checks in $9,000 increments in 1993 and 1994. According to testimony, Greater Ministries took in $448-million from members from 1993 until seeking protection in 1999 under Chapter 11 of the U.S. Bankruptcy Act. By then, records showed the church had just $10-million in assets and $190-million in claims from unhappy investors. Prosecutors say Payne and the others ran a classic Ponzi scheme, where payments to initial investors were made from funds sent to the church by later waves of investors. Prosecutors say elders collected 5 percent commissions, called "gas money," for recruiting new investors. The incentive program was so successful that church leaders capped gas money payments at $40,000 a month, yet still paid out a total of $22.4-million in commissions. Mosakowski said Greater Ministries dealt almost exclusively in cash, and went to extraordinary lengths to conceal paper trails. He said church leaders used a series of falsehoods to convince members that offshore investments were genuine and that profits were pouring into "good works" missionary projects. In fact, Mosakowski said, most of the investments were "cockamamie" failures, and the money reported spent on mission work was "greatly exaggerated." Prosecutors say the Greater Ministries scheme collapsed in 1998 when Colorado regulators seized the Best Bank of Boulder, where the church had stashed $20-million in a checking account. Ronald Smith, the attorney for Gerald Payne, told jurors Tuesday that the Greater Ministries trial was "a trial on religious beliefs." He said defendants merely followed the scriptural dictate in Luke 6:38 ("Give and it will be given to you ... with the same measure that you use, it will be measured back to you."). While Gerald Payne traveled widely, developed a friendship with Liberian President Charles Taylor and had $8-million in investments in the African country, Smith said, he enjoyed no lavish lifestyle afforded by fraud. Instead he "bought his clothes at Goodwill" and lived "in a trailer." Moreover, Payne refused to seek sanctuary in Liberia even when confronted with the probability of a grand jury indictment, Smith said. "If he was a fraud, don't you think he would have grabbed the money and split?" the attorney asked jurors. "Don't you think he could have hid out in Liberia rather than come back to this?" Closing arguments will continue today.
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From the Times |
