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Probe into Lyons' finances hits snag


©St. Petersburg Times, published January 23, 2006

LOS ANGELES -- In another show of support for its embattled leader, the National Baptist Convention USA Inc. has rejected a request from Florida prosecutors to meet with the convention's accountants.

Instead, the convention board voted "to stand in support of Dr. Henry J. Lyons as president until the complete and final closure" of state and federal criminal investigations into Lyons' financial dealings.

The vote came late Wednesday after Grady Irvin, an attorney for Lyons, urged the board not to let prosecutors meet with the convention's accountants.

"I know we don't have anything to hide," Irvin said. "But it's a matter of principle. People will walk over you if you let them."

In a letter last month, Pinellas-Pasco State Attorney Bernie McCabe's office asked to meet with the Nashville, Tenn., accounting firm Marlin & Edmondson, which audits the convention's finances each year.

"We view the convention as one of several victims of crimes being investigated by this office," the letter states.

"It was a courtesy letter we wrote," Assistant State Attorney Bill Loughery said Thursday. "We were given the impression from the (convention) lawyers that it wasn't going to be a problem. Apparently, the NBC doesn't want to be agreeable to that. We'll have to take alternative steps."

It is unclear what those steps will be.

Under state law in Florida and Tennessee, accountants cannot be compelled to disclose their communications with clients, convention attorney Bruce Howie said.

"I just can't go around talking to whoever calls," agreed Joe Edmondson Jr., the convention's primary accountant.

But Edmondson said he is obligated by law to comply with subpoenas from federal prosecutors.

What about subpoenas from state prosecutors in Florida?

"I just don't know," he said.

One possible reason prosecutors would be eager to talk to Edmondson is that his firm's 1996 audit of the convention doesn't mention the Baptist Builder Fund, a secret account Lyons kept at a St. Petersburg bank. Lyons deposited hundreds of thousands of dollars from the convention into that fund. He also used the fund for personal purchases.

Lyons recently pledged the Baptist Builder Fund would be subject to a full audit, but Edmondson said his firm has yet to receive all the fund's records. Nor has the firm completed its audit of the convention for the fiscal year that ended June 30.

"We don't have complete information . . . on a lot of different (convention) funds," Edmondson said.

The convention's winter board meetings, which began Monday and ended Thursday, were closed to the public, but tape recordings of the proceedings were on sale in the lobby of the Biltmore Hotel.

A review of the tapes shows:

Lyons said he has not used any convention money on his legal defense. Instead, a Cincinnati pastor is asking convention members to donate to a special account he opened for Lyons. So far, $55,000 has been contributed.

Irvin said Lyons will need even more money if he is charged with crimes.

"It's going to be six figures, I'll tell you that right now," he said, adding, "I don't want you to be surprised if you pick up the paper one day, and they say Henry Lyons has been arrested, taken off to jail in handcuffs."

Irvin later said, "Our president shouldn't be indicted, but if he is, you know, sure better be some black folks on that jury. You know, I thought they stopped hanging people before all-white juries a long time ago."

Irvin told the board he went to Washington, D.C., this month to meet with Justice Department officials investigating Lyons' relationship with the government of Nigeria. The African nation paid Lyons $350,000 at a time when he was urging lawmakers to soften the U.S. government's Nigerian policy. Lyons did not register as a lobbyist, though federal law required him to do so.

Irvin said he told a Justice Department lawyer: "I got bigger things to deal with than Nigeria. He said, "I agree with you, Mr. Irvin.' "

Irvin continued, "One country lawyer had a conversation with another country lawyer, and we ended up talking about basketball. That's how important it was."

Marshall Williams, head of the Justice Department's Foreign Agents Registration Unit, confirmed that he met with Irvin for 30 minutes at Irvin's request.

"I can't say anything about a matter that is unresolved," he said.

Irvin defended Lyons' behavior when Anti-Defamation League officials discovered that Lyons had failed to distribute $214,500 they had raised and entrusted him to distribute to burned churches across the South.

"The minute the ADL said, "We want our money,' guess what? The president wrote them a check," Irvin said. "Then they wanted a whole lot of explanation. I ain't got to explain nothing to them."

Irvin then criticized the league for what he said was the group's slowness to distribute the money Lyons sent back.

"I understand they're just getting ready to disburse it. And this is, what, five months after they got it back?"

Told of Irvin's comments, Anti-Defamation League officials expressed disbelief.

"That is totally outrageous, not to mention false," said Jill Meltzer, corporate counsel for the league. Lyons' repayment check arrived at the league headquarters Sept. 16, she said. By Dec. 15, the money had been handed out to eight needy churches in as many Southern states.

By contrast, she said, Lyons held on to most of the money for 10 months before returning it undistributed. Anti-Defamation League officials still have received no explanation of what Lyons did with that money in the months he had it.

"We've given up on that," Meltzer said. "That is for law enforcement to determine now."

ADL officials, who have met with state law enforcement officials, were contacted by federal agents this month.

"We are cooperating with the FBI."

Lyons released a report of the convention's finances for the second half of 1997 showing the organization had $4,955 in the bank as of Dec. 31.

The organization spent about $1.8-million during the six months, including $117,000 on black colleges and $20,000 on its religious missions. It spent more than both of those combined -- $165,000 -- on "entertainment" for its annual meeting in Denver last fall.

©Copyright 2006 St. Petersburg Times. All rights reserved.