IBJNews

Investors in church-related fraud to get most of their money

Back to TopCommentsE-mailPrintBookmark and Share

Investors will get 70 cents for every dollar they invested in an $85 million Ponzi scheme operated by a fundraising branch of the Church of God.

A federal judge in Indianapolis on Monday gave final approval to the terms ending the case. As part of those conditions, U.S. District Judge David Hamilton also granted permission for properties causing a financial drain on Church of God assets to be abandoned. The case is expected to be finalized in September or October.

Court documents said the Securities and Exchange Commission filed suit against the church's prior fundraising organization in 2003, alleging it had defrauded investors who believed their money would go to church-related construction.

Instead, the judge said the leaders of the former fundraising organization used the money raised to make interest and principal payments to prior investors to cover up bad business decisions, The Herald Bulletin reported.

"It's more of the same old cliche, if you find yourself in a hole, stop digging," Hamilton said.

The 70-percent payback will go to unsecured investors. Under those terms, someone who invested $100,000 could receive about $70,000 back.

Much of the money has already been repaid. Hamilton has approved a final installment of about $750,000 before the case is closed. Any unclaimed funds would then go to the unclaimed property division of the Indiana attorney general's office.

Records show more than $73 million was recovered from the liquidation of church assets and other funding such as private contributions. However, part of that went for professional fees associated with the case.

Hamilton called the recovery of funds "extraordinary."

Frank Johnson, president of the Reconstituted Board of Church Extension, said the new fundraisers were determined to recover as much money as possible for church members who had invested their money.

"People still lost money and many will be disappointed, but we did our best," Johnson said.

Monday's final hearing allows the former organization to be dissolved and fundraising activities to continue under a new group.

The Church of God, headquartered in Anderson, has more than 2,000 affiliated congregations and more than 230,000 members nationwide. In 1921, the Church of God established the Church Extension to operate fundraising activities along with its subsidiary, United Management Services Inc., which is a nonprofit Indiana corporation.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. Gay marriage is coming, whether or not these bigots and zealots like it or not. We must work to ensure future generations remember the likes of Greg Zoeller like they do the racists of our past...in shame.

  2. Perhaps a diagram of all the network connections of all politicians to their supporters and those who are elite/wealthy and how they have voted on bills that may have benefited their supporters. The truth may hurt, but there are no non-disclosures in government.

  3. I'm sure these lawyers were having problems coming up with any non-religious reason to ban same-sex marriage. I've asked proponents of this ban the question many times and the only answers I have received were religious reasons. Quite often the reason had to do with marriage to a pet or marriage between a group even though those have nothing at all to do with this. I'm looking forward to less discrimination in our state soon!

  4. They never let go of the "make babies" argument. It fails instantaneously because a considerable percentage of heterosexual marriages don't produce any children either. Although if someone wants to pass a law that any couple, heterosexual or homosexual, cannot be legally married (and therefore not utilize all legal, financial, and tax benefits that come with it) until they have produced a biological child, that would be fun to see as a spectator. "All this is a reflection of biology," Fisher answered. "Men and women make babies, same-sex couples do not... we have to have a mechanism to regulate that, and marriage is that mechanism." The civil contract called marriage does NOTHING to regulate babymaking, whether purposefully or accidental. These conservatives really need to understand that sex education and access to birth control do far more to regulate babymaking in this country. Moreover, last I checked, same-sex couples can make babies in a variety of ways, and none of them are by accident. Same-sex couples often foster and adopt the children produced by the many accidental pregnancies from mixed-sex couples who have failed at self-regulating their babymaking capabilities.

  5. Every parent I know with kids from 6 -12 has 98.3 on its car radio all the time!! Even when my daughter isn't in the car I sometimes forget to change stations. Not everybody wants to pay for satellite radio. This will be a huge disappointment to my 9 year old. And to me - there's so many songs on the radio that I don't want her listening to.

ADVERTISEMENT