Federal, state authorities crack down on operation
A year of setbacks and challenges has Greater Ministries on the ropes.
The Tampa Tribune, December 22, 1998
By Michael Fechter
TAMPA - Three states have cracked down on its financial program. A bank insolvency took more than $20 million. And for the first time, two people have said publicly that Greater Ministries International failed to deliver on its promises.
Hundreds, if not thousands, of other people haven't received routine monthly payments from the organization since summer. They don't know what to think or do.
They gave money to Faith Promises, a financial plan run by the Tampa-based Ministries. Called a gifting plan, it promises participants their money will double in 17 months.
``We think it's better than anything like the stock market or any other investment like that,'' Jeana Muir of Bakersfield, Calif., told an undercover police informant in August, ``because with the stock market, you can put your money in and you may get something back and you may not.
``I mean, most people are getting a little bit back, but they're not getting near what the Greater Ministries are giving back.''
Pennsylvania, Ohio and California have tried to bar promotion of Faith Promises during 1998. But the biggest blow came when a small state bank was closed by Colorado regulators for insolvency. The Ministries and state regulators say the organization lost between $20 million and $35 million in uninsured deposits.
It isn't clear how the Ministries found Best Bank. Previously, the organization promoted its own Greater International Bank of Nauru, a tiny island republic in the Pacific Ocean.
In February, the U.S. Office of the Comptroller of the Currency announced the Republic of Nauru had revoked the license on the Greater International Bank Corp. Bank licenses in Nauru are available through the Internet for accounts of at least $100,000 with fees as low as $15,000.
Greater International Bank offered Visa debit cards to Ministries participants. But the cards were issued by Best Bank, application forms for the cards show.
Now the Ministries is offering certificates in lieu of the cash payments participants have come to expect. The certificates, backed by gold and silver mining operations, are supposed to be redeemable in cash within 30 days.
Muir and her husband, Don, who promoted the Ministries program in Bakersfield, entered no contest pleas Dec. 11 to state charges of selling unregistered securities.
In Florida, an attorney for Jonathan Strawder, a former Ministries associate whose father and uncle remain active members, said Strawder would plead guilty to felony charges of grand theft and securities fraud following his arrest last week. Strawder created a spinoff program called Sovereign Ministries International that state prosecutors have identified as a Ponzi scheme.
Strawder's attorney, Joel Hirschhorn, has acknowledged the spinoff cited the same biblical passage as the Ministries program, used the same financial terms, and referred to international trading.
A federal investigation continues into Greater Ministries. Gerald Payne, its founder and president, has said he defied a subpoena by the U.S. Attorney's Office by purging Ministries computers. The organization also is resisting an investigation by postal inspectors.
If a Pennsylvania judge agrees with state officials, meanwhile, Payne and the Ministries will be found in contempt of court.
The judge signed an injunction in October prohibiting the group from all financial activity with state residents. A Nov. 21 meeting in Lebanon, Pa., two mailings to participants, and the Ministries' Internet site all are considered by state prosecutors to be violations of that injunction.
A court hearing on the contempt matter is scheduled for Jan. 20.
