How a Church Leader Deceived His Church Out of $3,000,000

When sacred trust is shattered, what remains for the faithful? In our latest episode, we unravel a disturbing saga of deceit within a church's walls, where a leader's so-called divine revelation paved the way for a massive cryptocurrency fraud. You'll gain insight into the complex interplay between faith and financial stewardship, as we discuss the critical need for accountability. Walk with us through the aftermath of a spiritual betrayal that cost the congregation three million dollars, and discover the six key steps we propose to prevent such catastrophes within any faith-based organization's financial practices.

This conversation goes beyond the headlines, probing the delicate fabric of credibility that once torn, can be difficult to mend. Our focus shifts to the proactive measures necessary for maintaining the integrity of religious institutions, ensuring that leaders embody the virtues of honesty and transparency. We tackle the vital topic of establishing robust checks and balances to guard against moral failures, ensuring future generations can place their trust in those appointed to guide them spiritually. Join us for a poignant reflection on leadership, accountability, and the healing power of truth in the face of deception.

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Transcript

Speaker 1: 0:09

How in the world does a church leader deceive his church out of three million dollars? Let's talk about it. Thanks for joining me. I'm Todd Rhodes and you are listening to the Healthy Church Staff Podcast. Thanks so much for joining us.

Speaker 1: 0:26

Why in the world would I even be talking about this story? It's an outlandish story. It's one of those stories that you read and you think that could never happen. It could never happen in my town or my church, and it's such a bad story that you think why even give it any air right, why talk about it? I'm a firm believer that when bad things happen, there's probably something that we can learn from it, so that's really what I wanted to talk about today.

Speaker 1: 0:53

One of the most unsettling stories that I've at least monumental as far as financial kind of ripoffs that I've seen in recent years is a church leader. I'm not even going to mention where he's from, but it's here in the States. I'm not going to mention his name or his church, but he's accused of embezzling three million dollars three million dollars from his own congregation. And here's how he did it. It has to do with cryptocurrency and all that, and I don't know if that makes that big of a difference, but that's how he did it. That's the method that he used. But really what he did is he portrayed this investment into this crypto coin as God's plan and he promised his congregation 10X returns. And he used religious language to manipulate. And you might say people were just con. People were naive, but people look up to their leaders.

Speaker 1: 1:52

Yesterday we talked about credibility and how a lot of people in our culture don't think anymore that pastors are above reproach. This is a pastor. This is a great example of yesterday's podcast. Go back and listen to it if you missed it. This is a great example of how a pastor can lead people astray, lose their credibility and just incredible damage was done. So here's what he did. He told people hey, this I've heard from God. That's kind of crisis area number one. He'd heard from God and that God told him that if everyone would just invest their money and if the church would invest their money into this crypto coin, that they would get at least 10% back.

Speaker 1: 2:41

Deal is, people gave $3 million to this to buy this crypto coin, which eventually tanked, after, of course, the pastor's wife took most of the funds out, or a lot of the funds. And here's the kicker, and you probably know this is coming right. What did the pastor and his wife use the funds for? Pretty extravagant purchases and lavish personal expenses. They remodeled. The pastor remodeled his house, but he told his personers hey, that's God told him to do this. They purchased a bunch of luxury items. They bought themselves a new Range Rover, a bunch of jewelry and, of course, you can't have a pastor scam if you don't have some purchase of some high end handbags in there somewhere. So, anyway, the impact on the church, the betrayal, left people shocked. They were in doubt, eroded trust Again.

Speaker 1: 3:38

We talked yesterday about that and it caused, really for a lot of the members of that church, I'm sure caused a real crisis, a phase like how in the world, what did I do? Why did he do that to us and why did I believe it? So here's I said I always like to look at things and try and figure out what lessons are. Here's the lesson. And this piggy backs on what we said. Piggy backs on what we said yesterday with leadership and you are in leadership If you're on a staff, you're in leadership. With leadership comes great responsibility and it's a painful. This story is a painful reminder for just the incredible need for honesty and integrity. You need to set up some safeguards. If you are a leader and you have no safeguards, if you have no checks and balances or accountability to ensure that you can't get out of control, you may get out of control. I'm sure this pastor didn't wake up one day and say, hey, I'm gonna rip off my church for $3 million, but that's where he ended up because there was no accountability. Let me give you some, quickly, some ways that you let's see two, four, six ways that you can set up some safeguards that are gonna help you, particularly in this area of financial integrity, and help you keep trust not only in yourself and your leadership, but also in your church.

Speaker 1: 5:02

First of all, segregate financial duties. Different people should be responsible for handling money, for recording transactions. This sounds elementary, but it just. Churches are so sloppy many times have different people that are reconciling your accounts, approving your expenditures, and this in and of itself, just by having different people do different things, rather than having it all done by one or two people, this is gonna create some checks and balances. So segregate your financial duties. Number two again, this sounds really simple, but require dual signatures on any checks that go out or on any large expenditures. I get it, you're not writing checks, you're paying with credit cards and all those kinds of things now, but put some safeguards in there. Checks over a certain amount could require two separate authorized signatures. I think that's wise if you're still writing large checks for things or buying purchases with checks.

Speaker 1: 5:54

Number three conduct regular financial audits. Make sure you do this with an external auditor. Yes, it costs money, yes, they're not cheap, but an external auditor can review your records annually. It will foster trust in your people and they're gonna be able to verify that you're using all the funds that come in properly and you can tell your people that you have an outside person do that. Fourth, create detailed financial reports. I guess if you don't have financial reports you're not gonna be prone to get an audit.

Speaker 1: 6:28

But again, many churches are just sloppy. Make sure, with today's computer programs and all the different budgeting software there is, this should be mandatory. You shouldn't be doing it by hand anymore. Reports should be able to track your income and your expenses and all your different account balances and measure how your spending is against your budget. You do have a budget right. Make sure your church has a budget and these should be reviewed regularly by leadership. And, yes, I think they should probably be available to members as well, just to hold accountable. Accountability is not a bad thing, all right.

Speaker 1: 7:02

Number five implement approval processes. Make sure that your reimbursements, your invoices, other payments can require written approval and that you get receipts and documentation. Make sure that, if it's every church is different, but make sure if, particularly if it's a big purchase or if it's something that could benefit the person that's buying it, there needs to be some accountability there. And then, lastly, and again, this seems really simple but secure your physical assets. Your blank checks, your offering envelopes does anybody use those anymore? Your bank cards, your credit cards, any sensitive documents need to be securely stored. That's just good common practice, okay? So here's the encouragement.

Speaker 1: 7:44

Okay, don't hear me going off and saying all leaders are doing this kind of thing. Most leaders are honest. I know you, you're probably honest, but you gotta stay vigilant. You gotta stay vigilant against manipulation. You gotta stay on guard against greed. Bad players will affect your church and they affect your reputation. Let me leave you with this. Today. Faith is a church's highest office and honesty is its greatest asset. We just have to preserve the trust. It's sacred If you haven't put any of these accountability factors in place in your church, and particularly for your leadership or your department, whichever that might be, you need to do that so that we're not talking about you on a future podcast. Okay, I wouldn't wanna have to do that, so, very good, thank you so much for joining Again. You're listening to the Healthy Church Staff podcast and join us again tomorrow. We're going to be talking about what are we talking about Tomorrow? We're talking about oh, the church is out to get me. We'll see you tomorrow. Етиcom.