How do religious shysters build entire financial empires? Why do they get away with running obvious Ponzi schemes for years on end, while no one appears to ask them any hard questions?
Cathy Lerman, a Florida lawyer who is representing several victims of religious fraudster Ephren Taylor (sometimes dubbed “the black Bernie Madoff”), offers at least part of the answer:
“Religious-affinity fraud is quite common, but it’s not discussed inside the church, and that’s one of the problems. No one wants to admit that it occurs, and that’s how [Taylor] did this for so long. A lot of these people were ashamed, or they felt from a religious standpoint that what happens in the church stays in the church, and you don’t go telling anybody and you don’t have him arrested and you don’t do anything.”
“Who would dream that someone would come into your church and use your faith as a weapon to steal?” said Lerman. “All of them believed that they were the only ones; they thought they had been stupid.”
From 2007 to 2010, Taylor gave “Wealth Tour Live” seminars in churches around the country.
Initially, Taylor’s appeal was obvious. Marketing himself as the “youngest black CEO of a publicly traded company,” Taylor claimed to have founded two tech companies — and made his first million — before graduating from high school. He promised “low-risk, high-reward” investment opportunities that would “show you how to get wealth and use it for the building of His Kingdom,” as he told a congregation in 2009.
In sermons, and later with infomercials, books, and webinars, Taylor would rev up the flock, quoting scripture, exalting Jesus, and sprinkling vague promises of “economic empowerment” and “attainable housing” with disparaging remarks about traditional investment vehicles like stock markets and mutual funds. The audience, he claimed, would be better off “firing their brokers” and buying into one of Taylor’s “no-risk sweepstakes machines” — or, better yet, transferring their money (all of it, ideally) into self-directed IRA custodial accounts, which Taylor’s company City Capital Corporation would then invest in inner-city businesses.
Congregations, including powerful megachurches like New Birth Missionary Baptist Church in Atlanta and Joel Osteen’s behemoth Lakewood Church in Houston, ate it up, opening their doors — and wallets — to the black Elmer Gantry of the new millennium.
The man was arrested in June and faces many years behind bars. The Justice Department alleges that Taylor took in some five million dollars, always chasing new money which he used to cover his losses — that is, when he wasn’t busy secretly investing it into his wife’s fledgling career as a pop star, Kong Hee style. The Securities and Exchange Commission thinks that five million is too low an estimate and believes that Taylor defrauded his marks to the tune of 11 million dollars.
[H]is deception extended far beyond the tight circles of predominantly African American Evangelicals he targeted with his investment schemes. Taylor was profiled by CNN, Forbes, and NPR and appeared in a CNBC segment titled “Secrets of a Teen Millionaire.” Montel Williams had him on as a guest. Taylor even claimed Snoop Dogg had hired him to manage his philanthropic youth foundation, the Snoop Youth Football League. And in 2008, Taylor gave a seminar on socially conscious investment at the Democratic National Convention in Denver.
With scammers’ messages so amplified, religious groups are especially
[S]tate and federal officials have warned that about half of fraud schemes are affinity-based, accounting for anywhere between $20 billion and $50 billion in investor losses in the last decade…
Researchers at the Center for Study in Global Christianity, which examines church fraud and embezzlement, found that ecclesiastical crime accounted for $37 billion in losses for churches worldwide last year. In the US, Alabama Securities Commissioner Joseph Borg estimates that faith-based fraud accounts for about half of all affinity schemes in the South…
“It’s a big hurdle to overcome,” said Borg. “If you can’t trust your church, you can’t trust the members of your church, you can’t trust the leaders of your church, who can you trust?”
If that last sentiment is meant to refer to the basic trustworthiness of those who sell their wares dipped in Jesus juice, not even the good commissioner would seem immune to Ephren Taylor and his ilk.
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