Its bankruptcy late in 2001 caused about 4,000 employees to lose their jobs, while stock losses wiped out their retirement savings and prompted many business reforms. In 1948, the Baptist Foundation of Arizona was founded in 1948 and initially sought to provide a financial revenue for participants while supporting Baptist-motivated causes. All eyes are on Houston this week, as jury selection gets underway for the long-awaited criminal trials of former Enron leaders Kenneth Lay and Jeffrey Skilling on charges of corporate fraud. Since August, the foundation has fired its top three officials, severed ties with the law and accounting firms with which it had worked, laid off 72 of its 127 employees, and closed its two branch offices. The new company will, like its not-for-profit predecessor, invest its assets in real estate, venture-capital deals, and some equities. Market data provided by Factset. The BFA began marketing individual funds, often in churches, telling prospective investors their funds would be safe, yield high returns and help strengthen Southern Baptists in the state. 'cag[attribution_source]' : 'CNBC US Source' , What clues did the In the decade since Vasquez's appeal for help, more than 250 people who worked or volunteered in Southern Baptist churches have been charged with sex crimes, an investigation by the Houston . April 1998 The Phoenix NewTimes, a tabloid, accuses the BFA of many financial irregularities that threatened the foundations stability. } return false; Solely for the purpose of determining whether a transfer or ac- [11] Independent of the abuse of process ruling, the original Arizona Superior Court ruling was upheld by the Arizona Court of Appeals in March 2005, at which point National Union paid the $2.5 million to Grabinski. 'subtype' : 'primetime_show' , "host" : 'mps.cnbc.com', Its an investment scam, yes, Mr. Nelson says, but because it is a religious organization, it only fuels stereotypes about taking advantage of people based on their faith.. First case: The Baptist Foundation of Arizona invests and loses millions entrusted by churchgoers, and its mission ends in scandal. Baptist Foundation indictments thrown out. 'byline' : 'Stacy Keach' , A new management committee of Joe Panter, Mark Roberts and Mark Dickerson is installed. Who We Are; The Team . } else { Thus, when people tried to sell it they could not because they did not own anything. Profits from investments were supposed to be used to fund the churches' ministries and numerous charitable causes. 'is_content' : '1' , regardless of past experience with the entity or prior beliefs about managements A jury on Monday found former foundation president William Crotts guilty of three counts of fraud and one count of illegally conducting an enterprise, according to the Arizona Attorney General's Office, which prosecuted the case. About 11,000 investorsmany of them elderly members of Baptist churches in Arizona and elsewherelost more than $550 million. Login Here. As for how Southern Baptists in Arizona and elsewhere will emerge from the mess created by the foundation, Bill May, president of the Arizona Church Growth Board, a unit of the state convention, says this: Its like family. is an increased emphasis on professional skepticism. Investors Lost Millions in Church Fraud Executives Sentenced. Editor: document.addEventListener("DOMContentLoaded", function(event) { var _qs = window.location.href; Click the link below to sign up for updates from Good Faith Media via our daily or weekly e-newsletters. const matches = oneTrustCookie.match(COOKIE_REGEX); The settlement also would have been the second largest ever paid by a Big Five accounting firm to settle litigation not associated with the savings & loan crisis. The Baptist Foundation of Arizona was founded in 1948 to raise money to back up Baptist causes and to pay a return for investors. Both ALO and New Church Ventures or subscribe. mps.response.dart.adunits[i].data = ''; [5], The BFA sold certificates of deposit that were non-refundable during the life of the CD. Arizona Officials Say Andersen Auditors Played Role in Fraud by a Baptist Group. Wednesday, June 10, 2009. from the Baptist Foundation Fraud. Anderson asked for the documents and BFA officials refused to provide them. with a questioning mind, recognizing the possibility that fraud may be present, } } He is pastor of Faithful Word Baptist Church, an anti-LGBTQ hate group in Tempe, Arizona. A Division of NBCUniversal. [15] At the time, this settlement was the second largest settlement in the nation's history for a Big Five accounting firm that was not related to the Savings and Loan collapses of 1986 to 1995. } [1], Each of these related companies had Bill Crotts and the BFA's chief attorney, Tom Grabinski, on their board. } real estate properties were ALO and New Church Ventures. console.log('PUB-GDPR-CHECK oneTrustCookie matches: ', matches); Yet, in 2002, years after the BFA . But the foundation has operated independently of the convention, and state regulators say it is unlikely that the statewide group would be held liable for the foundations actions. (function(){ These. Investors who choose to roll their money into securities may be risking even bigger losses. Superior Ct. Maricopa County, CV 2002-005117. they use. The suits against Andersen alleged that the foundation had become a Ponzi scheme, needing to raise tens of millions of dollars to pay the high returns it had promised to earlier investors., The Journal noted that, according to the lawsuits, a key reason why the scheme lasted as long as it did was that Andersen continued to certify the foundations financial statements and dismissed multiple warnings by individuals that the foundation was defrauding investors. 30. const ONE_TRUST_COOKIE_NAME = 'OptanonConsent'; } same time, it accelerated its efforts to sell IRA-type retirement investment Sept. 22, 1999 Former BFA director James Cook files a lawsuit against BFA in Maricopa Superior Court. This settlement takes on a sad historical significance The entities had no employees of their The U.S. Supreme Court overturned Andersens conviction in 2005, but it is unlikely the nearly defunct company will ever recover as a respected business. Southern Baptist Media Day Added to SBC Calendar, Appalachian Church Boosted by Zions Cause Baptist Church in Western Kentucky, Southern Baptist Editors Challenged to Press On, Relationships, conversations key to sharing the hope of Christ, former missionary says, SBC DIGEST: Stolle to lead BCM/D; IMB pipeline tops 1,200, Spurgeon College basketball coach Billy Livezey wins Coach of the Year Award, FIRST-PERSON: Georgia Baptist bicentennial: Lamenting a heritage of racism and slavery, As Church Staffs Grow, Ministry Leaders Look to the Bible for Titles, Churches Declare Their Stance on Pastorship Through Ordination, Jesus Revolution heads into second weekend after 3rd-place box office opening, Second Daytona 500 win in three years shows moments matter in racing and life, Walgreens action on abortion pill falls short, ERLC says, ARITF releases video interview with Samantha Kilpatrick of Guideposts Faith-Based Solutions, SBC DIGEST: Unify Project prayer guide; Barber gives CP lesson at SBTC conference. Baptist Group Ex-Leaders Guilty of Fraud. Its only significant asset was 1,357 acres of undeveloped land in San Miguel County, New Mexico. On this Wikipedia the language links are at the top of the page across from the article title. Essentially, in a transaction that favored a former director, the BFA accepted a piece of property (which the BFA itself declined to purchase) as collateral for a loan that amounted to US$4.9M more than the property's appraisal value. Site by Mere. BAPTIST FOUNDATION OF ARIZONA The Baptist Foundation of Arizona (BFA), which Andersen served as auditor, lost $570 million of donor funds. When the BFA filed for bankruptcy in 1999, it had $530 million in liabilities as compared to a reported $70 million in assets. Aug. 11, 1999 The Arizona Republic reports the foundations funds have been frozen as a result of the investigation. New Era, which solicited investments largely from Christian institutions, folded in 1995 after taking in about $350-million in what had amounted to a Ponzi scheme. was used to pay interest on old money. In one year, there was an amazing increase in the a sobering reminder to auditors that it is important to understand the causes In his resignation letter, Tresch told BFA officials they have placed themselves in a position of civil and criminal liability. A former BFA director }; Aug. 27, 1999 A class action lawsuit filed by investor Franklin Kestner Sr. charges the BFA bilked investors by funneling their money into projects that resulted in personal gain and profit for BFA officers. The New Independent Fundamental Baptist Movement (New IFB) was spearheaded in part by Steven Anderson, another well-known anti-LGBTQ pastor. (Phoenix, Ariz. - June 10, 2009) Attorney General Terry Goddard today announced that the Arizona Court of Appeals has upheld the convictions and sentences of former Baptist Foundation of Arizona executives William Crotts and Thomas Grabinski. When Aug. 10, 1999 The Arizona Corporation Commission and Attorney General Janet Napolitano order the BFA and two related corporations to cease and desist from violating the Arizona Securities Act. "[1] Since he was working for both companies, Grabinski was able to authorize questionable transactions. operations from collapsing was a constant influx of new investor money that Meanwhile in Phoenix, another trial with many similarities quietly entered its 17th week. Hunsinger subsequently used the property as collateral to obtain a US$6.8M loan from the BFA. Founded in 1948, BFA was created as a nonprofit agency of the Arizona Southern Baptist Convention. In order to remove those loans from its books, the BFA secretly funneled money to a subsidiary. 'cag[type_creator]' : 'Stacy Keach' , } } Another pastor, Manly Perry of Old Path Baptist Church in San Antonio, Texas, posted a video Nov. 19 distancing himself from the New IFB. "These verdicts are a victory for thousands of victims who believed the promises made by the defendants," Attorney General Terry Goddard said in a statement. const EEA_REGION_COUNTRY_CODES = ['AT', 'BE', 'BG', 'HR', 'CY', 'CZ', 'DK', 'EE', 'FI', 'FR', 'DE', 'GR', 'HU', 'IS', 'IE', 'IT', 'LV', 'LI', 'LT', 'LU', 'MT', 'NL', 'NO', 'PL', 'PT', 'RO', 'SK', 'SI', 'ES', 'SE', 'CH', 'TR', 'GB']; Redirecting. 'site' : 'cnbc-mobile' , Southern Baptist Media Day Added to SBC Calendar, Appalachian Church Boosted by Zions Cause Baptist Church in Western Kentucky, Southern Baptist Editors Challenged to Press On, Relationships, conversations key to sharing the hope of Christ, former missionary says, SBC DIGEST: Stolle to lead BCM/D; IMB pipeline tops 1,200, Spurgeon College basketball coach Billy Livezey wins Coach of the Year Award, FIRST-PERSON: Georgia Baptist bicentennial: Lamenting a heritage of racism and slavery, As Church Staffs Grow, Ministry Leaders Look to the Bible for Titles, Churches Declare Their Stance on Pastorship Through Ordination, Jesus Revolution heads into second weekend after 3rd-place box office opening, Second Daytona 500 win in three years shows moments matter in racing and life, Walgreens action on abortion pill falls short, ERLC says, ARITF releases video interview with Samantha Kilpatrick of Guideposts Faith-Based Solutions, SBC DIGEST: Unify Project prayer guide; Barber gives CP lesson at SBTC conference. As a nonprofit company, ALO filed its financial statements each year with 'stitle' : 'Religious Prey | Dr. Mikos: American Greed 5' , It also says that the foundations operating overhead was maintained at excess levels and that it engaged in costly transactions with insiders. All rights reserved. Two of the most significant entities set up to hide BFAs nonperforming [14] Christianity Today reported that the timing of this court approved settlement avoided "the worst case scenario for Baptist Foundation investors" of Andersen being convicted in its then ongoing criminal case regarding its audits of Enron, then quickly filing "for bankruptcy-court protection" from any civil lawsuits not yet settled in a court. It expects that its preferred stock will start paying annual dividends of 6 per cent by 2002. or redistributed. Oct. 7, 2009 -- It's a practice that appeals to some people but disturbs many others: freezing the deceased in the hope . Under William Crotts's leadership, the foundation engaged in a major strategic shift in its operations. })(); have a responsibility to expand their work to obtain independent corroborating SOCIAL_MEDIA: 8 This page contains information The Cult Education Institute has gathered. One of the key provisions of SAS 99 script.setAttribute("async", true); Sept. 20, 1999 Pastor Richard A. Kimsey amends his lawsuit against BFA to include the Arizona Southern Baptist Convention and Steve Bass, executive director treasurer of the conventions Executive Board. between the foundation and these corporations were designed to achieve the It filed for bankruptcy in 1999 after many of the foundation 's executive had been convicted of condemnable charges or indicted for fraud. Some Baptist leaders worry that fund-raising efforts by Baptist agencies and local churches may be hampered not only by ill will created by the foundations troubles, but also simply because some donors will not have money to give. All rights reserved. function isOneTrustAnyBlocked() { auditors overlook? Lessons Last July, two executives from the Baptist Foundation of Arizona were convicted of fraud and racketeering after more than 11,000 investors lost more than $550 million perhaps the largest case of Christian fraud in American history. Buckner also used Anderson and turned the information over to the firm. and evaluating audit evidence should lead to a revitalized accounting culture. }; Several accountants and one attorney became concerned enough to approach senior management about ALOs deficit. The foundations statement also acknowledges past wrongdoing, saying that the organization concealed money-losing investments by transferring them to affiliated companies. Second, 2023 Southern Baptist Convention. PHOENIX Two former executives of the Baptist Foundation of Arizona, which collapsed in what has been called the largest nonprofit bankruptcy filing in the nation's history, have been convicted of fraud. The real estate market did of the accounting professions new antifraud initiatives, such as the (function() { about the Baptist Foundation of Arizona. BFAs failure and the subsequent penalties provide Prosecutors said investors were promised high returns and a safe investment for using their money to build churches and retirement homes, but their combined losses totaled more than a half-billion dollars. too heavily upon management assurances. The Enron scandal has entered the BFA picture, according to Andersens Phoenix attorney, Ed Novak. plans to church members. Scandals and stock market crashes . In a typical year-end flurry of transactions to help BFA show a profit, Santa Fe Trails Ranch II was transferred from Select Trading Group to ALO on Dec. 26, 1995. This caused a lot of people, more than 11,000 investors, to lose their life savings ($550 million). Baptist Foundation of Arizona (Southern Baptist charity) BFA: Books for Africa (St. Paul, MN) BFA: Body Fat Analysis (biology) BFA: British Fantasy Award (British Fantasy Society; UK) BFA: Baseball for All (various locations) BFA: Botswana Football Association (Botswana) BFA: Blank Firing Attachment: BFA: Benefit Fraud Assessment: BFA Visitor Comments. el.parentNode.insertBefore(s, el); With what are they going to make donations?. } var postLoadFunctions = {};

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