US authorities charge pastor with defrauding retirees, church members
The United States Securities and Exchange Commission (SEC) today announced fraud charges and an asset freeze against a Michigan-based pastor accused of exploiting church members, retirees and laid-off auto workers who were misled into believing they were investing in a successful real estate business.
The SEC alleges that Larry Holley, the pastor of Abundant Life Ministries in Flint, Michigan cloaked his solicitations in faith-based rhetoric, replete with references to scripture and biblical figures.
Holley allegedly told prospective investors that as a person who “prayed for your children,” he was more trustworthy than a “banker” with their money, the SEC said in a release.
According to the SEC’s complaint, Holley held financial presentations masked as “Blessed Life Conferences” at churches nationwide during which he asked congregants to fill out cards detailing their financial holdings.
He promised to pray over the cards and invited attendees to have one-on-one consultations with his team. He allegedly called his investors “millionaires in the making.”
The SEC, which also charges Holley’s company Treasure Enterprise LLC and his business associate Patricia Enright Gray, said approximately US$6.7 million was raised from more than 80 investors who were guaranteed high returns and told they were investing in a profitable real estate company with hundreds of residential and commercial properties.
According to the complaint, Gray advertised on a religious radio station based in Flint and singled out recently laid-off auto workers with severance packages to consult her for a “financial increase.”
Gray allegedly promised to roll over investors’ retirement funds into tax-advantaged Individual Retirement Accounts (IRAs) and invest them in Treasure Enterprise.
The SEC alleges that no investor funds were deposited into IRAs, and Treasure Enterprise struggled to generate enough revenue from its real estate investments to support the business and make payments owed to investors.
Treasure Enterprise owes investors an estimated US$1.9 million in past due payments, according to the SEC’s complaint.
“As alleged in our complaint, Holley and Gray targeted the retirement savings of churchgoers, building a bond of trust purportedly based on faith but actually based on false promises,” said David Glockner, Director of the SEC’s Chicago regional office.
According to the SEC’s complaint, Holley, Gray, and Treasure Enterprise were not registered to sell investments.
The SEC has obtained a temporary restraining order in U.S. District Court for the Eastern District of Michigan that freezes the assets of Holley, Gray, and Treasure Enterprise. The court’s order also appoints a receiver and imposes other emergency relief.