Christians can be so gullible! Recently I came across the following all within one day. The BC Province had a headline story “Churchgoer accused of Ponzi scheme” followed by a background story “BC has a history of scams targeting religious communities.” I came home, caught up on Mark Petersen’s blog Open Hands [blog no longer exists] and watched the interview he posted where the high profile leader of a Christian agency explains himself and apologizes for his role in promoting a Ponzi scheme. Then I read in the KW Record a story about a well-known local Ponzi artist and discovered some new information; that he taught adult Sunday School at his church and one of his victims was a missionary couple working for a Christian agency. I could mention names of people and churches, but that is not the point of this post. If you need to, you can follow the links. I, however, want to focus on what ministry leaders can do to protect the people in our care from these schemes.
Church leaders often promote schemes
First, we must acknowledge that ministry leaders are often involved in these schemes themselves. With just five or ten minutes of googling for some of these details, I discovered that among the stories just referred to, the perpetrators include a leading member of a church, a Sunday school teacher, a church co-founder, a pastor, an elder, and of all things, a choir member (surely the choir is above suspicion!). Promoters (who may be just as guilty as the perpetrators or naïve dupes themselves) included an internationally known evangelist, a prominent pastor/televangelist, and the leader of a prominent television ministry.
These facts look really bad on us.
Churches are known to be vulnerable to frauds
Read this assessment from the Province‘s background story of October 23rd and weep for the church:
Rob Gordon, director of the Simon Fraser University School of Criminology, said “the use of churches to separate gullible individuals from their money has a long history.” In some cases, the scammer becomes a member of the church and in other cases, pretends to be, Gordon said. “There’s an association that the person is trustworthy,” he noted. The fraud artist is viewed as “honest” because he’s in the same church, so he’s trusted. “They are appealing to (an emotion), which is ‘get rich quick,’ said Gordon. “People fall for this with astonishing stupidity.”
Stupid, gullible Christians who want to get rich quick. Not a pretty picture!
Five ways to protect churches from fraud
What can we as Christian leaders do to eradicate this blight from our community? Here are five action steps.
- First, sad as it is, one of the above stories involves a pastor with eighteen years of pastoral experience who, directly or indirectly, fleeced over 300 church members. The BC Securities Commission called him the mastermind of the scheme in its findings [this document has now been removed from their website]. This is criminal behaviour and a complete moral failure. While I don’t know what his board did in providing oversight, this is surely an instance where it should have aggressively demanded answers from him, as it is the board’s responsibility (along with the denomination) to protect the church from a pastor gone bad. Every board should have an Ethics and Whistleblower policy* for the ministry to help ensure that complaints get its attention. See my post The private life of a Christian leader for more on oversight of ministry leaders. So number one, pastors should educate their church members that every Christian is responsible to test everything to see if it is good or not (Romans 12:2). This applies not only to doctrine, but to every decision they make. Specifically, it means they should not accept anything based only on who it is that is offering it to them. Pastors are not exempt from this scrutiny.
- Ponzi perpetrators always look for people who are well-respected and well-connected to act as their finders for new victims. That means you as a leader in the Christian community are a prime target for recruitment into a Ponzi scheme. Your guard should be up immediately whenever someone asks you to participate in an “opportunity” to make money. Don’t be flattered by their approach; without you they have a much harder time. Therefore, whether it is an investment scheme or a multi-level sales program, anything that requires you to recruit for or promote something that involves money should automatically be turned down. If you get involved, you are likely abusing your spiritual authority, because no matter how hard you try to separate your spiritual leadership from your opportunity, many in your congregation will see your spiritual authority as inseparable from who you are. If you lead a Christian agency, you should not promote anything to your staff either, unless it is participation in your own program, such as a pension plan. Again, you are abusing your authority. So number two is, don’t participate yourself!
- Schemers might try to draw you or your parishioners/employees in by saying you can use the money you’ll make to support your ministry, or missions or some other good thing. The lack of a personal benefit does not make criminal activity acceptable. You are still engaged in unrighteous behaviour. Due to the proven susceptibility of church members to buy into these and other schemes, number three is for church leaders to educate their members about these schemes and strongly recommend that they avoid them. If there is a particular scheme circulating in the church, the pastor must speak up about it. Tell your congregation what a Ponzi scheme is so they can recognize it. Show them how promoters try to manipulate them. Expose the work of the enemy. You could do this in a newsletter that they can keep and circulate outside of the church. In fact, as I write this, I think we at CCCC should write this for you and make it available for downloading. Save you some time. Okay, I commit to doing that. It’ll be up within a week of this post in the Sample Documents area of our website. Non-members can request it by using the blog’s contact form. This step should go broader than Ponzi schemes to include the many fraudulent tax-receipting schemes that are currently quite prevalent and that are the focus of a major Canada Revenue Agency audit program.
- Number four is for boards to pass an investment policy* to protect the charity itself from such schemes. One of the largest Ponzi schemes to hit religious organizations was the Foundation for New Era Philanthropy that took in over $500 million from 1989-1995 and nearly destroyed a number of very large Christian ministries. A good investment policy sets limits on the kind of investments that are acceptable and ensures there is good professional advice. Many organizations make bad investments because staff or volunteers make decisions on their own without professional counsel. In some cases they persuaded the board to go along with it. Board members could be in breach of their fiduciary duty and bear personal liability for the losses if they accept unqualified advice.
- At its core, Ponzi schemes thrive because of greed and laziness. Someone offers an easy, quick, no-effort and (usually) a risk-free or virtually risk-free way to make a lot of money, whether to benefit yourself or a cause that you believe in. Laziness and greed should not be characteristics of mature Christians. It’s funny how mothers are so wise, but here is one we’ve all heard from our mothers at some point and it is the final message you should give your church members. Number five is to tell everyone, “If it is too good to be true, it probably is.” In fact, maybe it should be stronger. “If it is too good to be true, it is!” Only one thing truly is too good to be true, and yet it is, and that is the really Good News of God’s love for you and Jesus Christ’s sacrificial death that allows you to experience it!
* Sample policies appear in the CCCC website member-area: “Download Sample Documents.”