Jailed pastor’s secret kickbacks

Flashback

 

The Journal Gazette reports…

“A northwest Indiana megachurch is the center of a federal lawsuit alleging financial fraud.

Filed this week in the Hammond division of the U.S. District Court for the Northern District of Indiana, the lawsuit names First Baptist Church of Hammond as the sole defendant.

The fundamentalist Baptist church identifies itself as one of the largest in the state of Indiana, and in the 1970s boasted of having the largest Sunday school program in the nation. With two Christian schools, a non-accredited Bible college and an expansive bus program, the church has had a presence in the Chicagoland area for decades.

But since the 1990s, the church has been plagued by sex scandals, in both news reports and lawsuits accusing the church and its staff of misdeeds.

Ex-pastor Jack Schaap is currently serving a federal prison sentence, due for release in 2023.

He was fired in July 2012, after serving for 11 years. Schaap pleaded guilty to transporting a girl to Illinois and Michigan for sexual encounters over a four-week period starting the week before the girl turned 17. He also had sex with her in his church office.

Schaap is named in the new lawsuit, but not as a defendant, accused of helping facilitate a financial fraud that bilked two investors out of more than $200,000

A former deacon at the church, later hired as a financial planner, Thomas Kimmel, 70, is also in federal prison. He is due for release in 2034, though a federal court of appeals has ordered a lesser sentence be imposed. 

In 2014, Kimmel was convicted of multiple counts of conspiracy to commit wire and mail fraud and engaging in unlawful monetary transactions, according to court documents.

His role as a fundraiser in “Sure Line Investments,” a business buying and selling used cars which devolved into a Ponzi scheme, involved Schaap and snared a number of individuals around the country, according to court documents.

Kimmel was a financial adviser at First Baptist Hammond and traveled the country seeking investment in Sure Line, according to court documents. 

And Schaap preached from the pulpit that Kimmel’s investment opportunities would give church members more money to use for God, according to court documents.

Both Schaap and Kimmel received commissions on the investments they secured for Sure Line, 1 percent and 10 percent respectively. That information was never disclosed to church members who invested, according to court documents.

In the lawsuit, Joseph Elwell, a 61-year-old First Baptist Church of Hammond missionary now living in Arizona, claims he invested more than $200,000 in Sure Line from October 2009 to December 2011.

Another investor, Deborah Baldwin, was a widow with two small children when she began attending the church. She remarried, and she and her new husband invested $163,000 that was to be left to her children, plus an additional $25,000. She added an additional amount of money later, according to court documents.

Both Elwell and Baldwin believed their investments in Sure Line were legitimate, even receiving what appeared to be “interest payments” from the company.

However, in 2012, the scheme fell apart, and the North Carolina-based Sure Line went into receivership. 

The plaintiffs accuse the church, through its agents Schaap and Kimmel, of deception, fraud and negligent retention of Schaap and Kimmel.

A call to the church was forwarded to a Chicago-based attorney who did not return a message seeking comment Friday.”

From http://www.journalgazette.net/news/local/courts/Megachurch-in-Hammond-faces-federal-fraud-suit-12937272

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