Why Churches are Targetted by Fraud Criminals
Recently, in Charlotte, North Carolina "state investigators last week searched a $1.13 million south Charlotte house looking for information on what they say appears to be an investment-fraud scheme that bilked $200,000 from a Monroe church."
In Utah, "The First Presidency of The Church of Jesus Christ of Latter-day Saints has sent a letter to its congregations, urging members to be wary of fraud.
In the letter being read in churches, the First Presidency says "reports of fraud schemes and unwise investments prompt us to again counsel members with respect to prudence in managing one's financial affairs."
"We are concerned that some church members ignore the oft-repeated direction to prepare and live within a budget, avoid consumer debt, and to save against a time of need," the statement reads.
Here is a typical pitch.
The criminal's "approach was always the same, according to the detectives. He would move in to town, join a church or temple with a large congregation...Newcomers always attract attention and stimulate curiosity, and Sam's seemingly endless energy, unwavering sincerity, and positive outlook led many parishioners to seek him out for friendship ...
In so many words, Sam explained that he was once a high flying investment banker who realized the shallowness of his chosen career only after his young wife and infant daughter died in a horrible car accident.
His resulting bout with depression, alcohol, and pills finally led him to understand that Creator had some thing more in store for his life.
Sam quit his job and moved out of his family penthouse apartment to fulfill his newly found purpose.
Because he continued to do well with his investments, he didn't have to work but could dedicate his life to helping others, and give back to community in the name and spirit of his lost family."
The story ends like this AHN | Federal Jury Convicts A Kansas City Man For Committing $1. 5 Million In Fraud Against A Church And Individuals | May 11, 2007
Why are churches and temples so prone to affinity fraud? And what can they do about it?
There are three factors, or principles of decision making, which make it easy to concoct an affinity fraud and get away with it.
First, although the congregation has to be large to maximize the chances of finding the rich suckers, there are only a few individuals who typically have to be conned -those individuals who provide the leadership to the congregation.
Although the leaders provide spiritual leadership, they are unlikely also to have the necessary practical skepticism needed for the investment industry.
Enough people in congregation will defer their decision making to what the "most spiritual" leader is recommending that they do. This is known as the principle of social choice - most people will assume, incorrectly, that someone, anyone, has checked "Sam" out.
(A painful reminder of this group myopia can be gleaned from reading the various books on Alan Eagleson's involvement with the NHL Hockey Player's association.
Eagleson only had to obtain the friendship of several of the top NHL players in order to control the entire group. Mean spirited and vicious, Eagleson would challenge any attack on his authority by demanding to know what the "f**k you ever did in the league"?)
The second problem, both churches and temples face, is that after the scheme unravels, there will be a large number of the congregation who will remain in a state of denial -they simply cannot appreciate the possibility of intra species predators.
The blind trying to describe the elephant.
Finally, this group of individuals rarely gets the appropriate counsel, nor are they encouraged to discuss their experiences with members from other churches or temples.
What is the solution to this problem, the problem of affinity fraud?
Again, as with any attack of a predator the goal must be to minimize losses --you will never eliminate the loss because psychopath predators are superior at using people solely as means to an end.
Churches and temples remain at risk because after the predator strikes, they have no early warning system to alert other similarly placed churches or temples.
Without such a system, churches and temples remain at risk.
I will also make a prediction - for the next ten years, the most unreported ponzi criminal frauds will take place in mosques across United States and Canada.
The pitch will be for some brand new sharia approved investment vehicle, complete with vague references to empowering Muslims throughout the world.
Most of these won't be reported, but many mosque leaders will end up driving brand new hummers."
