Ponzi Scheme Strikes Bethel Church
In 2009, a conman bilked members at Bethel Church in Redding, California, out of more than $650,000. Now, two shysters peddling a Ponzi scheme have reportedly struck the controversial megachurch again—this time defrauding investors of $35 million from 2015 to 2020.
Accused in a recently unsealed 31-count indictment by the Department of Justice (DOJ) is 44-year-old Matthew Piercey and his alleged accomplice, 67-year-old Kenneth Winton. Piercey is a congregant of Bethel Church. And Winton describes himself as a “God Lover” on his Facebook page where he often posts Scripture and inspirational thoughts.
“Piercey used (his two companies) Family Wealth Legacy and Zolla to solicit funds from investors using a variety of false and misleading statements, including about trading algorithms, the success of the companies’ investment strategies, and the liquidity of investments,” the DOJ said in a press release announcing the charges.
When Piercey’s outlandish claims about investment returns failed to materialize, investigators say he and Winton funneled some $8.8 million back to earlier investors, constituting a Ponzi scheme.
“Piercey entered a pattern of paying old investors lulling payments with new investor funds, while making various false and misleading statements, half-truths, and omissions to raise new money and to hide the constant downward financial spiral,” government attorneys wrote in a court filing on Nov. 17.
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According to The Sacramento Bee, Piercey specifically recruited Bethel Church members as investors.
Additionally, court documents say that when Piercey learned of the FBI’s investigation into his activities, he urged investors not to cooperate with the probe. In an email to one investor, Piercey suggested that the probe was a response to a letter Piercey had sent President Trump about saving the banking system.
“In light of our emboldened focus to rescue the banking system,” Piercey wrote, “be advised I anticipate potential new levels of regulatory scrutiny.”
If Piercey truly targeted Bethel members, it would be at least the second time the church has found itself embroiled in such a scandal. In 2009, a jury sentenced Bethel congregant David Souza to 18 years in prison after he conned fellow parishioners out of between $650,000 and $947,000 using a fake investment pitch and the tagline, “Where business is moral and the miraculous is routine.”
Churches tend to be susceptible to what experts call “affinity fraud,” a scam that spreads in a tight-knit community.
“Once the fraud breaks into a group, trust is there, and the guard is dropped,” said Kevin Baker, a private investigator who previously led the FBI’s white collar crime unit in northern California. “Churches are ripe for it.”
In this case, Bethel’s theological beliefs may have also contributed: The church promotes the prosperity gospel and teaches faith healing at its School of Supernatural Ministry.
“It’s fair to say if people are already thinking outside the box, they’d be more receptive to things that are not in the mainstream,” Baker told The Roys Report.
The church seems to be aware of its potential vulnerability. On its website is a highly unusual “investing policy and disclaimer,” which reads in part: “Although we pray for miracles in economies and investments, Bethel Church board members, leaders, and management are neither financial advisors nor investment consultants and in no way represent ourselves as such.”
The statement goes on to say it is against church policy to promote or solicit investment opportunities on Bethel property and says leadership “strongly recommends that you seek expert investment advice from qualified professionals before considering any form of investment.”
Bethel communications director Aaaron Tesauro reiterated that policy in an emailed statement to The Roys Report. He confirmed Piercey and his family do attend services at Bethel but said they are not official members. He said the church was “unaware of his personal financial decisions.”
Piercey’s recent arrest drew national attention when he used an underwater “sea scooter” to attempt to avoid arrest.
Bethel also made headlines recently when a surge of more than 100 COVID-19 cases were linked to Bethel’s School of Supernatural Ministry.
According to court documents, Piercey could face, on “the low end,” life in prison for his cumulative offenses. Investigator Kevin Baker said life sentences for financial crimes are rare, but Piercey will face significant consequences if convicted.
This article first ran at The Roys Report. J.C. Derrick is a journalist and former managing editor at WORLD Magazine.