A permanent injunction was issued against Greater Ministries International of Tampa, Florida, by the United States District Court in Tampa on Friday, August 20. The injunction was initiated by the Ohio Department of Commerce’s Division of Securities and the Alabama Securities Commission.

The court order commands Greater Ministries to cease their operations and investment programs, including the "Faith Promises" program. It is estimated that Greater Ministries illegally collected at least $100 million nationwide from at least 15,000 investors, including at least 600 Ohioans.

In connection with the legal action, the court appointed West Palm Beach attorney James W. Beasley as a "receiver" to secure Greater Ministries’ records and assets with the hope of returning some money to investors. The receivership process has just begun, and there is no assurance, at this point, that any money will be ultimately returned to investors. Beasley noted that he has found no evidence of legitimate investments by Greater Ministries, and called their operations a "Ponzi" scheme.

Ohio Director of Commerce Gary Suhadolnik stated: "This enforcement action should send a strong message that those who violate Ohio’s securities laws will be subject to legal sanctions." He also noted that the case demonstrates that "Ohioans must investigate before they invest, even if the people offering the investment seem to be trustworthy, or as in this case, claim to have a religious affiliation." Director Suhadolnik encouraged Ohio investors in Greater Ministries to call the Ohio Division of Securities’ Investor Protection Hotline at 1-800-788-1194 or in Columbus at (614) 644-7381.

The Ohio Division of Securities took enforcement action against Greater Ministries in September 1998 when it ordered Greater Ministries to cease and desist from soliciting the sale of unregistered securities in Ohio. To protect investors, Ohio law requires that all securities sold in Ohio be registered with the Division or properly exempted from registration. The Division found that the "Faith Promises" securities sold by Greater Ministries, which promised returns of 100% within 13 months, were neither registered nor properly exempted. In making the finding, the Division did not suggest that there was anything wrong with raising money for religious purposes, and noted that 46 other religious organizations made securities registration filings with the Division of Securities in 1997 in order to make full and fair disclosure to potential investors.

Greater Ministries Permanent Injunction Release

August 24, 1999

Several other states, including Pennsylvania, California and Florida, also took action against Greater Ministries for violation of the securities laws.

The Ohio Division of Securities and the Alabama Securities Commission initiated the injunctive action after it became clear that Greater Ministries was continuing to violate Ohio and Alabama securities laws and was committing fraud. On August 6, 1999, the Ohio Division and the Alabama Commission filed against Greater Ministries in the Tampa federal court a motion for a temporary restraining order and the appointment of a receiver. That day Judge Richard A. Lazzara granted the TRO and appointed Beasley the receiver. And later on August 6, the receiver, assisted by local law enforcement officials and U.S. Marshals, seized Greater Ministries’ headquarters in Tampa.

Evidence seized by the receiver was presented at the injunction hearing on August 20. Included in the evidence presented at the injunction hearing were affidavits from four Ohio residents stating that they invested with Greater Ministries but had not received the promised level of returns.

Ohio Securities Commissioner Thomas Geyer noted that the Greater Ministries case is another recent example of "affinity fraud," a situation where people that share a certain affinity, such as ethnic heritage or religious beliefs, are targeted by scam artists. Commissioner Geyer echoed Director Suhadolnik’s advice to "investigate before you invest," and recommended that prospective investors follow three steps:

• Second, don't accept the promoter's word. Check to see if the salesperson is licensed to sell securities in Ohio and if the security is registered by calling the Ohio Department of Commerce's Investor Protection Hotline at (800) 788-1194. Columbus area residents should call (614) 644-7381.

• Third, if you suspect that you have been defrauded, call the Investor Protection Hotline immediately at (800) 788-1194 or (614) 644-7381.

An Investor Alert titled "Preying on the Faithful" is available from the Ohio Department of Commerce's Division of Securities. The Investor Alert provides common sense precautions that consumers can take before investing in a solicitation being targeted to members of religious organizations. For a free copy, please write or call:

Ohio Department of Commerce
Division of Securities
77 S. High St.
Columbus, OH 43266-0548
(800) 788-1194 or (614) 644-7381

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The Division of Securities promotes an honest and fair securities market where individuals and businesses can raise capital and investors can expect a fair return on their investment. Other Commerce divisions enforce regulations regarding industrial compliance, financial institutions, real estate, liquor, auctioneers, and unclaimed funds, among others. The department's Internet address is www.state.oh.us/commerce