Former CEO, Ephren Taylor, Accused of Targeting Churchgoers with False Investment Promises
Lillian Wells, 60, faces foreclosure as she sits in her home Wednesday, Oct. 26, 2011 in Covington, Ga. Wells lost $122,000 in her life savings that was given to Ephren Taylor's company after hearing him speak at an Atlanta church. (AP Photo/David Goldman)
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Two lawsuits filed this month claim the 29-year-old Taylor was a con artist who targeted worshippers throughout at least five states on the East Coast since 2004, swindling tens of millions of dollars in a Ponzi scheme.
"He knew if he went to a Christian African-American and said, `I can take your hard-earned investment money, and you're going to earn more money, but more importantly you're going to do good for your church and community,' that they would fall for it hook line and sinker," said Cathy Lerman, an attorney who sued Taylor in North Carolina.
The allegations have tarnished Taylor, who resigned last year after becoming the chief executive of the holding company City Capital, which had been based in North Carolina, when he was 23. Worshippers would often be asked to invest in real estate and businesses tied to the holding company.
The Secret Service and the secretary of state's office in Georgia, where the other lawsuit has been filed, are investigating. He has not faced any criminal charges.
Lawyers suing him say they don't know his whereabouts, but he sent The Associated Press a statement after a reporter contacted him through his website.
He said he planned to use his own money to help those who feel "negatively impacted." He criticized his detractors and compared himself to other financial heavyweights who were "crucified" amid the economic downturn.
"Sometimes people will participate in a game they don't have a stomach for, and when it goes south, they put the blame on those that led that game," said Taylor, who did not respond to follow-up questions.
In late 2009, Taylor came to an Atlanta megachurch with his surefire pitch, according to the lawsuit in Georgia. He held a financial seminar aimed at children on a Saturday, telling curious parents to hold their questions. Flanked by Bishop Eddie Long the following day, he told the 25,000 member congregation that his investors would buy can't-miss real estate rather than take a risk on Wall Street.
"He pushed all the right buttons," said Lillian Wells, who said she lost $122,000. "Everyone was tired of losing money in the stock market, and this was an opportunity for a guaranteed return on the money."
Wells is among 10 New Birth Missionary Baptist Church members suing Taylor, the bishop and the church. It claims Long abused his spiritual authority and "coerced" his parishioners into investing at least $1 million in Taylor's fund in late 2009.
The bishop has declined to comment on the lawsuit, but he urged Taylor in a video posted this year on YouTube to "do what's right" and repay the money with interest. In May, Long settled a separate lawsuit filed by four young men who accused him of sexual misconduct.
New Birth is one of the best-known ministries preaching a form of the prosperity gospel, which teaches that God wants to bless the faithful with earthly riches. Ministers in this tradition often hold up their own wealth as evidence that the teaching works. Long has flaunted his own success with flashy suits, expensive cars and large home on 20 acres.
Attorneys said many of the worshippers duped were "socially conscious." But instead of lucrative returns, Taylor and his company used incoming funds from new investors to pay back existing clients, the attorneys said.
Taylor's inspiring success story helped build his mystique. At the age of 12, he sold video games he designed. By 18, he and a friend had helped create a job search engine called GoFerretGo that he claimed was valued at more than $3 million, though one of the lawsuits questioned that figure.
After he was tapped in 2006 as the chief executive of City Capital, now based in California, he was quick to boast in media interviews that the move made him the youngest black leader of a publicly traded company in the U.S.
He wrote books about his financial savvy, appeared on national news networks to offer financial advice and observations and landed a spot speaking to a youth leader's summit at the 2008 Democratic National Convention. He'd convince ministers to let him deliver a Sunday sermon, the lawsuits say, and rev up the boasting of his TV appearances and client list stacked with celebrities and athletes.
It was that record that attracted Joann White, a 61-year-old retiree who invested her life savings of $200,000 in his firm. After years of fighting with Taylor and his associates, she said she lost all but $20,000 of the money.
"I know that's so stupid now looking back at it, but I saw him so often on TV, talking about how great he was," said White, who lives in Belleville, Mich. "And I kind of fell into it."
Source: The Associated Press | GREG BLUESTEIN
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