The head of a Cleveland, Tn., production company has been charged with defrauding the Cleveland-based Church of God International of $100,000 in connection with his part in setting up the church's world convention in Orlando, Fla., in 2010.
Troy Scot Carter was charged by federal authorities with securities fraud.
A four-page criminal information says the church hired Carter as a salaried employee with the title of director of communications to help manage the biannual conventions.
He was to help in convention site selections and work with the hotels, convention centers and audio-visual firms involved.
Carter was the head of Scot Carter Productions LLC, an audio-visual firm in Cleveland.
The information says Carter devised a scheme to defraud the church by submitting fraudulent bills in connection with the meetings.
It says as part of the scheme that Carter obtained a contract to provide audio-visual services for the Empowered 21 conference in Tulsa, Okla., at the Oral Roberts University Mabee Center on April 8, 2010. He subcontracted the actual work to Majestic Productions of Indiana. The information says Majestic was unaware of his alleged scheme.
It says Carter and officials with Empowered 21 agreed on a total price of $211,420. It says Empowered 21 was not involved in the scheme.
The information says it was agreed that Carter would receive $44,520 and Majestic would get $166,900. It says Carter only paid Majestic $66,900, "not the $166,900 he rightfully owed them under the contract."
In order to pay the remaining 100,000 to Majestic, it says he submitted a fraudulent bill for $100,000 to the Church of God purporting to be for a down payment owed to Majestic. In fact, Majestic was to perform services for the Church of God in 2010 but did not require this down payment and the $100,000 never became part of Majestic's actual bill, the information says.
The Church of God sent the $100,000 to Majestic, which federal officials said allowed Carter to retain $100,000 he had received from Empowered 21, that he was not entitled to.
James Brooks is handling the prosecution for the federal government.
A statement from the Church of God general overseer on Saturday said:
We learned yesterday that Troy Scot Carter, a former Church of God employee, was officially charged for his part in an elaborate scheme to financially defraud the church, over a period of several years, according to information provided to church officials.
Approximately two years ago, church officials were made aware of possible irregularities regarding General Assembly financial matters involving this former employee. Immediately thereafter legal counsel for the church was notified, and after consultation with outside legal counsel, the Federal Bureau of Investigation was contacted. This began an extensive investigation, with which the International Executive Committee has fully cooperated.
During the pendency of this investigation, church leaders were advised by federal authorities and by legal counsel not to publicly comment on or publish information regarding the investigation. However, the International Executive Committee was allowed to and did keep the International Executive Council apprised as to the general progress of the ongoing investigation.
The findings of the investigation have revealed that no elected church official, former or present, was involved in or had any knowledge of the irregularities giving rise to this criminal matter.
It is believed that the irregularities relate to various expenses connected with past International General Assemblies. A significant amount of the missing funds potentially will be recouped due to an insurance policy protecting the church against such fraud. The church has taken additional measures to ensure that this type of scenario will not occur in the future. The church will take further steps to evaluate the prospects of exercising its legal options to recoup all of the money which was taken and is advised that restitution will probably be a part of any order of the court.
The church also has been advised that the filing of such charges usually is followed by the presentation of a proposed plea agreement which will outline, in some detail, the results of the investigation. The disposition of any plea agreement, when entered into, is under the sole discretion of the federal authorities. The church will continue to cooperate fully with the FBI and the office of the United States Attorney for the Eastern District of Tennessee.
We urge prayer for all involved and for the continued ministry of the church.