Ward Investment Scam!: You’re the Bishop (Poll #12)

by: Bishop Bill

October 22, 2011

A brother in your ward has been soliciting investments from members of the ward and stake for a business venture that involves food trucks at local county fairs.  Many church members, including a member of the Stake Presidency, have invested amounts of $5000 to $10,000 in this business venture.

The man has not paid anybody back as promised, and some ward members are starting to grumble and have come to you to complain. One investor is your second counselor who has done some investigating and discovered that this guy did the same thing in a previous stake, and that he owes a lot of money to investors in that stake. Your counselor shares this information with the Stake Presidency member who also invested. 

You're the bishop. What do you do (Poll #12)

  • Call the brother in question in and ask him when he intends to pay back his investors. (39%, 44 Votes)
  • In Sacrament Meeting, remind members that they should always do due diligence if approached about business ventures. (34%, 39 Votes)
  • Let the Stake President handle it since he is well aware of the situation and the brother is a Melchizedek Priesthood holder. (17%, 19 Votes)
  • Nothing, he has not violated any church rules. (10%, 12 Votes)

Total Voters: 114

Loading ... Loading ...

Discuss.

Tags: , , , ,

36 Responses to Ward Investment Scam!: You’re the Bishop (Poll #12)

  1. Toni on October 22, 2011 at 4:40 PM

    None of the above. It sounds more like a job for law enforcement.

    Fan Favorite! Do you like this comment as well? Thumb up 20

  2. el oso on October 22, 2011 at 4:57 PM

    I would tell the counselor that I am not doing anything at present. He can call the police, tell everyone he knows about the guy, or just confront the offender.

    Like this comment? Thumb up 1

  3. andrew h on October 22, 2011 at 4:58 PM

    When this guy was scamming people, did he say he was Paul Dunn’s son-in-law, or show them a picture of Paul Dunn to get them to invest?

    Fan Favorite! Do you like this comment as well? Thumb up 9

  4. Kevin Barney on October 22, 2011 at 6:20 PM

    This is why I have a personal policy against doing business with fellow Mormons.

    Fan Favorite! Do you like this comment as well? Thumb up 14

  5. Kevin Barney on October 22, 2011 at 6:22 PM

    Or show a taped message from Ty Detmer on affinity fraud to a joint session of priesthood/RS…

    Like this comment? Thumb up 3

  6. Starfoxy on October 22, 2011 at 7:18 PM

    I would advise the ward members who are complaining to me to contact a lawyer or the police if they feel they have been a victim of fraud.

    Bishops stand ready to help people repent when they’re ready to change. Bishops shouldn’t be chasing down anyone, and can’t force anyone to do a darn thing. Cops and the courts are the ones who chase down wrong doers and make them pay restitution.

    Fan Favorite! Do you like this comment as well? Thumb up 18

  7. Whizzbang on October 22, 2011 at 9:57 PM

    this exact thing, minus the food truck thing, ahppened in my Stake. The brother in question asked a variety of members for money for some Chilean lumber business, they got taken for all their investment. The brother’s defense was . “whoops bad business” but the investors thought he deliberately had taken them for a ride. He was investigated in a Church court but nothing was done to him and so essentially he got off and the investors lost their investment

    Like this comment? Thumb up 2

  8. Stephen M (Ethesis) on October 22, 2011 at 10:40 PM

    It can be hard to tell the difference between fraud and stupidity some times …

    Which is where criminal prosecutors can come in handy.

    Fan Favorite! Do you like this comment as well? Thumb up 5

  9. Ray on October 23, 2011 at 12:07 AM

    What Stephen said, so I would suggest to anyone who talked to me about it that they contact a lawyer.

    Like this comment? Thumb up 0

  10. J.Ro on October 23, 2011 at 12:49 AM

    At most I would discuss with him my concerns about the situation, because it involves ward members and he has solicited them directly. I think that much is warranted by the circumstance, but little more. Encouraging him to make good on his commitments in private is one thing, but making a clearly directed statement in a ward that is certainly already abuzz with news of this is something that seems just plain disrespectful. But a bishop is a “judge in Israel” and not in a court of law.

    Like this comment? Thumb up 1

  11. hawkgrrrl on October 23, 2011 at 2:09 AM

    I would pull out and re-read the “people, don’t be a dumbass” letter from the first presidency reserved for such occasions. Do we have one of those?

    Fan Favorite! Do you like this comment as well? Thumb up 15

  12. Joshua Whelpley on October 23, 2011 at 7:06 AM

    Hawkgirl-that was so fabulous. I literally laughed out loud. Well, I chuckled out loud. It’s a great idea. Such a letter may not exist yet but Im sure I have a testimony of it!

    Like this comment? Thumb up 3

  13. Will on October 23, 2011 at 10:37 AM

    Number 3 and Hawk (almost does) don’t go far enough. The Bishop needs to stand up and state: “if you invest with someone simply because they are a member of the church, especially a leader, you deserve to loose your money”

    Fan Favorite! Do you like this comment as well? Thumb up 7

  14. Jeff Spector on October 23, 2011 at 10:59 AM

    Call the cops.

    Like this comment? Thumb up 3

  15. jose on October 23, 2011 at 3:08 PM

    Just because someone is a “good” member of the church does not make them a good businessman. Ask to see their business plan before investing. Don’t have one–they are either incompetent–at best–or fraudulent.

    Like this comment? Thumb up 2

  16. Joe S on October 23, 2011 at 5:40 PM

    @andrew h

    Maybe a little harsh? P Dunn didn’t necessarily hurt anyone. He just told uplifting, fictitious stories. IMHO, there is a significant difference between the two situations.

    Like this comment? Thumb up 4

  17. pondering on October 23, 2011 at 7:21 PM

    So it’s okay to tell untruthful stories (as though they were totally true) and deceive countless numbers of impressionable people while aggrandizing oneself, but don’t let anyone dare be messing with our money. Personal integrity of a GA — or financial dishonesty, playing on folk’s desire to make a buck, by a rank-and-file member. Joe S, I believe you have the significant difference reversed. IMHO.

    Like this comment? Thumb up 1

  18. Douglas on October 23, 2011 at 7:29 PM

    #11 – HG, you must have been O’D-ing on “King of the Hill” reruns! Another one knocked twenty rows into the bleachers!
    I fully agree that members should be counselled heavily not to take leave of good financial sense just because a fellow member is pitching something. I’ve seen all too many scams worked in 32 years of being a member. And just as much if not more harm can be wreaked by someone who is himself sincerely duped or just plain stupid.
    I’d say to the members who’ve lost money that they should pursue whatever legal remedies are available, whether by lawsuit or criminal prosecution. If the latter sticks, THEN a Church disciplinary council may be in order. Doing it before legal matters are settled could derail same.
    Of course, often folks fall for this crap because they themselves have an ego that a Mack Bulldog couldn’t pull or they get infected with the “get rich quick” bug. It doesn’t shock me any more who falls for it.

    Like this comment? Thumb up 2

  19. hawkgrrrl on October 23, 2011 at 8:03 PM

    “P Dunn didn’t necessarily hurt anyone” I think he hurt people’s testimonies by substituting what is true and uplifting with manufactured sentimentality masquerading as proof of the truthfulness of the gospel. The valuable lesson he gave us is holding up a mirror to all of us to say “Look at your own mistaken judgment. You claim to have the spirit, but can’t tell the difference between what is real and what is not.” While I know those things weren’t his intention, plaigiarizing and fabricating stories that one claims are true to sell books and win the praise of men, being dishonest while holding the office he held, those are damaging actions.

    Like this comment? Thumb up 3

  20. Douglas on October 23, 2011 at 10:01 PM

    #19 – they are, but so friggin’ what…just shows that even in the hierarchy of the Lord’s Church, we have to staff it with the (male portion) “Hew-Mon” race, with all attendant pitfalls. Elder Dunn’s fall from grace was what, over 20 years ago? About the same time that George P Lee got ex’d (turned out later that he had a wee thing with wee lassies), so at least we got the “scandalization” over with. Considering what’s at stake, and just what a feather in his cap it’d be for the Adversary to take down a GA, I marvel that it doesn’t happen more often! AFAIC, they’re still pretty much made of sterner stuff than I. Look at how many of the original Quorum of the Twelve of the Restored Church (1835) fell away. We ain’t playing this thing for peanuts….
    “I don’t know what concerns me more…that we have a missing nuclear weapon or that it happens often enough that there’s a term for it.”

    Like this comment? Thumb up 1

  21. Porter on October 23, 2011 at 10:04 PM

    If you are interested in real stories like this, there is a great website that tracks exactly this sort of thing: http://utahsecuritiesfraud.com

    You’d be amazed at how much this sort of thing really happens (especially in Utah county). I think there are lot of a members of the church who think that because someone is an active member of the Church they must be honest and you can invest with them. It would be great if that was true, but its clearly not.

    Fan Favorite! Do you like this comment as well? Thumb up 4

  22. Douglas on October 23, 2011 at 10:06 PM

    #21 – THANK YOU. Folks need to be educated!

    Like this comment? Thumb up 0

  23. andrew h on October 23, 2011 at 10:52 PM

    @ Joe S.

    Joe – The Baseball and War Stories were just the beginning. Dunn and his son-in-law Jeril Winget were involved in several investment scams in the late 70’s and 80’s. For a few links see:

    http://www.deseretnews.com/article/447299/SL-WOMAN-SUES-DUNN-HIS-SON-IN-LAW.html

    http://www.deseretnews.com/article/449468/JUDGE-RULES-THAT-PAUL-H-DUNN-HAD-OWNERSHIP-IN-BUSINESS.html

    https://www.sunstonemagazine.com/pdf/089-60-65.pdf

    I have a scanned pdf of the Utah Holiday article by Lynn Packer where he covers the AFCO scam, the Sports Camp Scam, the property investment scams etc. Anyone interested in a copy can email me at [email protected] and I will gladly send it to you. I am in the middle of mid-terms (working on a masters degree) so please give me a day or two to reply.

    Fan Favorite! Do you like this comment as well? Thumb up 4

  24. Cowboy on October 24, 2011 at 9:22 AM

    I think the public statement would be appropriate. It should be simple warning against doing any business without thoroughly following up on the risk and legitimacy of a proposed venture. It should also state that using Church records (ward contact lists) for personal business purposes is rude.

    Not necessarilly the biggest scam in town, but my wife and I recieved a call from a couple in the Ward a while back, stating that they would like to visit with us. They both held leadership callings. When they arrived we learned that they had signed up with Primerica and were interested in “helping” us plan for our financial future. It irritated me.

    Like this comment? Thumb up 1

  25. Paul on October 24, 2011 at 5:59 PM

    It seems the present attitude in the church is that these matters should be settled in a court of law, not in a disciplinary council. That was not always the case, but seems to be where we are these days.

    As a result, I’d advise people to consult an attorney if they need to. If the offending brother is about to receive a calling or renew a recommend, some time on the honesty question might be in order if the bishop felt so inspired.

    It also would not hurt for the bishop to consult with the stake president for his view.

    But in the end, I’m with #4 Kevin Barney.

    Like this comment? Thumb up 0

  26. Jeff Spector on October 25, 2011 at 6:22 AM

    “When they arrived we learned that they had signed up with Primerica and were interested in “helping” us plan for our financial future. It irritated me.”

    I’ve had this happen from time to time from inside and outside the Church. For some reason, I have a nose for this stuff, so I give folks the third degree on why they want to talk to us, etc. I can usually nip it in the bud without having to have them over.

    I usually end with, “if I want to go into business for myself, it will be something I enjoy, not selling insurance, investments, credit cards or soap.” And I will keep all the money I earn!

    I just despise MLM!

    Like this comment? Thumb up 2

  27. All_Black on October 27, 2011 at 7:14 PM

    #11 “re-read the “people, don’t be a dumbass” letter from the first presidency reserved for such occasions. Do we have one of those?”

    President Hinckley actually sent one out in late 2007 or early 2008.

    Here’s a site talking about that letter:
    [http://www.ldsresources.net/first-presidency-warns-of-financial-fraud/]

    So correct answer would be 3.

    By the way, I noticed that last post and this too (up to today) the Bishop hasn’t responded as to what he considers the correct answer or what he did when the questions came up. Whats happened to Ask the Bishop’s answers?

    Like this comment? Thumb up 1

  28. DB on October 28, 2011 at 7:50 AM

    If a member of the church asks you to invest in a business venture, run away. If a family member asks you to invest in a business venture, run away. If anybody asks you to invest in a business ventrue, run away. The only reason a person would solicite money from individuals rather than a legitimate financial institution is because there’s no risk or cost to them when they get money from the individuals. Why would you ever give money to somebody and assume all the financial risk when the person receiving the money assumes no financial risk? I agree with hawkgrrl, don’t be a dumbass! I vote for #3 but change “do due diligence” to “run away”!

    Like this comment? Thumb up 1

  29. Cowboy on October 28, 2011 at 8:17 AM

    DB:

    This is a little overkill here. There is a lot of risk in investing, and potentially a lot of reward. Why would a person ask someone else to bear some of the financial risk of their vision? Because often innovation does not culminate in the perfect storm financial capabilities all within the same person. The problem with investing with Ward members has nothing to do with investing and everything to do with risk management and underwriting. Commonly when fellow Ward members come to us for “investment” opportunities, they do it under the guise of blessings from heaven. I think there was precedent for this kind risk valuation set in the early days of the Church…something to do with a bank in Kirtland? In short, they want you to invest on the basis of your relationship, and on the basis of the person, not the proposition. There are plenty of people with solid integrity who have bad business sense. When a person primarily targets their Ward to build an investor pool, their sales rhetoric starts to overlapp into religious rhetoric. And that is bad risk management.

    I’ve seen some very succesful business relationships that were formed by Ward and Stake members (I live in Utah County afterall) – so blanket policies about not going into business with fellow Mormons is a bit paranoid in my opinion. So long as decisions are based on the quality of the enterprise underlying the investment, and not the status of the persons place within a Ward, investing with fellow Mormons (even Ward members) is just fine.

    Like this comment? Thumb up 1

  30. Cowboy on October 28, 2011 at 8:21 AM

    Jeff:

    I agree – MLM solicitations do sort of have common smell that can usually be sniffed out in the conversation. This particular call was much simpler though. They just asked if they could come and “chat with us for a few moments”.

    Like this comment? Thumb up 0

  31. DB on October 28, 2011 at 12:48 PM

    Cowboy – I’m not talking about going into business with fellow church members. That’s completely different. I’m talking about someone soliciting investment money as described in the story. I just don’t see a person with a track record of successful business ventures and investments soliciting money from individuals. I would not trust my money with anybody (fellow mormon, family, friend, whoever) who asks me to invest in their business venture. You may think I’m paranoid but I think you’re crazy if you would actually hand your money over to somebody like that.

    Like this comment? Thumb up 1

  32. Cowboy on October 28, 2011 at 1:15 PM

    DB – As somebody who has played the VC game a time or two, I can tell you that money is money. Whether you borrow from a bank, a VC group, or a cluster of private individuals, the only thing that really matters is the green-ness of the cash and the terms of the contract. Right now banks and VC groups are swampped with opportunity, so finding a collection of private investors is not a bad solution. The soundness of the proposition rests wholly on the proposition itself.

    As a general gut-check, I agree with you on the specifics of the situation mentioned in the post. I disagree that just because a friend or neighbor presents you with an opportunity (assuming you have some risk tolerance) that you should run. When they start talking MLM, ie, downlines, be your own boss, etc, then yes…RUN! Otherwise, hear them out – if you don’t understand private investing, then stay out or find someone you can trust who is willing to explain it to you. In other words, these hard and fast rules sound good, but they are more of a knee-jerk reaction than a well considered rule of thumb.

    Like this comment? Thumb up 0

  33. Douglas on October 30, 2011 at 10:46 PM

    I find a good rule of thumb is: don’t just look at the pitch, but also the pitcher. There’s nothing wrong with trying to make a few bucks, as long as the product/service itself has value. If the person soliciting your business doesn’t inspire confidence, then don’t do business with them, period, even if the product seems good. If the product is good, find someone you can have confidence in. In the end, the medium may be products for cash, but it’s people we work with.
    It’s not that I wouldn’t object to doing business myself, but I have to ask myself, am I sold enough on the product that I feel it’s a deal that I shouldn’t pass up, even if I never make a living out of it myself but merely remain a consumer? If so, then and only then would I feel comfortable in pitching it to others. I know, that doesn’t make me a great salesman, but I’m not pushing ice in the Barrow, Alaska ward to my Eskimo brethren.
    The ones that I steer far and wide of are the perpetual ne’er-do-wells that go from one MLM to another, often with the “fake it until you make it” spin. What is really galling is that often these bozos, rather than devote themselves to a steady gig with a reliable paycheck, however humble and/or humdrum it may seem, keep chasing these fantasies, often with their ever-suffering spouses working two jobs and trying to be supportive as the bills mount and the family needs go unmet. Seen it all to often, and it’s just sad….

    Like this comment? Thumb up 1

  34. Jonathan on November 28, 2011 at 1:49 PM

    Business and church are a terrible combination. Soliciting members and using membership lists is wrong – mormon or whatever.
    Interfere with a pointed announcement in Sacrament and other meetings pointing out this guy by name and warn people away.
    The Stake President can always release the Bishop, but at least he will have done the right thing. No one should be using church for business contacts even though LDS,inc is a business masquerading as a church.

    Like this comment? Thumb up 1

  35. [...] hawkgrrrl, on what a bishop should do if one ward member is scamming many others with a phony investment scheme, commenting on Bishop Bill’s post “Ward Investment Scam!: You’re the Bishop (Poll #12)” at Wheat & Tares: I would pull out and re-read the “people, don’t be a dumbass” letter from the first presidency reserved for such occasions. Do we have one of those? [...]

    Like this comment? Thumb up 0

  36. Burned too on October 21, 2013 at 2:10 AM

    I know Jeril Winget all too well… He is a complete scam artist in everything he does!!! Paul. Dunn was NOT involved in the bad business deals, Jeril (his son in law) used his name & status to get people to trust him & give them money to “invest” in his large houses, family vacations & his outlandish life style. Paul didn’t even know about 90% of the deals that went south… The other 10% he lost his money as well. If you run across a Winget… run the other direction. My hope is that as promised… He will get his “just reward” for this life. I’m one (of many I’m sure) that want to be present when he does. I’d like a front row seat & a large popcorn.

    Like this comment? Thumb up 0

Archives

%d bloggers like this: