Foundation investors speak on sentencing of execs: Ex-president, ex-counsel were convicted of fraud

Foundation investors speak on sentencing of execs: Ex-president, ex-counsel were convicted of fraud. Check it out:
(Tribune, The (Mesa, AZ) (KRT) Via Thomson Dialog NewsEdge) Sep. 29--The investors of the bankrupt Baptist Foundation of Arizona all suffered financial losses, but on Thursday, they were divided by the sentiments they had for the men convicted of defrauding them.



The victims of the scandal came from all over Arizona to a downtown Phoenix auditorium to tell Maricopa County Superior Court Judge Kenneth Fields of the impact the loss had on their lives and to recommend a sentence for William Crotts, the foundation's former president, and Thomas Grabinski, its former general counsel.

"These men have damaged a lot of lives and ruined a lot of lives," said Patricia Srader of Sonoita, who invested more than $1 million into the foundation.

Srader and her husband eventually got back 70 percent of their loss, as did most of the 13,000 investors who lost an estimated $500 million to $600 million when the foundation collapsed in November 1999.

Crotts, 61, and Grabinski, 46, sat at the front of the auditorium, where about 100 investors -- most of them elderly--could see the live feed of the proceedings on three giant screens suspended from the ceiling.

Mesa resident Clara Jo Ziervogel, a former foundation employee who was fired, said she lost a nominal amount of money, but she once believed in the organization and had persuaded friends and family to invest significant amounts.

"I have had to overcome a significant amount of guilt," Ziervogel said.

But Barbara Secrest, a friend of the defendants who invested about $50,000 in the foundation, said it would be a waste of taxpayer money to incarcerate the men, who are facing prison terms of six to 86 years.

"We feel we're a victim of the state of Arizona," she said.

She believes that if the state hadn't shut down the organization, then all of investors would have all of their money today.

By lunch recess, 21 of the 34 investors -- including family members of the defendants -- had taken the podium.

The nonprofit Baptist Foundation of Arizona was founded in 1948 to raise money for Southern Baptist causes, such as building churches.

Prosecutor Donald Conrad alleged in court that the group's sales pitch was based on religious faith, and investors were told the nonprofit was solvent, even though Crotts and Grabinski knew it was losing millions of dollars.

In July, a jury found each man guilty of three counts of fraud and one count of knowingly conducting an illegal enterprise, but acquitted each of 23 counts of theft.

Fields is expected to impose sentences today.

Copyright (c) 2006, The Tribune, Mesa, Ariz.
Distributed by McClatchy-Tribune Business News.
For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.
The opinions and views expressed in comments, blogs, etc. are those of the authors alone and not necessarily those of TMC, TMCnet, or its editors. TMCnet reserves the right to edit, delete, or otherwise make changes to the content that appears on these pages at its own discretion and as it deems necessary.

Listed below are links to sites that reference Foundation investors speak on sentencing of execs: Ex-president, ex-counsel were convicted of fraud:

Around TMCnet Blogs

Latest Whitepapers

TMCnet Videos