Ephren Taylor II, who is accused of defrauding members of New Birth Missionary Baptist Church and others, during his “Building the Wealth Tour,” was arrested in Kansas City on Tuesday, the U.S. Attorney’s Office in Atlanta said. He is expected to appear before a judge later today. He has been charged with conspiracy, mail and wire fraud, and money laundering.
Here’s more from the U.S. Attorney’s office about Ephren Taylor II and Wendy Connor’s scheme:
As part of the scheme, Taylor traveled around the country on a “Building Wealth Tour,” where he gave wealth management seminars to church congregations. During this tour, Taylor claimed to be a socially conscious investor and falsely claimed that 20% of profits were donated to charity. One of the churches on the “Building Wealth Tour” was the New Birth Missionary Baptist Church in Lithonia, Ga. While there, Taylor and Connor met potential investors to discuss possible investments. Over 80 individuals from Georgia lost more than $2 million because of Taylor’s scheme.
The investments pushed by Taylor included investing in promissory notes, where the funds invested would be used to support small businesses, such as laundries, juice bars, and gas stations. Taylor is alleged to have falsely represented the revenues and returns for these businesses knowing that they were not profitable.
Taylor also pushed an investment in sweepstakes machines. Sweepstakes machines are computers loaded with various games that allow players to win cash prizes. Taylor published offering materials that falsely claimed the average sweepstakes machine would generate 300% investor returns. He also stated that the sweepstakes machine investments were 100% risk free.
Taylor allegedly knew that the investments he was touting were not profitable and that investors were not receiving actual returns from their investments.
As part of the scheme, Taylor, 31, of Overland Park, Kan., encouraged investors to use self-directed IRAs to make their investments. Many victims transferred their retirement savings to trust companies that acted as custodians for self-directed IRAs, expecting these funds to be used to fund the investments pushed by Taylor.
After victims funded their self-directed IRAs, Taylor and others directed the use of those funds. The money allegedly was not invested as promised, but rather was used to pay ongoing business expenses of City Capital, pay personal expenses for Taylor, and in some limited instances, to pay supposed returns to earlier investors.
Prosecutors say more than 80 investors in Georgia lost at least $2 million during his wealth management seminars, between April 2009 and October 2010.