Houston megachurch pastor Kirbyjon Caldwell was indicted for wire fraud, money laundering and conspiracy in connection with phony Chinese bond scheme. Caldwell officiated Jenna Bush’s wedding and has a good relationship with former President George W. Bush.
A federal grand jury in Shreveport, La., returned a 13-count indictment against Caldwell and Smith. The men were also sued by the Securities and Exchange Commission (SEC) on allegations that they violated financial laws.
According to court documents, Caldwell, the senior pastor at Windsor Village United Methodist Church, and Gregory Alan Smith, raised nearly $3.4 million through a Chinese scheme to defraud 29 investors from April, 2013 to August 2014. The men promised investors they could earn up to 15 times the value.
The indictment states that Caldwell and his wife are co-owners of LDT, LLC, which “received and held investor funds.” In July 2010, Smith was permanently barred from association with “any FINRA member in any capacity” because he commingled “investor funds in his business account and for misappropriating investor funds,” according to the indictment.
“Once an investor agreed to invest, Caldwell instructed the investor to wire transfer payment to either a bank account controlled by his attorney or an account in the name of LDT.” The money was then transferred to personal accounts held by Caldwell, Smith or a “Mexican business associate.”
Smith and Caldwell conned their investors, sending emails and text messages promising that they would be paid. They also used “elaborate explanations” as to why they were unable to sell the bonds. The indictment alleges the “excuses ranged from issues pertaining to international currency exchanges to failures of international organizations like the International Monetary Fund or the World Bank to approve the redemptions.”
Caldwell and Smith received “approximately $760,000 and $1,000,000, respectively of investor funds. LDT also received $1 million and $175,000 was transferred to Caldwell. The remainder of the money was transferred to offshore third parties. Caldwell and Smith used the funds to pay for personal expenses, including mortgage payments and luxury automobiles. The majority of the investors did not receive their money back.
Read Pastor Kirbyjon Caldwell’s indictment: