The investments held vast promise.
Returns of up to 600 percent. Profits that would be used to build churches in Kenya and pay the education of poor students. Donations to needy ministries.In fact, more than 2,100 Christians across the country apparently believed the promises and gave Jonathan Strawder and his Sovereign Ministries International $11 million to $14 million in less than a year.
Investigators now suspect it was all a scam, and Strawder, 25, is under investigation on suspicion of fraud and selling unregistered securities.
Prosecutors are expected to file charges against him this week. He has denied any wrong-doing.
Diane and Frank Smith were told their investment would yield a return of 360 percent a year and enable them to fulfill a long-held dream of ministering to recently released inmates. The Orlando couple gave Strawder more than $47,000. They have gotten back only $6,000.
Investigators from the Florida state comptroller's office got a court-order to shut down Sovereign Ministries in March, claiming it was a Ponzi scheme in which early participants are paid with funds invested by later ones.
Strawder apparently bought sports cars, two Porsches, a Land Rover, a BMW, a yacht, a motorcycle and two apartment buildings in Chicago. A large chunk of the money is unaccounted for.
Only $1.2 million was returned to investors and another $1.2 million was kept as commissions for the salespeople, or "ambassadors," who sold individuals and church groups on the plan, investigators said. Many of those ambassadors lost their own money in the scheme.
"We trusted Jon. He had a trustful look," said Mrs. Smith, 51, who became an ambassador herself. "He was just out of college. He was getting married, and he just looked so wholesome."
Sovereign Ministries has been turned over to two court-appointed receivers, who have been able to track down $6.5 million in assets for the investors.
"When it's all said and done, we would be lucky to give them 50 cents on the dollar," said David Cohen, a receiver.
Strawder started Sovereign Ministries in April 1997, a year after graduating from the University of Florida.
According to investigators, he billed Sovereign Ministries as "a specialist in Bible economics" and promised he would invest participants' money in offshore trading programs that would yield as much as 600 percent a year.
Investigators said that to evade securities laws, Strawder made his investors sign a form claiming the deal was a charitable gift instead of an investment. The ambassadors were told to use their word "abundance" instead of "interest," "donation" instead of "principal" and "blessing" instead of "profit," investigators said.
In court papers, Strawder has denied that he sold securities and said they were gifts to his ministry. He admitted using some of the money to buy cars and a boat, but said he was just borrowing the money and intended to repay it.