A Friendly LetterA Friendly LetterSince 1981, an independent journal of news and issues of concern to related to the Religious Society of Friends (Quakers), and like-minded persons.
Online Issues Seventh Month (July), 2000
This report is about crime and churches. It is also about Mary Washburn.
Mary Washburn was a widow when she moved from Tyler, Texas back home to Cherokee, Oklahoma. She had been gone for thirty-three years, and she returned to the old home place mainly to be safe. "There were a lot of illegal aliens and colored down in Tyler," she said candidly, "and seemed like there was a murder every weekend."
Cherokee should have been safe enough; Oklahoma City was nearly a hundred miles away, and Tulsa, another fifty.
But it wasn't. A criminal followed Mary Washburn to Cherokee, stalked her to her house, and stole all the money she had, $68,000. "There's no way in the world I can get it back," she told me.
Dick Johnston is not surprised by stories like Mary Washburn's. He's heard hundreds. It's part of his job, as Director of the National Center on White Collar Crime. He used to be with the Bureau of Alcohol, Tobacco and Firearms ("That was before Waco and the Branch Davidians," he wants me to be sure and add).
Johnston also spent several years running drug enforcement programs in Kentucky and Virginia. So he knows about crime. "And," he says, "I personally am far more fearful of the consequences of this kind of crime than I am of street crime. You can protect your body; but what do you do about somebody who charms you out of your life savings?"
What do you do? For her part, Mary Washburn is trying to raise hell. But it isn't easy; she doesn't know who to call, and the places she has called--the Postal inspectors, the FBI, the county attorney--have given her little by way of response, so far.
This report grew out of Mary Washburn's case, and several hundred more like it. Mary Washburn lost her money by investing it in a fraudulent scheme which was marketed to and through a Quaker congregation, the Cherokee Friends Church.
Such frauds are all too common today. They cost their victims billions--Attorney General Janet Reno recently admitted that the Justice Department can't put a reliable number on it, but she cited $40 billion per year as a conservative estimate. But she's making white collar crime a priority, she insists, because, "I've seen the absolute and total devastation to a victim who at first thought, This is legitimate. I'll take my chances,' and just got completely wiped out, all their life savings vanished."
In these pages, we will see this devastation too, more than once.
I became interested in Mary Washburn's plight through the church connection, because I have reported on Quaker news and issues for almost twenty years,
For almost eleven years, I published A Friendly Letter as a monthly newsletter of independent reporting and analysis of Quaker news and issues. It was the only ongoing Quaker journal written by a professional journalist.
Writing and publishing A Friendly Letter was a demanding job. The Religious Society of Friends is a small faith group, but we Quakers are fully human, and there was never a shortage of material.
When A Friendly Letter stopped, many readers urged me to keep it going. Some even offered financial help. And no similar publication has appeared to take its place.
The encouragement was welcome, but the newsletter was not an end in itself. I said then I would wait for a compelling need to be presented before taking up my reporter's pen. And then, if it was in what Quakers call right order, way would open. With the discovery of these frauds--which incidentally affected members of several other groups besides Quakers--it seemed to me such a need had presented itself.
The four months of intensive research and writing that have gone into this report were made possible by the freewill gifts of just over a hundred donors, mainly former subscribers to A Friendly Letter. This support came to $8697, and by the time this reaches print, it will all be spent. I am very grateful to all of those who supported the work, and my hopes that this report can be of service to Friends and others, like Mary Washburn.
To find out whether we achieved this common goal, please read on.
Note: This report was prepared in February, 1998. The cases described here have continued to unfold since then. Several updates are also included on this website, along with numerous photographs.
Annette Gurney has her work cut out for her.
Gurney is Assistant U.S. Attorney for the District of Kansas. On February 24, 1998 she will attempt to persuade a jury that Priscilla Deters is a crook who stole several million dollars and deserves to go to jail.
I predict it will be a tough sell. And I'm not the only one.
Listen to Dick Johnston, Director of the National Center on White Collar Crime:
"Most of the time in this type of crime, people get away with light sentences, or fines and no jail time at all. It's a challenge to get a jury to understand it, and after conviction to get the judge to understand why the perpetrator should go to jail, rather than just pay a fine and maybe some restitution."
There are several major reasons for such outcomes. Two are relevant here:
First, our society, and the law enforcement system, are obsessed with "street crime," and the fear of personal violence.
Second, and more important here, when American juries look out at accused con artists, more often than not they look into a mirror.
Street criminals have been successfully defined as alien, ominous outsiders, typically young, male and of color. By contrast, the technical term for many con games is "affinity group crime." That's because the masterminds of such schemes look like their victims; they are simpatico, and often charismatic. These features are tools of their trade, fully as important as plastic bags or an Uzi to any drug pusher. The best con artists talk like their victims, share their backgrounds, culture, religion.
So it will be here. How could a Wichita jury not include several serious churchgoers, probably of middle age or older, most of them white, and several female? And when such a group looks at the defense table, that's what they'll see:
A 63 year-old white church lady, immaculately but not ostentatiously dressed, looking hurt but with a dignified bearing. One of them.
People don't like to send their own to jail. Jail is for The Threatening Other.
I asked Annette Gurney if she thought it was a tactical advantage in this case to have Deters facing another woman as prosecutor. "That's something I don't even want to get into," she replied primly.
"But what does your experience suggest?" I pressed.
She sighed. "I've never had a case like Priscilla Deters before," she admitted.
Nevertheless, Gurney will give it her best, and she is no newcomer to going after con artists. Before joining the feds, she spent several years on the local D.A.'s staff, fighting consumer crimes of various sorts.
And she's got evidence, plenty of it. Unfortunately, though, for aficionados of courtroom fireworks, not much of it portends the dramatic. Gurney's focus will be on a series of letters, faxes and telephone calls:
Did or did not Deters mail, fax, and/or say certain things on certain dates to certain people in Kansas? That's about it. There's nary a shootout, drug deal or car chase to be found here. Arnold Schwarzenegger and Bruce Willis will not be vying for the movie rights to this trial.
About the only moment of anything like high tension in the case came early on the morning of December 13, 1994, when two investigators showed up at Deters' house in Walnut, California, carrying a search warrant.
They found what they came for: piles of paper, on desks which also bore several telephones with answering machines. While they boxed up bank records and other documents, I've been told the phones were ringing off the hook. The answering machines' amplifiers broadcast a series of angry demands for money as background for the search.
When the bank records were finally sorted out, months later, there turned out to be something like ninety-eight bank accounts connected to Priscilla Deters' business, which was called Productions Plus. Of the $6 million-plus she took in, how much money was still in them is a matter of dispute. Estimates range from over $700,000 to exactly zero.
One other very valuable document retrieved in the search was a three-page list of 58 churches and schools in 21 states. All had invested money with Productions Plus, and the list included names, addresses and phone numbers. The total amount on the three pages came to over $4 million dollars. Investigators were confident that the list was not complete, because numerous individuals had also invested in Productions Plus, and they were not included.
On the list were four institutions located in Kansas: two were Nazarene, a church in Hays and an evangelist in Olathe; and two were Quaker, Barclay College in Haviland and Mid-America Yearly Meeting in Wichita.
Remember these names. Annette Gurney's indictment is a federal case, but she plans to concentrate on what happened in Kansas; the other 20 states will have to fend for themselves.
And what happened in Kansas, according to her indictment, is that these four groups sent Priscilla Deters $875,500, which Deters promised to double in a year's time by special "matching gifts."
In fact, the Kansans got back only $642,026, for a loss on their investment of $233, 474, and $1,107,974 less than they were confidently expecting.
The loss, in federal legalese, was due to "a scheme and artifice to defraud and for obtaining money by means of false and fraudulent pretenses, representations and promises...."
There are fourteen counts of such fraud detailed in the indictment. If convicted on all counts, Deters could be sentenced to 56 years in prison and a $250,000 fine.
That's the prosecution case in a nutshell. What about the defense?
There is more speculation here. There has to be, because Deters isn't talking to reporters, nor are members of her family. Her defense attorney, Federal Defender Steve Gradert, has been hard to reach and close to monosyllabic in his responses.
But he did make one admission that has proved to be very revealing: "She has maintained her innocence, not just pled not guilty," he said. "I can't really comment beyond that."
That's not much of a disclosure; but in a way, it's enough. For her part, Gurney wearily confirmed it. Up to ninety per cent of federal criminal cases end in plea bargains. "But," Gurney sighed, "Priscilla's not going to plead."
Gradert's statement is revealing because, if Deters isn't talking, some of her supporters are; and she still has them, certified true believers. The case they present is remarkably consistent, and in summary, comes down to something like this:
Priscilla Deters is the target and victim of a conspiracy, backed by a shadowy coalition of forces ranging from, in various reports, the Vatican, to the Mafia, to a cabal of dishonest male evangelical church leaders. She does not owe anyone money; to the contrary, many of the so-called "victims" are actually in debt to her.
This is what her friends say. And while Deters may not be giving interviews, she has said some of these things to people who wrote them down. Let's listen in on one such occasion:
It's Friday in Lincoln, Nebraska. June 26, 1996. An evening service at the First Church of the Nazarene, is just finishing up. A dozen people remain behind, at first clustered in the sanctuary, then moving to a classroom. There they settle into chairs around a well-dressed middle aged woman, who talks to them earnestly for two hours.
The speaker is Priscilla Deters, and at some points she sounds as if her world is collapsing. "If those terrible wicked people had not hurt [me]," she says, "everything would be fine....If you only knew what I have been through," she sobs, "these people will not get off my back." She insists she is being "persecuted for doing good deeds."
But then she dries the tears, and turns abruptly upbeat. "I am free and clear in California," she insists, and "my businesses are thriving...they are growing all the time."
Among her listeners are half a dozen couples, Nazarene ministers and their wives. They are uneasy and confused about what they are hearing. Four of the couples have invested money, a total of more than $72,000, with Deters' Productions Plus. (Their names, incidentally, were not on the list found in the search of Deters' house.)
Most of them have been told they were buying shares in large electronic signs, which were to carry paid advertising and be placed in shopping malls. They had been assured that profits from these signs were large and steady, and from this money they would get both interest payments and matching gifts, in rapid and reliable succession.
But they are worried about their money tonight. Some have received a few interest payments, which then stopped; others have received nothing. What, they want to know, is going on? Where is their money?
Deters repeatedly assures them that "I have the money, I definitely have the money"; and "yes, the money is in a safe place where they cannot find it."
"They", this mysterious army of persecutors, seem to be coming at her from all directions, but especially Kansas.
Tonight, she wants to talk specifically about one set of persecutors: the general Authorities of the Nazarene Church, operating from International Headquarters in Kansas City. They have placed an injunction against her, Deters insists, and she pleads with the group to lobby these leaders to lift the injunction. Then she can get back to her mission and will pay back all that she owes these people, and more.
The ministers are surprised to hear that their church leadership is carrying on such a vendetta; more than one asks for evidence. Deters says she has it, and goes out to her car to get it. She returns with a stapled legal document.
A minister scrutinizes it, and finds it is an affidavit, drafted by the General Counsel for the Nazarene Church, and submitted to the California Department of Corporations. The affidavit was sent in connection with an injunction issued by the Los Angeles Superior Court in August of 1995, almost a year before. Attached to the affidavit is a letter from Priscilla's twin sister, Phyllis Beaver, to the Church authorities, pleading with them to lift this injunction.
The injunction has ordered Priscilla Deters to stop offering what the court finds are "unlicensed securities." The court also froze her bank accounts, and appointed a receiver to take over all her assets, and redistribute them for the benefit of persons and groups with claims against them.
Flipping through the affidavit, the minister sees no direct connection between the statement and what may have happened to their money.
An injunction is certainly unfortunate, he says, and others echo him. But what about our money? When will we receive the promised interest payments, and matching gifts? Several of the ministers have assigned their matching money to their churches; but no such funds have yet been sent, long after the date they were supposed to appear.
Deters' answers to these queries are rambling and evasive; she circles back repeatedly to the need to lobby the Nazarene church to lift "its" injunction. The meeting finally breaks up.
Afterward, the ministers' wives are particularly uneasy. One woman, who thinks of herself as a good judge of character, found Deters "completely unreadable." Another decided she was "either dishonest or delusional."
All the same, just to be safe, one of the ministers writes a letter to the Nazarene authorities on behalf of those present. It suggests that if indeed the church was the body sustaining the injunction, that the action be dropped, so she would have a chance to repay what she owed them. If she didn't, the letter added hopefully, legal action could be reinstituted.
"I have no assurance that the action I proposed would have been successful," the writer admits later, "nor do I know if it would have been feasible."
It is not successful, because Nazarene headquarters is not, in fact, "behind" the injunction. By late that summer, with no money forthcoming, four of the couples are writing affidavits of their own, backing up a motion by the receiver in California to hold Deters in contempt of the injunction.
A more coherent account of Deters' line of defense came from another of her attorneys, James Parker. Parker was retained in 1997 to overturn the receivership established by the 1995 California injunction. Because he is not part of the criminal defense effort, Parker talked more freely about it. And here is the substance of what he told me:
The documents pointed to as evidence in this case are phony. They have been doctored and fabricated, to paint Priscilla Deters as a criminal, and thus to hide the identities of the real perpetrators, and the massive embezzlement of funds that was the real crime that has been committed.
Put more bluntly, Deters is being framed. Wait until the trial, they say; all this will come out, and people will be very surprised.
In that case, maybe I better take back what was said earlier about a lack of fireworks at the trial. If such assertions are actually documented in court, I will be among those most surprised. To make this case, Priscilla Deters would have to take the stand. Under federal rules, Annette Gurney can't call her as a witness. But once she's on the stand, she's fair game for cross-examination. Taking the stand would be a very risky step. Adding to the risk would be the need to furnish evidence.
What kind of evidence? Attorney Parker, for instance, insists he has seen the "original documents" to support his assertions that Deters was a victim of a setup. But neither he nor the other supporters have showed anything to me, and nothing like it has turned up in the reams of court documents I have examined thus far. Further, they have declared numerous things to me as facts which I know for certain are not so.
So we'll see. And on second thought, maybe it shouldn't be such a surprise if Deters insists on mounting an aggressive, assertive case. After all, one thing my investigation has shown is that she is not merely confident of her innocence. It goes farther than that: Priscilla Deters is, and for fifteen years has been, a woman on a mission, and a divinely-mandated mission at that.
She is out, in her words, "to raise up the King of Kings."
The burning light and certainty of this mission make ashes and nonsense of a handful of calls, faxes and letters to Kansas. As the apostle Peter said it in Acts 5:29, "We must obey God rather than men."
Annette Gurney will not be talking much, if at all, about divinely-directed missions. The stern concreteness of Title 18, section 1343 of the US Code requires her to establish only whether Deters "knowingly transmitted by wire communications in interstate and foreign commerce certain signs, signals and sounds for the purpose of executing the scheme and artifice to defraud...."
In this limited context, "Productions Plus" ought to be relatively simple to portray as a fraud:
For most of a decade, Priscilla Deters told church leaders, including the Kansans, that she could do the equivalent of spinning straw into gold: she could double their funds in a year's time, reliably and without risk.
As we shall see, a few early investors in her plan did double their money, and more; and word of this spread quickly. Church leaders being no more immune to greed than anyone else, scores of them, including many prominent Quakers, flocked to invest in her plans and recruited others to do the same.
In strict financial and legal terms, Deters was actually running a Ponzi-type scheme. There was in fact no magic process for doubling funds; instead, early investors were paid off with the funds from later investors, and when these funds finally dried up, the operation collapsed in a tangle of losses, litigation and the current criminal charges.
Seen from this narrow perspective, there is nothing new, and little that is striking about "Productions Plus." Ponzi schemes have been around a long time, in both secular and sacred garb, and despite warnings from authorities, show little signs of slowing down. If Annette Gurney gets this message across to the jury, she should win her case.
But a conviction on those terms will not produce any real understanding of what Priscilla Deters and Productions Plus have been about for fifteen years. The full story is much more complex, bizarre and grotesquely fascinating than anything Annette Gurney will be presenting.
To begin to approach such understanding, we need to look far beyond that Wichita courtroom.
The Possibility thinker's Creed:
"When faced with a mountain,
I will not quit!
I will keep on striving
until I climb over
find a pass through,
tunnel underneath,
or simply stay and turn
the mountain into a gold mine--
with God's help!"
--Robert Schuller, pastor of the Crystal Cathedral
Allow a journalist a momentary flight into fantasy.
Hard by Disneyland, the Crystal Cathedral rises out of the asphalt, its thousands of glass panes reflecting the California sunlight. From this prototypical, world-famous megachurch, Robert Schuller has preached what he calls "possibility thinking" for years, to an audience of thousands in the sanctuary, plus millions more who watch his "Hour of Power" broadcasts, read his books, attend Possibility thinkers' conferences, play the Possibility Thinker board game, or nowadays tune into his website.
I'm imagining a Sunday morning in, say, 1982. The large Cathedral choir is singing their hearts out, perhaps in one of the large concert performances the Cathedral mounts periodically. The music might even be original, composed by the church's talented staff.
In the choir is Priscilla Deters. She has been a gospel singer all her life. And she has needed the comfort and inspiration of the music. It has helped her through a recent divorce and other family traumas. It has also been a source of prestige, and money.
On this imagined morning, Priscilla Deters does more than sing, however. Amidst the music, she has a vision. It is a vision of a ministry all her own, one which would take her talents and make of them a way to, in one of her favorite phrases, "raise up the King of Kings." As God blesses me, she realizes, I will be able to return a portion to others in the work of the church. God will use me and this work as a channel for his blessings to his people.
What kind of blessings?
Money. Everywhere she looks, there are ministries--churches, schools, missions--and they all need money. The arts can be a way of assembling money for these ministries: especially multimedia concerts, which bring together lights and images with music, and when done right can draw large, paying crowds.
How is this to happen? After all, Priscilla Deters is a schoolteacher, running classrooms rather than ministries. She has several children in school, with college coming on. Her elderly mother is in frail health. How is all this to happen?
She is not worried. If she was a Quaker, she would say, "Way will open." But at the Crystal cathedral this is phrased another way:
"When faced with a mountain,
I will not quit!"
- - - - - - - - - - - - -
Let me be clear: I have no hard evidence that the event just described really took place.
But I venture this scenario because something like it must have happened. Or at least, that is what Priscilla Deters appears to believe, and what those who still stand behind her believe also. She is a woman on whom God has placed his hand. And the setting is accurate: Deters did sing in the choir of the Crystal Cathedral, for years.
In fact, Priscilla Deters has been singing in church most of her life. Tom Claus, an old acquaintance, recalled seeing her and her identical twin sister Phyllis featured at Wesleyan-Nazarene church conferences in Indiana in 1947. They were twelve, and Claus just a few years older, a "preacher boy" headed for what would become a career as a missionary to Native Americans. Priscilla and Phyllis Kuhn, as they were known then, held center stage as the "Gospel Sunshine Twins."
"They sang so sweetly, with wonderful harmony," Claus reminisced, "and they looked so cute, dressed just alike."
Their polished performances were clearly the fruit of much practice. One friend was told the Kuhn girls had been singing together since they were three years old; college classmates were informed that they had sung on the radio as children in their home town near Akron, Ohio. They were still singing when they enrolled in Marion College--now Indiana Wesleyan University--in the early fifties.
Marion College, which is not far from Indianapolis, was a sober place then--bobby sox were prohibited, and daily chapel services were required. The more modestly a student dressed, the better. Women played sports in culottes, and the men's basketball team took the court in long pants. Dancing, of course, was verboten.
But if there was no dancing at Marion College, there was plenty of music. Indeed, joining a musical "gospel team" was a way to gain status on the campus. The teams were coed groups of four or five, which combined singing with preaching (by the male members). Teams got to travel on weekends to various church events.
Naturally, the Kuhn twins were prominent team members. And they were high-profile students, with flaming red hair, who managed to look atypically stylish in their dress while keeping within the letter of the rules. Priscilla graduated in 1957, and Phyllis, who reportedly had health problems, earned her degree two years later. Both majored in music.
Diplomas were not all they got at Marion, however. Priscilla met and married Leonard Deters there, and Phyllis fell for the campus minister's son, David Beaver.
From there the trail gets cold for awhile. Phyllis settled in Akron. She has told people of being the organist for Rex Humbard, who was one of the early generation of television evangelists. Humbard built a large church, the Cathedral of Tomorrow, in nearby Cuyahoga Falls. By 1968, Priscilla was a schoolteacher in California, with four children. She also joined the Crystal Cathedral, and sang in the choir. In 1980 she and Leonard Deters were divorced.
Priscilla is fiercely proud of her 25 years as a teacher, and mentions it often. She says she taught English, French, and, of course, music. She spent her career in Hacienda La Puente, a district east of Los Angeles. She retired in 1983, and did substitute teaching for three years thereafter.
The story goes that during these years Priscilla's boundless energy could not be contained within the limits of classroom and family. "While I was a teacher I became involved in a variety of fund raising activities," she told a California court.
One such effort, from the early 1980s, was called "Savings Plus", and it was the direct ancestor of Productions Plus. School groups agreed to sell Savings Plus discount cards, and they kept part of the purchase price as a commission. Buyers used the card to get discounts at various local merchants. Such discount cards, in various guises, are widely-used marketing devices.
The logo for "Savings Plus" was almost identical to that of Productions Plus, and clearly the germ of the operation can be found here. "Every dollar, rightly divided, will multiply," one of its early brochures announces.
Another asks groups, "Do You Want To receive NEW Cash Resources WITHOUT Added Time...Money & Work...? JOIN...THE SAVINGS PLUS PERPETUAL FUNDING PROGRAM." (All emphasis is in the originals.)
The "funding program" appeared to boil down to continued efforts to sell the cards.
Over ten years, and in millions of words, the nub of Deters' message did not get much more elaborate than this.
Savings Plus was not overtly religious, but for the spiritually minded, the subtext could be read in a caption at the bottom of one of its flyers, which summed up the program as: "COMMUNITIES HANDLING RESOURCES INVOLVING SERVICE TOGETHER", whose first letters spell CHRIST.
As proudly as she looks back on these modest origins, it is evident that Savings Plus never amounted to much. Its real significance was as a stepping stone to a bigger stage. Deters' first big break came when she got out of town.
"In 1983," she wrote later, "I was asked to assist in the Spirit of America Walk for Hunger' by Bob Wieland, a paraplegic Vietnam War Veteran who was walking on his hands across America." She left teaching to become project manager for the Walk. Deters helped organize the logistics and publicity for this pilgrimage.
Along the walk's route, she said, "I developed relationships with charitable organizations in each community visited, and a fund raising program for purchase of food which was distributed along the Walk." She also organized concerts, video displays, banquets and other events. Wieland, who had recovered from his war wounds to become a champion power lifter, gave displays of his prowess at most major stops on the tour.
Clearly Deters enjoyed this work. There's also reason to think she saw great profit potential in such charitable promotions, especially on a national scale. And the combination of religion, performance and money was one she had seen, often at close range, since the childhood career of the Sunshine Gospel Twins.
Productions Plus, Priscilla Deters proprietor, was first registered as a business in Los Angeles County on January 9, 1984. Clearly the idea was to combine the fundraising idea behind Savings Plus with the kind of "productions" Deters had put together for the Walk.
Priscilla Deters, it seemed, was on her way. And she was thinking big; after all, she had a vision.
Productions Plus didn't exactly take off like a rocket, though. To get to the larger stage she knew was out there, Deters needed more than a business name. She also needed, among other things, a partner, friends who could open doors, some capital, and above all a hot property, something she could promote.
Some of these showed up soon enough. Her sister Phyllis came west from Ohio, and they have worked together, with that particular solidarity of twins, ever since.
The problem of capital fell into place beginning in 1987. The money came from another friend, but in a rather striking manner.
The friend was Wayne Ashworth, who was the Director of Development at the Whittier Christian School. The school is a large one, with 1300 students in eight grades, associated with Calvary Baptist church. As Ashworth later told it, he began loaning Priscilla money in 1987. Over the next two years, he made ten loans to her, totaling $234,000.
The terms of the loans were generous: they were not due for eight years, with no payments in the meantime, and they were unsecured; interest was at eight per cent.
The most striking fact about these loans was that they weren't Ashworth's money. They all came from the funds of the Whittier Christian school. Further, Ashworth later testified that no one at the school knew about or approved the loans except himself.
Why was he loaning the school's money to her?
"We felt," Ashworth said--without explaining who else the "we" included--"that Priscilla Deters with her company of Productions Plus had great potential in the business world and a great deal of confidence in her personally and her expertise in marketing."
But there was institutional self-interest in it as well: "She was also looked at as a very viable potential big donor to the school. And I cultivated that gift possibility because that's my work." He also acknowledged that he loaned Deters an additional $11,000 of his own personal funds.
Here I'm obliged to pause and reflect:
Maybe it's only a reporter's ingrained cynicism, but this explanation sounds incomplete. Was Ashworth really authorized to put almost a quarter of a million dollars of his school's money in play on his own hook, without security, and without reporting it? All this in order to cultivate a potential future donor?
The idea strains credulity, as they say. But if he wasn't, then why did he do it? What else, I wonder, could have been going on between him and Deters?
But perhaps I just have a suspicious mind. Over the years, lots of church people, men and women, opened their checkbooks wide for Priscilla Deters; they believed in her. "She was very persuasive," is a remark others have made to me again and again. Among so many, why not Ashworth?
In any event, the first of these loans came due on December 14, 1994. That was exactly one day after Deters' home was searched and her records taken. Ashworth said she asked for an extension of one year on the loan, and he agreed.
But 18 months later, in July 1996, Ashworth testified that none of the $234,000 had yet been repaid; though he had received about half the $11,000 of personal loans back.
When all these transactions finally came to light, Ashworth lost his job. Shortly after giving a lengthy statement to the California receiver in July of 1996, he dropped out of sight. Attached to his statement were copies of the ten loan notes, all signed by Deters and her sister.
But was Ashworth fired because he had been freelancing, or simply because the money was not paid back? Whittier Christian Schools officials pointedly declined to be interviewed, so we don't know what they were thinking.
We do, however, have some idea of what Deters' reaction to Ashworth's statement was: Her lawyer, and her supporters, now say it is a pack of lies. Perjury.
What really happened, according to her local attorney James Parker, is that Ashworth embezzled the money, then falsified loan notes to make it appear as if Deters had received the money, when in fact she hadn't. Further, Deters told Parker, her signature on the notes was coerced by Ashworth with threats that if she didn't sign them he would kill himself.
My credulity is showing more strains here. And not just mine: Richard Clements, the receiver, had never heard this line of explanation til I recounted it to him, and he also had questions. "If that was true," he said, "why didn't her attorney raise it right then, to discredit him? Or one of her earlier attorneys?" (Deters has changed lawyers frequently.)
Good question. Deters' attorney at the time was Michael Bertz. He was on hand for Ashworth's sworn statement, and gave little advice beyond reminding him to tell the truth and stick to the facts. He made no challenge whatever to Ashworth's assertions. When I contacted Bertz, he declined to comment on his role in the deposition, or on Ashworth's credibility.
Clements made another telling point, which will also get us back to our narrative:
At the beginning of 1989, Deters deposited in her Productions Plus account a little more than $234,000, about what Ashworth had loaned her .
"Where else did she get that much money?" Clements wondered. "I've seen no indication that she had that kind of capital."
Good point.
But wherever that block of capital came from, Deters was ready to put it to work, in two ways: as bait to attract new investors--and as a down payment on the hot property she had been seeking, the one she was sure would be the bottomless gold mine needed to fulfill her vision.
When Priscilla Deters fattened her bank account with that $234,000, a new minister joined the staff of the Crystal Cathedral.
His name was T. Eugene Coffin. He had been associated with the Cathedral for years, with such titles as "Chaplain of the Tower" and "executive pastor." What this actually seemed to mean is that he was something of a liturgical utility outfielder, performing weddings, funerals, and (unusually for a Quaker) baptisms, plus doing some family counseling. He knew Priscilla Deters, and he was to become one of the staunchest and most vocal supporters that Productions Plus would ever have.
Coffin was already a distinguished evangelical Friend. Born in India of missionary parents, he had been a star at Oregon Yearly Meeting's Pacific College (now George Fox University) in the mid-1930s: handsome, athletic, charismatic, with a beautiful singing voice. He was on the George Fox Board for many years, serving as chairman for several terms.
Coffin had earlier served as pastor of the East Whittier Friends Church in California, from 1969 to 1976. These years happened to overlap the tumultuous rise and fall of the church's most illustrious member, Richard Nixon. The president had called Coffin to the White House several times to preside and preach at his White House worship services there.
As the Vietnam war dragged on and Watergate unfolded, East Whittier received formal appeals from more than 200 Friends meetings asking for Nixon's disownment from the Quaker fold for his perceived departures from Quaker testimonies on peace and truthtelling. It was Coffin who announced their reply, which was that they were not about to do any such thing.
This response may have shocked the liberal Friends who sent those minutes, but in his home constituency, Coffin's loyalty to a famous and powerful native son was expected and honored.
The association with a president, followed by his elevation from little East Whittier to the glittering magnificence of the Crystal Cathedral, further burnished Coffin's reputation and put him virtually beyond criticism among evangelical Quakers. Deters rightly judged that Coffin's name and recommendation could open many Quaker doors.
Indeed, if anyone deserves the melancholy credit for turning Priscilla Deters loose on Friends, it is unmistakably T. Eugene Coffin. As my research made plain, all roads among Friends lead back to him. And these paths converge at the Friends Ministers Conference which he chaired in Denver, in April of 1989. In confidence games, a key role is that of the "roper," a person who, whether wise to the scheme or not, works to "rope in" new victims, or "marks." All available evidence indicates that Coffin was Deters' key roper among Friends.
The 1989 Conference was the fourth in a series that were held every five years. It had originally been called a Friends Pastors Conference, but this was changed for the 1984 gathering in a bow to traditional Quaker nomenclature, and to accommodate the sensibilities of the handful of attenders who came from the non-pastoral Quaker groups.
Deters' introduction to the planning committee was best described by an Investigator for the Kansas State Security Commission, Gary Fulton. Writing almost six years later, in support of the application for the search warrant, he said:
"Dr. Eugene Coffin...told [the]...Committee about this exceptional' investment program being offered by Deters d/b/a Productions Plus to non-profit charitable organizations. Dr. Coffin told [Maurice] Roberts and other Committee members that Deters would match dollar for dollar all investment funds placed into her charitable gift giving program in a fifty two (52) week time period.
"Dr. Coffin assured the Committee that deters was a highly respected and religious business woman who could be trusted with their investment funds.
"Based upon the representation of Dr. Coffin, the Committee decided to invest by mailing a $5700 check to Deters...in early 1988."
Thus was opened Pandora's Box.
Maurice Roberts was the Treasurer of the Friends Ministers Conference. He was also Superintendent of Mid-America Yearly Meeting, which had its headquarters in Wichita, Kansas.
Unlike most superintendents, Roberts was not a former pastor, though he had taken a minor in Bible at Friends University, the Quaker college in Wichita. Instead, he had run a real estate business in Topeka, and served as Clerk of Mid-America Yearly Meeting, before becoming Superintendent.
A year after sending their deposit, with the conference date drawing near, the committee wrote to Deters asking for a "disbursement" of their matching gift. On April 20, 1989, Productions Plus sent them a check.
But the check was not for double their original deposit.
It was for $50,000, almost ten times what they had put in.
Investigator Gary Fulton later wrote, in official deadpan, that after this check arrived, committee "...members became very excited and pleased with Deters' generosity from her investment program."
Roberts had still not met Deters. But having been in business, he knew a tenfold return was remarkable to say the least, and he wanted to know how she had done it. Roberts says he asked Gene Coffin.
Coffin's answer, as Roberts recalled it, was: Simple. Deters was in the advertising business, he explained; she marketed coupon booklets, which were mailed out to people in many communities; advertisers paid to be included in these booklets. She allocated the profits from these booklet mailings in designated zip code areas to her "beneficiaries," and the Friends Ministers Conference had been the beneficiary in various areas. Evidently their allotted zip codes had been quite productive.
That neither Roberts nor anyone else raised a red flag at this point seems incredible in hindsight. What kind of legal business produces close to a 1000 per cent profit in one year?
Or perhaps it is not so incredible. Professor Arthur Allen Leff, a scholar of consumer law at Yale Law School, published a study of con games in 1976 called Swindling and Selling. In it he considered the impact of such seemingly amazing results:
"Given the exhilarating immediacy of these actual pay-outs, with real money coming into the hands of real people, it is possible in running a successful Ponzi never even to attempt to answer the fundamental question, where is all the money coming from? Or rather, it is possible for the Ponzi operator to make himself the answer: Trust me; I've done it up to now and will continue to do it.'"
Almost immediately, however, Leff qualifies this judgment with an observation that fits Coffin's explanation perfectly:
"Eventually [the Ponzi operator] will have to...indicate a source of wealth other than the later investors themselves. That mechanism need not be very plausible upon reflection...but it must be possible, publicizable, and complicated."
Whether Eugene Coffin was in fact as trustful of Deters as he seemed we do not know, and he is in no condition to tell us. We may note in passing that a person who stuck with Richard Nixon to the bitter end probably had a well developed capacity for credulity.
But in addition, this confidence was likely bolstered by the fact that between 1989 and 1994, Deters paid him an average of nearly $5000 per year for otherwise unidentified services. These payments are recorded in her financial records, as straight up fees: there is no evidence that Coffin ever loaned her money, or invested in her program. (As of February, 1998, Coffin was under full-time care as an Alzheimers patient; in a brief telephone interview, he was unable to respond coherently to questions about these or other matters.)
What was Deters buying from Coffin with these payments? Arthur Leff had one answer:
"If the Ponzi operator can manage to procure--corruptly, falsely, or through luck--the names of successful plungers or, at least, apparently sophisticated operators to associate themselves with the game, so much the better."
However sincerely Coffin was convinced of the integrity and promise of Productions Plus--and he stuck by her until his health broke down, in 1995--some other evangelical Quakers had doubts.