Church Elder Ordered To Repay $4.7 Million To Fleeced Flock

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CHURCH ELDER ORDERED TO REPAY $4.7 MILLION TO FLEECED FLOCK

Posted March 18 2003

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A church elder was ordered by a federal judge on Tuesday to pay more than $4.7 million in restitution to almost 50 victims of a Ponzi-like con game – many of them elderly members of his own congregation.

Financial consultant and ex-missionary Raymond L. Knowles, a former resident of Pembroke Pines and Opa-locka and more recently San Antonio, Texas, was sentenced to 57 months in federal prison in January by U.S. District Judge Donald L. Graham for defrauding elderly and financially unsophisticated investors during a multimillion-dollar securities fraud scheme. He was convicted last October of 16 counts of mail fraud, four of wire fraud and four of securities fraud.

Many victims were fellow members of the same Jehovah's Witnesses congregation where he was an elder.

According to a statement by South Florida U.S. Attorney Marcos Daniel Jimenez, Knowles used his position as an elder to sell millions of dollars worth of risky promissory notes to worshipers, falsely representing that the investments would return between 8.5 percent and 20 percent. He also was accused of diverting investor funds to lease luxury cars, pay personal, business and other expenses including trips to South Africa and Disney World near Orlando.

A Ponzi scheme is named after Charles Ponzi, an immigrant who ran such a scheme in 1919-1920. It involves an investment scheme in which returns are paid to earlier investors, entirely out of money paid into the scheme by newer investors.

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