Photo: Godofredo A. Vasquez, Houston Chronicle
Kirbyjon Caldwell, a prominent Houston pastor accused of selling millions of dollars of worthless Chinese bonds, denied on Friday all allegations that he wanted to "cheat" anyone of money and this alleged believed that the gang were legitimate.
Caldwell, 64, was charged along with Shreveport financial planner Gregory Alan Smith, 55, with 13 counts of conspiracy, wire fraud and money laundering.
Federal prosecutors say that Caldwell should retain his position as the senior pastor of the United Methodist Church at Windsor Village, investing nearly $ 3.5 million in historic Chinese bonds that are not recognized by the Chinese government.
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He and Smith told investors that, according to the indictment, they saw returns equal to 15 times their original investment could.
Cald Well, and his lawyer, Dan Cogdell, has vehemently rejected the allegations, saying that the pastor returned nearly $ 1 million to investors who were apparently "dissatisfied" with the time to receive the proceeds.
"These charges are wrong," Cogdell said. "Rev. Caldwell has been a spiritual force in this city, in this state, in this country for 30 years, and if anyone deserves the presumption of innocence, it is this man."
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Caldwell, a spiritual adviser to President George W. Bush, himself said that he put hundreds of thousands of dollars in the bonds invested in the hope of being able to reinvest the money in his church. He is still waiting for a return on this investment, he said.
"These bonds are legitimate," said Caldwell. "The process is legitimate, I fully argue that the charge is groundless."
He also said that none of the investors are church members.
The charges filed by the Securities and Exchange Commission accuse the men of fraud of 29 investors between April 2013 and August 2014 for the bonds described in the indictment as "mere collective memorabilia".
"These bonds were issued by the former Republic of China before they lost power to the Communist government in 1949," US Attorney Alexander C. Van Hook of Shreveport said in a press release. "They are not recognized by China's current government and have no investment value."
Caldwell and its Wyoming-based company, LDT, are accused of investing nearly $ 2 million in the Chinese bond system. Smith received $ 1 million, and "offshore thirds, at least one in Mexico," according to the indictment, received most of the rest.
Caldwell sometimes used the alias "Turner Hines" when talking to investors and told a person the invested had about $ 800,000, according to the indictment, the bonds are covered with gold or silver.
The two men have continued to promise investors that they will be paid, according to the indictment of currency fluctuations or problems with the International Monetary Fund or the World Bank.
"Although these seemed plausible to some investors, they actually had no basis," the indictment said.
None of the investors got the money they had been promised, and most, according to the prosecution, did not even return the value of their investment.
If convicted, men could face up to 20 years in prison for conspiracy to commit wiretaps and be considered a threat of fraud, and up to 10 years in prison for money laundering and money laundering conspiracy.
You could also pay $ 1 million each.