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State: Christian fund paid for excess
More articles on this topic: Nakami Chi Group Ministries InternationalNon-profit’s co-owner bought jewelry, auto, share of a golf course
A pair of 2-carat diamond earrings. A gold ring. A down payment on a house.
These are just some of the items purchased with funds from a non-profit company that told investors in Arizona and 12 other states that their money would be used to fund Christian charities.
Newly released court documents in a state fraud case show that a co-owner of Nakami Chi Group Ministries International used the non-profit firm’s checking account to buy over $300,000 in items, including high-end custom jewelry and a new car.
A state investigator says the purchases were made with investors’ money.
The co-owner, Ed Purvis, also invested money in a golf course and restaurants, documents show.
State investigators say Nakami co-owners Purvis and Gregg Wolfe, both of Chandler, have raised more than $7.5 million from elders, pastors, churchgoers and other investors, including members of at least two Phoenix-area churches.
Investors have defended Nakami. They said they were promised 24 percent annual returns and donations by Nakami to charities.
State and federal authorities launched investigations and accused the owners of running a complex fraud targeting religious members.
Purvis and Wolfe maintain they have done nothing wrong and are targets of a witch hunt. They have mailed unusual claims demanding millions of dollars from nearly every person involved in the case, including a Maricopa County judge, state lawyers, investigators, potential witnesses, some investors and The Arizona Republic. Citing admiralty law that governs navigable waters, Purvis and Wolfe argue that the state has no jurisdiction in the case. Neither could be reached for comment this week.
In seeking to shut down Nakami, state investigators filed documents saying its owners were tapping investor money for shopping sprees and side investments.
State special investigator Ronald Baran wrote in a search-warrant affidavit: “Investor money has been used by Purvis for gambling, legal fees, the purchase of new vehicles, to pay off the loan of another vehicle, credit-card payments, jewelry store purchases, a home purchased as an investment property, the down payment for a golf course, and an investment in a residential subdivision that went bankrupt before completion.”
The financial documents go back three years and show, among other payments:
• $4,500 to the Arizona Back Institute for Purvis’ wife, Maureen.
• $40,000 for a down payment on a lot in a Camelot Homes subdivision.
• $6,000 to Aureflam, a California chain of fast-food Vietnamese restaurants.
• $19,265 to Power Nissan in Mesa.
• $18,000 in various withdrawals and transfers to Purvis’ personal account.
The memo lines of the checks, which bear the Christian fish symbol, in some cases detail where the money went and in other cases offer praise to clerks for their help shopping.
“Thanks for taking so much time with us!” Purvis wrote on a $5,767 check to Coffin and Trout Jewelers in Chandler. “Thanks, Dean!” Purvis wrote on a $10,887 check to Coffin and Trout for a pair of diamond earrings.
The Arizona Corporation Commission, which regulates securities sold in Arizona, is seeking to shut down Nakami, fine Purvis and Wolfe and order them to repay investors. Purvis has filed an appeal and has requested a hearing before an administrative court judge.
State investigators have accused Purvis and Wolfe of misleading investors about the scope and size of its assets in order to raise revenue. State filings in the case make lengthy references to a pyramid scheme, in which funds from new investors are used to pay returns to existing ones without a real revenue source.
Purvis and Wolfe told investors that their company was worth $170 billion and controlled assets around the world, including gold mines, Australian developments, telecommunication firms, banks and a Phoenix technology company.
A Republic investigation raised questions in September about the size and holdings of Nakami, which uses a Scottsdale post office box as its company business address.
State records show Purvis is a licensed practical nurse living in a Chandler home valued at $270,000 and Wolfe is a former roofing contractor. Records also show Purvis and Wolfe do not have brokers’, lenders’ or banking licenses and have not filed paperwork in Arizona related to mines in the state.
Pastors at Vineyard Church in Avondale and Chandler Christian Church have supported and defended Purvis and Wolfe, saying there is no evidence of wrongdoing.
Officials and members at both churches have invested with Nakami, and some have reported receiving 24 percent annual returns. Vineyard Senior Pastor John Farmer said Purvis and Wolfe have promised to give his church more than $1 million for a building fund. Farmer said Thursday that he has not yet received the money.
A call to Chandler Christian Church was not returned.
“Purvis and Wolfe have continued to raise money, approximately $2 (million)-$3 million, over the past eight-10 months,” investigator Baran wrote in his October affidavit to the court. “There are also old and current international money transactions to Switzerland, Malaysia, Australia, Peru and Panama.”
Two weeks ago, Purvis filed a claim in U.S. District Court against several Arizona Corporation Commission officials, a Maricopa County Superior Court judge and the county Clerk of Superior Courts. The filing cites admiralty law, which applies to vessels on the high seas and other navigable waters.
In the claim, Purvis maintains that he has been libeled by the defendants and is seeking damages.
On Tuesday, the Arizona Attorney General’s Office asked the court to dismiss Purvis’ claim, which it described as a sham.
“His allegations against the defendants have nothing to do with torts committed on the high seas or navigable waters,” wrote Richard Albrecht, assistant state attorney general. “Purvis’ sham attempt to utilize admiralty jurisdiction to harass state officials should not be countenanced by this court.”
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