The jury hearing the conspiracy and fraud trial of an import-export company founder accused of bilking religious investors out of $65 million is expected to get the case this week.
Nearly 100 witnesses ranging from accountants to investors to pastors, including televangelist Benny Hinn, have testified so far in the trial of Greg Setzer, 49, his daughter Charnelle; his sister-in-law Deborah and his business associate Thomas Henschke.
The charges stem from their work with IPIC Investments, Inc., a company Greg Setser started in Canton, Texas and then based near Los Angeles. The company also had offices and warehouses in Florida, Panama, Greece, Germany and other locations.
Setser recruited as investors well-known religious leaders like Hinn and through them, convinced their followers, promising big profit shares.
Closing arguments are set to begin Monday in the trial that enters its 24th week.
Federal prosecutors argue that, as CEO and chairman, Setser operated a massive ponzi scheme, paying off bogus profits to early and influential investors using money from other investors.
Beginning in 2000, the company brought in $173 million from churchgoers and their leaders, using $115 million to pay off some investors, while others lost everything, prosecutors say. The remaining millions funded the family’s extravagant lifestyle, helped maintain the company’s facade and almost none went to operating a legitimate import-export business, the government alleges.
Greg Setser’s attorney, Don Templin, has argued in court that IPIC was an operating company with clear assets and active business deals, not a ponzi scheme. The defense has said Setser should not have trusted business associates who misled him. Templin has said Setser tried his best to save the struggling company.
Attorneys for Charnelle Setser, the company’s business manager; Deborah Setser, vice president of a side company; and Henschke, who ran some of IPIC’s Florida operations, have said their clients did not have enough information to know of any possible fraud at IPIC.
The prosecutors and the lawyers for Deborah and Greg Setser declined to comment Friday. Attorneys for Charnelle Setser and David Henschke could not be reached.
Setser’s wife and IPIC vice president, Cynthia, and the Setsers’ son and company officer, Joshua, each pleaded guilty at the start of the trial to one count of securities fraud.
“Many people lost more than they can afford to lose, in some cases, their entire life savings,” said Dennis Roossien, Jr., who handles investors’ claims from the federal government’s successful civil case against Setser. “There was also a loss of faith and trust in many churches, which were, in every other respect, doing the Lord’s work.”
The U.S. Securities and Exchange Commission found IPIC liable for investors’ losses in 2004, and has liquidated its assets, including a $2.2 million yacht, a helicopter, two small airplanes, a Hummer and several other cars, said Roossien, the court-appointed receiver.
The government has been able to return about 16 percent so far of what investors lost, he said.
Pastor Reece Bowling, who invested thousands in IPIC, helped set up a separate fund to recoup ponzi payments and distribute the money to investors who lost out. It has raised almost $9 million.
“We were all victims, because obviously everyone was taken in,” said Marion Neiser, a spokeswoman for Bowling, who is with Marilyn Hickey Ministries in Colorado.
Roossien said IPIC also bought an unused geothermal plant in Northern California, four houses that the family used and a non-producing coffee plantation as part of their investment schemes, which included 20 side companies.
IPIC told investors it bought electric scooters, condoms, paint, lemons, seashells, wrought iron crafts and other items, reselling them to major U.S. stores and other buyers.
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