Five former Baptist Foundation of Arizona (BFA) officials could face prison if convicted of crimes alleged in a 32-count indictment. Three other former officials pleaded guilty to reduced charges in exchange for turning state's evidence at an initial criminal hearing in Phoenix.

Five defendants pleaded not guilty at the May 4 hearing in Maricopa County Superior Court. They are William Pierre Crotts, the foundation's former chief executive officer; Thomas Dale Grabinski, ex-general counsel and vice president; Lawrence Dwain Hoover and Harold DeWayne Friend, former members of the foundation's board of directors; and Richard Lee Rolfes, an accounting consultant.

Charges stemming from a two-year investigation by Arizona's attorney general include theft, fraud, and racketeering. It is one of the largest fraud cases associated with an affinity group—in this case a religious denomination—in American history.

Sentences for the different counts carry prison terms of between 8 and 12 years. If convicted as charged, the former officials could also be forced to pay restitution to 13,000 defrauded investors. If they are convicted of racketeering, the court could go after their personal assets.

Three others targeted in the probe—former treasurer Donald Dale Deardoff; another officer, Edgar Allen Kuhn; and former board member Jalma W. Hunsinger—accepted a plea bargain in exchange for cooperating with prosecutors.

Deardoff pleaded guilty to two counts of fraudulent schemes. Kuhn confessed to three counts of facilitating fraudulent schemes and Hunsinger to three counts of illegally conducting an enterprise, less-serious felonies carrying sentences of 6 to 18 months. Sentencing for the three was delayed until after the case ends.

Attorneys for two of the defendants, meanwhile, told The Arizona Republic that the charges are unwarranted and that their clients are innocent. About $22 million was invested by churches, according to a 1999 report. Most of the BFA's top officers were drawing six-figure salaries.

Related Elsewhere

The unabridged Associated Baptist Press article above is available at the news service's site.

Christianity Today's other coverage of the Baptist Foundation of Arizona collapse includes:

Elderly Investors Target Accountant | But Baptist Foundation of Arizona victims will have to wait in line. (May 17, 2001)

Baptist Foundation of Arizona Declares Bankruptcy | Troubled agency, accused of lawbreaking, offers restructuring plan. (Nov. 9, 1999)

Baptist Foundation Faces Investment Fraud Charges | Freeze on redemptions leaves pensioners in a pinch. (Oct. 25, 1999)

The weekly Phoenix New Times, which first exposed the fraud, has its full award-winning investigative series "The Money Changers" online.

The Arizona Republic, a major Phoenix daily, also has numerous BFA articles in its archives, but charges a $2 fee to read each of them. However, many of these articles are also available free at, a lengthy, opinionated, and very informative unofficial site maintained by two articulate and angry BFA investors. has also posted the "smoking gun" letters and memos from BFA's own whistleblowers, which were ignored and dismissed by its disgraced former management.

Mainly for investors, the BFA Liquidation Trust (successor to BFA itself) has many reports, press releases, and other documents.

The counsel for the state class action suit maintain a detailed site with regular updates.

The Arizona Corporation Commission's Securities Division has many documents about its actions against BFA and Arthur Andersen:

Hundreds of pages' worth of the complete court filings in the BFA bankruptcy case are available at the District of Arizona Bankruptcy Court site.

The Investors Committee appointed for the bankruptcy case has regular BFA updates on its site as well.

There is even a dedicated BFA discussion-chat forum, where investors and others commiserate, rail, pray, and speculate daily about the chances of getting their money back and putting the culprits behind bars.

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