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Wednesday, May 28, 1997

Three indicted in church investment scheme

By MADELINE BARO / Associated Press Writer

DALLAS (AP) - A former orchestra director at a high-profile Baptist church and his wife were arrested Tuesday, accused of bilking investors out of millions of dollars to pay for lavish homes and trips.

Richard E. Kingsmore, 37; Kathy S. Kingsmore, 36; and co-defendant Charles R. Adams, 47, have been indicted on charges of mail fraud, wire fraud, securities fraud and money laundering.

Kingsmore once led the orchestra at Prestonwood Baptist Church and his wife sang in the choir. Adams was a congregant.

U.S. Attorney Paul Coggins said the defendants' ties to the church, some of whose members were among the defrauded investors, made the alleged crimes particularly unfair.

"I think it was a special betrayal when you have a trust like that ... but greed crops up in all sorts of venues, in all sorts of forums and investors have to be awfully careful wherever they place their money," Coggins said.

Prestonwood Baptist, with nearly 14,000 members, is among Dallas' largest congregations. Its March 23 groundbreaking for a new complex, which will have the largest sanctuary in North Texas when it opens in 1999, was attended by U.S. Sen. Kay Bailey Hutchison, R-Texas, and U.S. Rep. Sam Johnson, R-Plano.

The Kingsmores, who now live in Winston Salem, N.C., were arrested in Greensboro, N.C., while Adams, who lives in Grand Saline, Texas, was arrested in Tyler.

The indictment alleges that the Kingsmores and Adams defrauded investors from Prestonwood Baptist Church in Plano; the Kingsmores' former church in Birmingham, Ala.; and Mrs. Kingsmore's hometown of Somerset, Ky. The victims were promised that their money would be pooled with other investor funds and used to trade in million-dollar securities in London, authorities contend.

Instead, the Kingsmores used the money to pay for a luxury Dallas home, build a beachfront mansion in Florida and entertain friends and investors on first-class trips to London, the 30-count indictment alleges.

Last September, the Securities and Exchange Commission filed a civil lawsuit against Mrs. Kingsmore, accusing her of defrauding 34 people out of $3 million.

Mrs. Kingsmore's attorney, Carl Generes, has said his client denies the allegations. He could not be reached for comment Tuesday.

The Rev. Mike Buster, Prestonwood's executive pastor, said church members were surprised when the accusations first surfaced several months ago. "We're praying for all involved," Buster said.

Both Coggins and FBI assistant special agent Howard Apple emphasized that the church connection wasn't the main element in the case.

"This is just an issue of fraud," Apple said.

The trio were set to be arraigned before U.S. District Judge Jerry Buchmeyer on June 6. Send a Letter to the Editor about This Story | Start or Join A Discussion about This Story
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