Spiritual Advisor To Obama And Bush Sentenced To 6 Years For Multimillion Dollar China Bonds Fraud
Kirbyjon H. Caldwell, the spiritual advisor to former presidents Barack Obama and George W. Bush, has been sentenced to six years in prison for his part in a multimillion-dollar China bonds fraud scheme.
Caldwell, 67, was sentenced by U.S. District Judge S. Maurice Hicks on Jan. 13 in Shreveport, Louisiana. He and his co-defendant, Gregory Alan Smith, a 55-year-old Shreveport-based investment advisor, were indicted there in 2018.
Besides being a pastor, Caldwell, who holds a master’s degree from the Wharton business school at the University of Pennsylvania, worked in the financial industry.
According to authorities, Caldwell used his influence to convince people to invest in historical Chinese bonds in early 2013, the Associated Press reported.
Caldwell told buyers they would gain partial bond ownership and would receive large investment returns, Insider reported. Buyers were also given “participation agreements” which stated that if the sale failed, their funds would be returned.
Many of the victims were elderly and retired, The New York Times reported. Those who did not have money readily available were encouraged to cash out other investments so that they could participate in the scheme, prosecutors said.
The problem is, being historical Chinese bonds, they had been issued by the former Republic of China and aren’t recognized by China’s current government. Thus, the bonds had no investment value at all. They are actually considered to be collectibles by the Securities and Exchange Commission.
Still, the scheme worked and Smith and Caldwell raked in “investments” worth $3.5 million between 2013 and 2014. Caldwell received $900,000, which he used to maintain his lifestyle and pay down credit-card debt and mortgages, Insider reported.
“This defendant used his status as the pastor of a mega-church to help convince the many victim investors that they were making a legitimate investment but instead he took their hard-earned money from them and used it for his own personal gain,” said Alexander C. Van Hook, acting U.S. Attorney for the Western District of Louisiana.
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Caldwell must report to the Bureau of Prisons on June 22, 2021, to serve his prison term for conspiracy to commit wire fraud.
He was also ordered to pay $3,588,500 restitution and a $125,000 fine. Smith was sentenced in November to six years in prison in November.
People were shocked when news broke in March 2019 that Caldwell had pleaded guilty to conspiracy to commit wire fraud.
TV commentator Roland Martin tweeted at the time, “This is stunning. ‘Houston megachurch leader Rev. Kirbyjon Caldwell – pastor of the largest Methodist church in the country – pleads guilty in investment scheme'”
“Wow. Wow. I did NOT see that coming,” a tweeter responded. “Growing up in Houston in the church, eventually you hear dirt on every known preacher. I never heard one person say anything negative about Pastor Kirbyjon.”
Another tweeted, “I know him and his ministry has had a tremendous impact on my life. I love him and will continue to be his friend and pray for him. People of faith should extend grace to him, his family and the congregation of Windsor Village UMC. Accountability and compassion”.
Caldwell spoke at the 2000 Republican National Convention, delivered the benediction at Bush’s 2005 inauguration, and officiated his daughter Jenna Bush’s 2008 wedding, the New York Times reported.
In 2008, Caldwell supported Obama’s first presidential run and was part of a group of Christian pastors who would pray with Obama. Caldwell was also on Obama’s Fatherhood and Family task force, the NYT reported.