A former bishop of the African Methodist Episcopal (A.M.E.) Zion Church — a historically African American church that dates back to 1796 — was arrested yesterday on charges that he defrauded several congregations by illegally taking control of their buildings, then using that property to obtain $14 million in loans for his personal needs.
Staccato Powell, 62, was first elected as a bishop in 2016 and he quickly put his plan into action. As a lawsuit put it last year, then-Bishop Powell told one church under his jurisdiction that the Book of Discipline (“the governing document for the national AME Zion Church”) required them to sign their building over to a newly created entity called the AME Zion Western Episcopal District (WED). That was nothing more than a creation of Powell and his co-conspirator Sheila Quintana, who was also arrested yesterday.
The way Powell put it, transferring the church to WED’s control wasn’t just the right thing to do for religious reasons; it was going to help other churches too.
When some church leaders objected to that plan, Powell had them removed from positions of leadership, the lawsuit claimed. Eventually, he transferred the property all by himself… to himself. He allegedly did this with other churches, too, and it helped him secure “22 short-term, high-interest loans from the real estate equivalent of payday lenders.”
That lawsuit, from one particular church, claimed that Powell’s loans amounted to nearly $3.9 million — money that the church was on the hook for. If the loans couldn’t be repaid, then the church would be taken as collateral.
Last year, Staccato was stripped of his title when more pieces of his scheme were discovered… though it didn’t stop him from using the title of “bishop.” One AME leader explained to Religion News Service in September why that demotion was necessary:
Bishop Kenneth Monroe, senior bishop of the AME Zion Church, told RNS that more than half a dozen churches are in court over what denominational leaders consider an illegal transfer of deeds through an entity created by Powell that enabled the deeds to be used as collateral for loans.
As a result, at least one church was lost to foreclosure, a bankruptcy judge said.
“All we are doing now is trying to save those congregations that are in bankruptcy court,” said Monroe in a recent interview. “That’s our effort, is to save those congregations from being lost.”
That already troubling situation exploded yesterday when a federal investigation led to Staccato’s arrest on charges of “conspiracy, wire fraud, and mail fraud”:
The indictment alleges that after taking control of the church properties, Powell, Quintana, and others used the real estate as collateral to obtain high interest loans, exceeding $14 million in net proceeds. The indictment further alleges that Powell and Quintana diverted funds from the loans for their benefit, including the acquisition of properties in North Carolina by Powell, retiring mortgage debt on Powell’s personal residence in North Carolina, and cash payments to Quintana’s spouse.
This may have been a $14 million scam that was able to happen because a religious leader used his position to convince other religious leaders to just trust him. And when some of them challenged his authority, he just used his power to get them out of the way.
Religion failed to guide his ethics, and organized religion failed to rein him in.
Thankfully, secular attorneys used secular courts to obtain an indictment against Powell and his associate; they’ll appear in front of a judge next week. If convicted, Powell faces up to 20 years in prison, a fine of up to $250,000, and three more years of supervised release if he’s still alive.