The Department of Justice indicted Sherman S. Smith, 73, formerly the executive pastor of Sonrise Church in Clovis, on seven counts of wire fraud totaling more than $2 million Thursday.
According to documents filed in federal court in Fresno, Smith allegedly induced investors, including church congregants, to give money to the church by representing that the money would be used to finance a real estate development project for the benefit of the church.
The project was to be built at Ashlan and Locan avenues.
Pastor Used Funds for Personal Expenses, Investments
Smith made appeals from the pulpit, via email, and in-person for monies to pay off the church’s mortgage and fund an income-generating development, according to a news release from the office of U.S. Attorney McGregor W. Scott.
Smith collected cash, checks, and rolled-over retirement accounts to fund the church’s project, but he did not disclose to investors that he used the money for personal expenses, to operate a publishing business, and to invest in foreign ventures, federal authorities said.
Previous Fraud Conviction
The pastor has previously served time in prison for fraud. In 2004, a federal judge sentenced Smith to 37 months behind bars after he pleaded guilty to securities fraud.
From 1986 to 1993, he was pastor at Napa Valley Baptist Church and the author of Christian-themed financial self-help books,
The FBI investigated the current case against Smith, who now resides in Monterey. Assistant U.S. Attorney Laura D. Withers is prosecuting the case.
The charges come with a potential sentence of 20 years in prison if Smith is convicted.