Fleecing The Flock: Con artists scam $80 million from churchgoers*

POSTED: 10:42 am EDT June 23, 2008

COLUMBIA, S.C. -- The three men, claiming to have been rescued from
financial ruin by divine intervention, went to homes and churches across
North and South Carolina spreading tales of financial rescue. With an
investment of just pennies on the dollar, they promised an end to credit
card debt, mortgages and hefty car loans.

And word of the "3 Hebrew Boys" spread. Small meetings in living rooms
grew to fill church meeting halls and hotel ballrooms, with followers
wooed, authorities now say, by promises of massive returns from
investments in foreign currencies.

Tony Pough, Timothy McQueen and Joseph Brunson -- three men who attend
church together -- created their endeavor in 2005 and named it after a
tale in the Bible of three people who were thrown into a fiery furnace
but spared because of their faith in God. Stories of their investment
plan spread quickly thanks to believers who recruited new clients on
military bases and in churches.

By the time authorities moved in, at least 7,000 investors from two
dozen states had handed over $80 million. But barely any of it was
invested -- less than $40,000, according to state and federal officials
-- while the men bought a jet, luxury cars and tickets to football
games, court documents show.

A federal grand jury indicted the men on 35 counts of mail fraud Friday
and they were charged with securities fraud in state court last
September. A judge has frozen $17 million the Hebrew Boys had in bank
accounts and that money remains in limbo as the men await trial, which
means investors aren't able to collect any money until the case is resolved.

But some of their so-called victims have become their staunchest
defenders, holding rallies in support of the men who face decades in
prison if convicted.

One investor, Henry Lewis, said he had no problem until the state got
involved. Lewis refused to say how much he invested but said the men
kept every promise to pay him back before the money was frozen.

"I was looking for financial freedom. I'm tired of being in debt," said
Lewis, of Ladson.

Authorities said they aren't surprised by the fierce defense of the men,
in part because they enlisted respected pastors, deacons and retired
soldiers to help pitch the plan. They also relied on trust built around
race -- the three defendants are black, as are about 90 percent of their
investors, authorities said.

"That's the nature of a well-organized scam. You recruit highly regarded
and trusted members of a specific community and get them on board to
endorse your product," said Mark Plowden, a spokesman for South Carolina
Attorney General Henry McMaster.

The men pleaded not guilty to the state charges and an initial federal
charge filed last month. McQueen refused to talk when reached at home. A
phone message for Pough was not returned. No one answered the door at an
address Brunson left on his bail forms in a subdivision along a golf
course. Their attorneys either did not return messages or declined to
speak about the case.

In a bankruptcy filing last year, the men attached a note to court
documents that said they were working to free their clients by "removing
the shackles of bondage."

"Give us liberty, or give us death; but we shall not sit by, and watch
Satans (sic) handiwork, enslave, kill, torture, and spiritually deaden,
our brothers and sisters in the Kingdom," the document reads.

Three Hebrew Boys was born from the ashes of another failed scam,
according to prosecutors.

Down on his luck in 2004, Timothy McQueen met a man involved in an
investment plan in Kentucky called the Health & Wealth Co-op, who
offered to share his secret to making money, according to the FBI.
McQueen, now 50, brought Pough, 46, and Brunson, 44, into the program,
which was shut down after three people involved were indicted in
November 2006, authorities said.

Three Hebrew Boys and its companion company, Capital Consortium Group,
were founded in early 2005 and expanded slowly, attracting just 223
investors that first year. They emphasized the investments could be used
to pay off debt and said they were investing the money in foreign
currency exchanges that banks kept secret. They said those markets offer
returns of 200 percent and 500 percent daily, authorities said.

At one seminar, a presenter promised an attendee with $40,000 of credit
card debt that they could pay a one-time fee of about $5,000 and, in 13
months, be sent a check paying off the whole debt, according to a sworn
statement from an investigator with the South Carolina Attorney
General's Office.

But records show the men spent the money on everything from a $5 million
jet and at least 20 cars and trucks to real estate and season tickets to
Atlanta Falcons and Carolina Panthers games, and returned just small
pieces of their clients' principal investments using money from
newcomers to pay off those who had been waiting for their returns.

Investigations into the men continue, with authorities saying more
charges could be filed.

Three months after they were first charged, nearly 100 supporters of 3
Hebrew Boys rallied outside South Carolina's Statehouse, calling for
investigators to leave the men alone.

"Most of the folks I know have total confidence and faith in these boys,
and we have not seen anything that they have done wrong to cause what
we've seen happen in the last year or so," said William T. Ford, a
pastor at a Baptist church in Fayetteville, N.C., who made the trip to
support the men.

He said he thinks authorities failed to find what they expected when
they began looking into the program and don't want to admit they're wrong.

"All of the folks that I know who got involved with it are people of
integrity and they have total faith and confidence in the program," Ford
said.