Celebration Church founder Stovall Weems committed fraud, report says
Celebration Church founder Stovall-Weems “has violated the law by… committing fraud, [and] enriching themselves unjustly at the expense of the church,” Celebration’s attorneys charged in a report released Monday.
the report said Jacksonville minister, who was suspended by megachurch administrators in January, ‘brought Celebration to the brink of insolvency’ while coloring his leadership with arrogance, entitlement, greed and other character flaws. He said Weems also failed to live up to the fiduciary duties that a senior pastor like him owes to his church.
The combined costs of salary, travel, expense accounts and staff to care for Weems and his wife, Kerri, ultimately accounted for about a tenth of Celebration’s revenue, according to the report which describes the church as having five campuses and 3,745 active members.
Through a spokesperson, Weems responded that the charges were “fabricated by the trustees and their attorney as a personality assault with no real basis.”
Weems, who resigned this month of the church he is suing, continued, “…As I have always said, I have nothing to hide. That hasn’t changed. I will continue a straight path with a new ministry despite these shameful efforts.
A statement posted on the church’s website said the report’s findings would be forwarded to authorities to decide whether to file criminal charges, one of a series of steps recommended by attorneys and approved by administrators.
The report says Weems made dangerous solo decisions regarding church finances, which left Celebration with heavy debts.
After the church received a $1.1 million loan through the federal government Paycheck Protection Program last year, according to the report, Weems led the $500,000 purchase of a digital security called TurnCoin. Pandemic-era PPP loans were designed for businesses to keep employees on payroll or to cover a limited list of other expenses, like rent and mortgage payments.
PPP loans are forgivable when used for authorized expenses, but the report says the church’s financial records indicate that none of the loan money was spent on authorized uses.
In March, a spokesperson for Weems told the Times-Union that “the TurnCoin investment did not use any of the church’s PPP funds.”
The spokesperson then said that the purchase of TurnCoin was part of the creation of a retirement fund for long-time employees of the church, which opened in 1998.
In addition to the $100,000 invested in TurnCoin for Celebration, the report says investments were made on behalf of two church-spin-off organizations, Honey Lake Farms and AWKNG, as well as an independent church ministry in Nevada.
The report argues that Weems received a financial benefit from digital security purchases.
“Weems pooled these funds with others so that he could be considered a ‘legacy investor’ in TurnCoin,” said the report from attorneys at law firm Nelson Mullins. “Former investors were entitled to be reimbursed before other investors and were entitled to 10% interest on their investment.”
The report said Weems was turned down when he approached a fellow pastor and friend, apparently from the Nevada ministry, about investing in TurnCoin, so he told Celebration’s accounting staff to transfer $100,000 to the outside ministry for revival. . The pastor of that ministry later told Celebration staff that Weems told him to spend the money on TurnCoin as part of Weems’ legacy investment. The money was not used for a revival, according to the report.
In addition to the digital currency deals, the report flagged the fact that the church had paid just under $1.3 million for a parsonage on Black Hammock Island in June 2021, a 50% markup on the price from when a company controlled by Weems bought it just four months earlier.
The report also says Weems was involved in a “fraudulent misrepresentation” when he applied for a bank loan for Honey Lake Farms, Inc. The report says Weems filed a financial statement that incorrectly listed a $1.4 million loan. dollars from the church as a debt owed. at Honey Lake Farms, and that when a bank loan officer told the church about it, Weems told the church accountants to just write off the money that was owed to the church. Weems did so without telling anyone about his board, according to the report.
“Fraudulent manipulation of … financial statements and unauthorized cancellation of debt in connection with a loan application violates Florida law and federal law,” the report said.
The report says Weems made a series of financial decisions without telling his board at the same time as the church’s finances suffered. Between October 2020 and March or April of last year, the church’s cash balance fell from $9 million to $2 million, according to the report.
The report is a public explanation of a situation the church initially avoided making public after Weems was suspended.
Attached to this report were recommendations for action which, in addition to accepting Weems’ resignation and forwarding the report to law enforcement, included removing Weems from any position of authority in the church. , Honey Lake Farms, Honey Lake Clinic or AWKNG; requiring a range of organizations to repay church loans; and removing the Weems from the parsonage to sell it.