Armstrong Indicted On Financial Fraud

Police made the raid as part of an ongoing criminal investigation and seized financial records and computers. In a raid evoking shades of the 1979 receivership, more than 20 officers sealed off the block-long church complex at 601 N. Tejon St., evicting the senior controversial pastor, who strode the sidewalk, a copy of the warrant clenched in his fist.

Police raided the landmark Grace Church and St. Stephen’s in downtown Colorado Springs, Colorado in a criminal investigation into whether controversial Pastor Don Armstrong embezzled millions of dollars from Grace Church.

Armstrong and his followers had split away form the Episcopal Church and joined the Episcopalian Diocese of Nigeria, whose archbishop once supported a law imposing five-year prison terms for gays and their supporters. Since then, Armstrong and his sect have kept physical possession of the $17 million dollar historic, architecturally inspiring Grace Church and St. Stephen’s.

In a ballot taken, 93 percent voted to align themselves with the conservative Convocation of Anglicans of North America (CANA). That group is aligned with the Anglican Province of Nigeria.

The members also overwhelmingly voted 348 to 22 to retain the real and personal property of Grace Church, church officials said. “I’m delighted. It doesn’t get much better than that,” said the ecstatic Armstrong, who has been at the helm of the Grace Church for the last 20 years.

Regardless of any voting, valid or not, the hierarchical governance of the Episcopal Church of Colorado wants the property and intends to fight Armstrong through the courts, if necessary, to keep what it claims is denominational property.

The question is, will the Worldwide Church of God, then file yet another amicus brief on behalf of the Episcopal Church, in favor of that denominational hierarchy, helping to wrestle away the $17 million dollar Colorado property away from church membership? WCG has already intervened in the Virginia Episcopal church property dispute, joining in an amicus filing in favor of the denominational hierarchy against the members, so Tkach has already elected to join the fight in Virginia. Judge Bellows ruled in late December in favor of the local congregations keeping their church property. The cases are now being appealed by the denomination up to the Virginia supreme court. (For more on Tkach's maneuvers, see "Religious Property Wars: Tkach Joins The Fight!)

Armstrong once led the largest Episcopal church in Colorado. But accusations arose Armstrong misappropriated hundreds of thousands in church funds. He was then placed under ecclesiastical indictment, and found guilty by the church of misappropriation of hundreds of thousands of dollars. Armstrong was found to have committed crimes, including theft of $392,409.93 from Grace Church; tax fraud, causing Grace Church to issue false W-2s and under report Armstrong's income and benefits by $548,097.27; receiving illegal loans totaling $122,479.16 in violation of church law and policy; improperty taking nearly $400,000 in church funds to pay for college tuition, or spending for personal uses; misappropriation of church funds for another $259,999; taking and alienating the church's real property without authorization; violating a temporary inhibition placed on him; using clergy discretionary funds improperly; and failing to maintain proper books of account.

Police confirm Armstrong took the some of the funds to pay for college tuition. Police found no documents signed approving the money for Armstrong's use, but a church auditor defended Armstrong's innocence.

An affidavit affirms that Armstrong misused $392,000 and that he wrote monthly checks for six years. Those were the years Armstrong's children were in college. "There are hundreds upon thousands of pages of information that need to be looked at," a police spokesman said of the lengthy investigation, "as well as computer records."

They took files of church financial documents and computers. "It has to be done that way," the police spokesman stated, "when you have those kinds of disposable evidence that someone could get rid of if they new we were coming."

"It's not clear to us that he's the only suspect," the spokesman also said, "certainly he's named in the warrant as being someone questioned about what happened to some of the monies there." The criminal investigation is ongoing, with police expected to hand damning evidence of guilt to prosecutors.

Throughout this biblical drama, criminal charges have yet to be filed against Armstrong — and who, like his namesake Herbert Armstrong (could he possibly be any relation?) maintains his innocence.

Armstrong and a few hundred of his seemingly embattled followers are refusing to leave the physical church, an attractive landmark of downtown Colorado Springs. They are now in association with the Episcopal Diocese of Nigeria. The rest of the disenchanted congregation is temporarily meeting in the building of another church nearby.

Events have become a bit humorous at times. One wag attempted to throw a throw a cream pie right in Armstrong’s face, while in the middle of one of his sermons! (the elderly Armstrong managed to hide behind the pulpit when he saw the cream pie coming). The pie-thrower was captured by members of the congregation, arrested and later claimed he was making some sort of political statement.

Also, Armstrong was photographed by the press, illegally parking his vehicle at least twice to get into the Starbucks.

There’s also the Nigerian aspect to all of this, and the Episcopal denomination's evolving position on homosexuality. Faced with the Episcopal Church ordaining more gay clergy after the controversial election of V. Gene Robinson, a gay New Hampshire bishop in 2003, and backing same-gender unions (not to mention the accusations of his misappropriation of funds), Armstrong and his followers split with the church earlier this year, and have joined forces with the Church of Nigeria, whose archbishop is Peter Akinola -- who has written:

“Homosexuality or lesbianism or bestiality is to us a form of slavery, and redemption from it is readily available through repentance and faith in the saving grace of our Lord, Jesus the Christ,” Akinola wrote in an essay.

As there have been so many statements and counter-statements flung by Armstrong supporters and the Episcopal diocese it's difficult to know the real truth about the evolving controversy. It's sure to become more interesting when Armstrong's upcoming trial Feb. 10 begins over who really owns Grace Church: The heirarchical governance of the Episcopal Church, or the breakaway group led by Armstrong.