Friday, December 15, 2017

Should Cornerstone Ministries Investments Have Existed? – Part One

Monday, August 15, 2011, 0:00
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The Role of the Presbyterian Church in America (PCA) Stated Clerk and Administrative Committee in the Establishment of the Presbyterian Investors Fund (PIF) and Cornerstone Ministries Investments (CMI)

Part One

by Bob Wildrick


Not one person associated with the PCA as a member or an investor in CMI, Inc., has written an article that I have read on it’s demise, therefore I believe someone with experience with both organizations should write about this mess.  I am deeply disturbed that PIF/CMI was founded upon the remnants of a PCA endeavor, Investors Fund for Building and Development (IFBD), that was faulty and I am disheartened that teaching and ruling elders in the PCA refused to exercise their responsibilities in 1994 to put the peace and purity of the church ahead of loyalty to other teaching elders.

At the 13th General Assembly (GA) of the PCA in 1985 a recommendation was made:

“that the Committee on Mission to North America be authorized …to form and implement a revolving building fund to operate as a trust for the purpose to receive monies and make loans for the primary purpose of church building construction.” [1]

At the 14th GA of the PCA in 1986,  the assembly adopted the basic policy guidelines for revolving building loans.  Furthermore:

“the trustees of the Investors Fund for Building and Development were directed to complete the policy manual and submit it to the 15th GA” [2]

That assembly also approved the articles of incorporation and  bylaws for IFB&D, as well as the proposed FY87 budget and the Basic Guidelines for Revolving Building Loans. [3] At that same GA there was a report and minutes of the organizational meeting of IFBD attached to the minutes. [4]

Skip ahead to the 20th GA of the PCA in 1992.  The minutes note:

“that the 20th General Assembly requires all committees and agencies to participate in the Legal Audit Questionnaire.” [5]

Why a legal audit?  What was going on at Century Place (the denominational office building)?  Notice that it was the General Assembly that ordered the Legal Audit.

The minutes of the 21st GA of the PCA 1993 state:

“That the AC [Administrative Committee] be directed to assemble the recommendations in and responses to the Legal Audit by the various committees, boards, and agencies and to present such reports through the appropriate committees, boards and agencies to the 22nd GA, and that the parts of the Legal Audit referred to each committee, board and agency be made to the Committee of Commissioners reviewing its work at the 22nd General Assembly and that the entire legal audit and responses be made available to the Committee of Commissioners on AC at the 22nd General Assembly.”[6]

See the difference?  The results of the Legal Audit should have been given to the GA.  The GA ordered it; the GA should have seen it.  However, only a relatively few members of the Assembly ever saw the Legal Audit, and those that did had to sign a confidentiality agreement, pledging not to reveal the contents of the Audit.  As a result, the majority of the 1994 GA never saw what was in the Legal Audit.

I will now attempt to present what happened at the 22nd GA of the PCA in 1994.  Here is what we read in that Assembly’s minutes:

Legal Audit

The working definition a Legal Audit of the Committee of Commissioners on Administration is as follows:

1.07 The End Product—The Legal Status Report and Chart

The legal status report should be designed to (1) give the status of the legal affairs of a business; (2) make recommendations for future action, and (3) assist management in evaluating the present legal risks in the business. [7]

The minutes go on to say that a report of certain matters can be prepared for public distribution but things that could be used in a lawsuit should be kept confidential.  OK I’ll agree with that.  Further on in the minutes it states:

“At present the legal audit is protected by attorney-client privilege and its contents may not be used against the PCA in a court of law.  The very reason for having the legal audit conducted in the first place was to determine whether there are areas of civil vulnerability that should be corrected before being discovered by someone wishing to file suit against us.” [8]

Further on under “d” of the grounds it states:

“The legal audit report is copyrighted by the Christian law firm of Gammon and Grange…” [9]

However, when a law firm undertakes a job for a client, any material that is copyrighted is to be thus protected for the benefit of the client, not the law firm…

So what are the facts that have been kept from us for twenty-three years? You won’t find anything in the minutes of the 22nd GA other than a hint.  Under the Committee of Commissioners on Investors Fund the statement is made:

“We are not allowed to discuss the details of the Legal Audit.”

Skip down a few lines and it states:

“We found nothing in the IFBD portion of the Legal Audit, in the response of legal counsel, in the response of IFBD staff, or in the IFBD trustees to cause concern of anything amiss.  In Summary, from the information given and received, we found no substance to rumors that have circulated that there is impropriety in the IFBD” [10]

Further on in the minutes it states:

“Therefore the Trustees recommend with the endorsement of the Committee on Mission to North America and the Administrative Committee the following:.. it is recommended that the relationship of IFBD to the General Assembly be reordered in such a way as to make IFBD a separate, non-integrated supporting organization.” [11]

In simple English IFBD was dissolved by the 1994 GA.

Was there impropriety at IFBD?  Within the PCA there was a group of teaching elders called Concerned Presbyterians.  This group of men were concerned about the drift within the PCA away from historic Biblical and Presbyterian standards and polity.  A report was presented at Concerned Presbyterian Day in 1994 by attorney Walter Porr who had found twenty corporations registered to suites 130 and 150 in the PCA building at 1852 Century Place, Atlanta, Georgia, many with the names of the principals and employees of IFBD as CEO, CFO, Secretary or Registered Agent.  Mr. Porr made the statement that “the suites must be awfully large suites or very diminutive people.” Recently Mr. Porr wrote the following to me:

“I am deeply chagrined, but not sadly surprised, that the Church declined to impose any discipline.  My experiences at the GA made it clear that the moral fiber and courage for such action was woefully lacking.”

After Gammon and Grange had completed the Legal Audit, Cecil Brooks, the CEO of IFBD took a copy of the IFBD portion of the audit to Charlotte, North Carolina in May 1993 and gave it to a banker by the name of Chuck Ledford for his perusal.  Mr. Ledford states:

“I was asked by some individuals to review some information regarding the PCA Investor Fund and make comments on the legal/financial structure.  He has since then, and as per letter enclosed dated May 19, 1993, requested that I send this information, specifically a legal audit on the Investors Fund back to him.  I am doing this memo in accordance with his request.  When he was in Charlotte I did state to him that I would not copy nor reproduce any material given to me and I certainly will not do so.  The purpose of this memo is to record my own private thoughts and comments regarding the information contained within said document.  I will as of this day send all original documents, without any copies or reproductions made whatsoever, back to Mr. Brooks.”

Mr. Ledford’s memo was four pages long, but the second paragraph on the fourth page is exceptionally revealing:

“They (Gammon and Grange) made another extremely important notation in the document.  Tim Mersereau is the auditor of the Investors Fund.  He said to the audit committee, according to this document, on March 5, 1991 a discussion draft calling to their attention five reportable conditions that in his judgement could adversely affect the organization’s ability to financially and legally function.  Gammon and Grange stated that it was appropriate that this letter go to the audit committee which could have required a written response from management addressing each of these concerns and how to resolve them.  They stated that apparently no written response was requested or provided but it was brought up in the field audit and Jack Ottinger addressed them.  Such issues, briefly are:

1. the loss of a $200,000.00 savings certificate which Ottinger stated was later found

2. deposits in excess of FDIC limits

3. RTC interest computation error

4. improper rate of adjustments during the calendar year

5. personnel files lacking documentation authorizing pay raises.

They made no comment on whether Mr. Ottinger’s responses to these five things were satisfactory but went on to the next and final recommendation.

Mr. Ledford’s next paragraph was on Gammon and Grange’s recommendation to the Stated Clerks office requiring management of IFBD to submit reports in a timely manner and to respond to noted deficiencies.  He now ends with this final paragraph:

“I have briefly summarized this limited legal audit by this memo.  No copies or reproductions of the document have been made and as of today I am sending the original all of the Investors Fund financial statements for 1991 and 1990, along with a letter from Jackson McDaniel back to Mr. Cecil Brooks.  It is my financial observation that even with a cursory review of the information contained within this memo, that it is absolutely imperative that this issue be addressed in an immediate manner.  Even as I cannot give these documents out because they are copyrighted and I did give my word to Mr. Brooks that this would not be done, I feel I cannot be silent on this information contained within and must and will pursue the appropriate actions to report this information to the proper functions.”

So, did the Stated Clerk and Administrative Committee of the PCA in 1993-1994 help form PIF/CMI by what appears to be a cover up and whitewash of impropriety within IFBD?  Should Mr. Ottinger have been disciplined for the five reportable conditions that were documented by Mr. Mersereau? Why didn’t the IFBD audit committee report to civil authorities the offences of Mr. Ottinger that Mr. Mersereau found in 1991?

It is my understanding that the only discipline that Mr. Brooks and Mr. Ottinger received was a severe tongue lashing by the Stated Clerk along with the requisite tears and boohooing by Mr. Brooks, who then according to men who were at the 1994 GA, walked about with his proverbial tail between his legs.  It appears to this writer that the members of the 1994 GA were kept in the dark by the Stated Clerk about what had gone on at IFBD and therefore made a bad decision by dissolving IFBD and allowing Brooks and Ottinger to move their corruption to other companies which they formed, namely Presbyterian Investors Fund and Cornerstone Ministries Investments Inc.

Isn’t it time that the Legal Audit is revealed, or doesn’t the need for sunshine exist on Brown Road, Lawrenceville, Georgia ( the present PCA denominational offices)?   Mr. Porr said:

“there was a lack of moral fiber.”

Where are the Teaching Elders with courage or moral fiber that are willing to clean up the perceived cover up?  Where are the Concerned Presbyterians?  Are they a figment of ones imagination?  Where are the men that had their negative votes recorded at the 1985, 1986, 1993 and 1994 GA’s?  I don’t see any gold becoming dim; rather, I see the gold leaf peeling.

As Bob Williams said in his March 14, 2011 article in the Christian Observer, there is “unfinished business in the PCA.”


  1. Minutes of 13th GA 1985 page 114.
  2. Minutes of 14th GA 1986 page 171
  3. Minutes of 14th GA 1986 pages 172 & 173
  4. Minutes of 14th GA  1986 pages 261-273
  5. Minutes of 20th GA  1992 page 135
  6. Minutes of 21st GA  1993 page 181
  7. Minutes of 22nd GA  1994 page 256
  8. Minutes of 22nd GA  1994 page 269
  9. Minutes of 22nd GA  1994 page 270
  10. Minutes of 22nd GA  1994 page 189
  11. Minutes of 22nd GA  1994 page 191


Our Guest Editor Bob Wildrick is one of 3500 CMI investors still waiting to receive settlement proceeds from the February 2008 Chapter 11 bankruptcy of Cornerstone Ministries Investments, Inc., a.k.a. the “$140 million Ponzi scheme.”


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