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Wednesday, March 08, 2006                                                                                       View Comments

Pastor charged with falsifying loan documents

Despite being charged this week in U.S. District Court with falsifying paperwork to obtain $824,000 in loans to open a nondenominational church in Greensburg, PA, the Rev. Roy E. Smith, founder and pastor of the Church of Dominion, will be in the pulpit tonight.

"Oh yes, that's correct. The minute I was made aware of this, I made the board aware of what was happening, and they support me," Smith, 32, said Tuesday.

"I had a lapse in judgment and I'm attempting to rectify it," said Smith, who declined further comment.

According to documents made public this week in federal court in Pittsburgh, Smith is accused of one count of bank fraud last year for falsifying paperwork at five area banks to obtain more than $824,000 in loans.

Court records said Smith, who used to operate the now-closed Bread of Life Church of Dominion along Fifth Avenue in McKeesport, Allegheny County, opened the nonprofit Church of Dominion Inc. in Greensburg in February 2005.

Smith, who is from Columbus, Ohio, originally registered Church of Dominion Inc. as a nonprofit religious organization in 2000, according to federal documents.

The Church of Dominion Inc., which lists Smith as president and its only officer, purchased the former parish of the Laurel Highlands Church of God, at West Pittsburgh Street and Westminster Avenue, for $455,000, according to Westmoreland County real estate records.

Despite the ongoing criminal proceedings, Smith's congregation of about 75 members remains strongly supportive, according to two board members.

"In the process of our church making various loan applications within the past year for our mortgage, Christian school, day-care center, food bank and outreach programs, we regret that inaccurate information was submitted, causing our pastor and the church to commit fraud," said church vice president and associate pastor Brian M. Christian.

"Nevertheless, all loan applications and all proceeds were approved by the board of directors of the church, and every dollar is accounted for. We are fully aware of all matters pertaining to the specifics of this situation and have been aware for some time," Christian said.

Another board member, who declined to give his name, said the church's five-member board and church congregation have been aware of the federal investigation since July.

"We're standing behind Rev. Smith 100 percent on this. This is not a situation where someone ran off with all the money. ... We can account for every single dime going into the church," said another board member, who also declined to be identified.

"Rev. Smith is taking full responsibility for it, although the church board approved those loans, too," he added.

According to the federal complaint, Smith used fraudulent documents to obtain $364,000 from Citizens Bank, $150,000 from Dollar Bank, $150,000 from First Commonwealth Bank, $60,000 from Commercial Bank & Trust, and $100,000 from S&T Bank.

The complaint states Smith falsely represented Church of Dominion's income, falsified its rent payment history and the name of its landlord at its former McKeesport location, and falsified the indebtedness of the church when it secured the loans last year.

Smith also allegedly presented the financial institutions "a false award notification letter to the Church of Dominion represented to be from The Richland Foundation in Harrisburg" for $150,000.

According to the Pennsylvania Department of State's bureau of charitable foundations, the Richland Foundation in Harrisburg does not exist.

"It was further a part of the scheme ... that Roy E. Smith provided the same loan collateral to more than one of the financial institutions without notifying the involved financial institutions that the collateral had been previously pledged," the complaint states.

The board members blamed the fraudulent loan paperwork on advice given to Smith by an outside financial consultant whom they declined to identify, and who they claim fled the area. They said the church's finance committee chairman, whom they also declined to identify, was asked to resign Jan. 31.

Margaret Philbin, spokeswoman for U.S. Attorney Mary Beth Buchanan's office in Pittsburgh, declined to comment on the church board's claim that Smith received poor financial advice from another, anonymous party.

"Obviously, the complaint is a matter of public record and speaks for itself," she said.

The church leaders noted that in addition to purchasing the building, they hired a teaching staff of seven for its kindergarten through 12th-grade Christian school program, paid five employees to run the church's state-licensed day-care center, renovated the kitchen, and replaced the boiler system for another $25,000.

"We've already repaid 50 percent of the loans," Christian said.

Christian said Smith will take a short leave of absence beginning April 17 as a result of the complaint. However, he anticipates that Smith will return.

"Although Pastor Roy is part victim in all of this, he has decided to take a short leave of absence beginning April 17. The officers, members and pastoral staff completely support Pastor Roy in this matter, as our church was the sole beneficiary of all loan proceeds obtained," Christian said.

"Our church will continue to go forward in all ministry endeavors planned for this region and pray our senior pastor (Smith) will continue to go forward in all ministry endeavors planned for this region and pray our senior pastor will continue to lead us as we teach forgiveness, love and the grace of God that helps us all overcome all mistakes and failures," Christian said.

Christian said the church plans to "continue to make full restitution" in this matter.

Although board members noted that the church pays the rent on Smith's home and his automobile lease payments, none of those funds come from the loans in question. They said the monthly rental and lease payments come from other regular donations made by the congregation.

Smith waived arraignment, according to court documents.

Assistant U.S. Attorney Dennis Kissane is expected to prosecute the case.

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