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A former Christian pastor targeted his African-American parishioners with fake investments in âthe first black-owned alkaline water company.'
The United States Securities and Exchange Commission has charged a former pastor and his wife for stealing $500,000 through a trio of fraudulent businesses, including a cryptocurrency offering purportedly backed by a bottled water business.
According to a complaint filed on April 2, the pair also sold fake shares in their struggling water business, Teshuater, in addition to conjuring up a non-existent Bitcoin (BTC) mining outfit to dupe investors in Houston, Texas.
Former pastor offers 1,400% returns overnight
The complaint alleges that Larry and Shuwana Leonard âtargeted investors in the African-American community by promising oversized returns on various investments related to Teshuaâ, a business that bottled and distributed alkaline water.â
The SEC asserts that the former Christian pastor âcapitalized on his background as âa man of the clothâ to gain investorsâ trust,â and began defrauding investors during Spring 2017.
In the 45-year-old pairâs first scheme, âworthless âstock certificatesâ that did not actually convey ownership interest in Teshuaterâ were issued in exchange for roughly $291,000. Investors were promised âshort-term investment returns of up to 3,000 percentâ over just a few days.
The SEC states that Teshuater âearned little-to-no profit since its inception,â and was touted to investors as âthe first black-owned alkaline water company.â
Leonard launches TeshuaCoin offering
A further $170,400 was accumulated from the sale of TeshuaCoin, a cryptocurrency that the couple claimed was backed by the sales of the Teshuater company. The Leonards had targeted a $20 million raise through the cryptocurrency.
Larry claimed to divert investorsâ funds into a âhigh-yield, short-term Bitcoin-mining programâ that did not exist â generating a further $25,500.
The crypto scams were promoted through social media, with the pair conducting Facebook Live webcasts purportedly on the topic of âwealth generation for the African-American community.â
More than $500,000 stolen from parishioners
By December 2018, the scheme raised $500,000 from over 500 investors total, issuing âmaterially false and misleading statementsâ regarding how investorsâ funds would be used.
The stolen funds were commingled with Teshuater and other businesses operated by the Leonards, before being spent on a combination of personal expenses and other business activities.
None of the investment contracts issued by the pair or the Teshua company were registered with the SEC. The pair are not licensed to issue securities.
The SEC is seeking a permanent injunction, the disgorgement of all ill-gotten gains plus prejudgement interest, and civil penalties against the pastor and his wife.
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