You raised money from your congregation. Or your community group. Maybe your ethnic association, the people who came to America from the same country, who attend the same cultural events, who trust each other because nobody else understands what they've been through. They believed in the investment because they believed in you. The returns you promised seemed reasonable. The business plan made sense. And now federal agents are asking questions.
Federal prosecutors call this affinity fraud. And they treat it as one of the most morally reprehensible crimes on their docket.
Here's what makes this different from regular securities fraud or wire fraud: prosecutors seek enhanced sentences specifically because you targeted people who trusted you. When you exploit a religious congregation, when you take money from elderly members of your church, when you use your position as pastor or community leader to promote investments - you're facing sentencing enhancements that can add a decade or more to your prison exposure. The FBI and SEC classify affinity fraud as especially egregious. Federal judges agree with them.
Welcome to Spodek Law Group. We handle federal criminal defense in affinity fraud cases - investment schemes involving religious communities, ethnic groups, cultural organizations, and other trust-based networks. If you're under investigation, if the SEC has contacted you, if federal agents have shown up asking questions about money you raised from your congregation or community - this article explains what you're actually facing.
What Makes Affinity Fraud Different
Affinity fraud exploits the trust that exists within specific groups - religious congregations, immigrant communities, professional associations, cultural organizations. The fraudster is typically a member of the group, sometimes a leader, using shared identity to overcome normal skepticism about investment opportunities.
The federal government doesn't treat this like regular fraud. Its worse. Much worse.
According to the International Bulletin of Mission Research, Christian religious leaders alone are estimated to embezzle $86 billion in 2024. Thats not a typo. Eighty-six billion dollars. The Gordon-Conwell Theological Seminary's Center for the Study of Global Christianity estimates this category of crime is growing at 5.77% annually. Federal agencies have prioritized religious and community fraud prosecution specifically because the problem is so massive - and because churches traditionally don't report to police. About 95% of church fraud goes undetected or unreported according to researchers.
The DOJ doesn't wait for reports. In September 2025, federal prosecutors unsealed "Operation False Profit" - a 26-count indictment against eight members of the House of Prayer Christian Churches of America. The investigation involved FBI, IRS Criminal Investigation, Veterans Affairs OIG, and multiple other agencies working together. William Gallagher, a Texas financial advisor who targeted elderly Christian investors with a $32 million Ponzi scheme, received three life sentences. Kent Whitney, pastor of the Church of the Healthy Self in Orange County, got 14 years for a $33 million church-based investment scam. Greater Ministries International in Tampa bilked 18,000 people out of $500 million - church leaders received sentences ranging from 13 to 27 years.
Nearly 70% of victimized churches choose not to report fraud to police. But heres the paradox - federal investigators find you anyway. Whistleblower tips to the SEC. IRS-CI tracing financial irregularities. FBI following money flows across accounts. Your congregation may never report you. The federal government still builds a case.
The Enhancement Stack That Destroys Your Guidelines
Under the federal sentencing guidelines, your sentence starts with a base offense level. For fraud, thats level 7. But then the enhancements begin - and in affinity fraud cases, they pile up fast.
The Federal Sentencing Guidelines add levels based on multiple factors. Heres how the stack works in a typical affinity fraud case:
- Loss amount: If the amount exceeds $550 million, add 30 levels. Over $65 million, add 26 levels. Over $25 million, add 24 levels. The losses in major affinity fraud cases regulary exceed tens of millions.
- Vulnerable victims (10+): +2 levels. Elderly congregation members, immigrants who don't speak English fluently, people who trusted you because of your religious role - they all qualify.
- Large number of vulnerable victims: +4 levels. A congregation of 500 where 200 invested? That qualifies.
- Number of victims (250+): +6 levels. Megachurches and large community organizations often hit this threshold.
- Abuse of position of trust: +2 levels. If your role as pastor, elder, community leader, or advisor created the trust they exploited, you get this enhancement.
- Sophisticated means: +2 levels. Creating business plans, financial projections, formal investment documents - evidence of sophistication.
- Mass marketing: +4 levels. Church announcements, community newsletters, solicitations at religious services - prosecutors argue these constitute mass marketing.
Stack enough enhancements and your guideline range approaches or exceeds the statutory maximum. Wire fraud carries 20 years per count (30 years if a financial institution is involved). Securities fraud carries 25 years per count. And prosecutors charge multiple counts - one for each wire transfer, each email, each communication.
The charge stacking in affinity fraud is brutal. Wire Fraud (18 U.S.C. 1343) plus Securities Fraud (18 U.S.C. 1348) plus Mail Fraud (18 U.S.C. 1341) plus Money Laundering (18 U.S.C. 1956). Francier Obando Pinillo, a pastor in Washington state who ran a cryptocurrency scheme through his church, faces 26 separate counts of fraud - each carrying up to 20 years.
Heres the inversion most defendants dont expect: your position as pastor or community leader becomes prosecution evidence, not a defense. The fact that congregation members trusted you BECAUSE of your role proves you knew how to exploit that trust. The sermons you preached, the spiritual authority you held, the relationship you built - these become prosecution exhibits demonstrating you understood exactly what you were doing.
The 99% Problem
The conviction rate for federal securities fraud cases is aproximately 99%. According to the U.S. Sentencing Commission, of 178 securities fraud defendants sentenced in fiscal year 2024, almost none prevailed at trial. These are the statistics.
The average sentence was 38 months. But that number is misleading for affinity fraud cases. Cases with vulnerable victim enhancements, abuse of trust enhancements, and large numbers of victims routinely hit 10-15 years. Some defendants receive effective life sentences.
There's a connection most people don't understand: the SEC investigation IS the DOJ investigation. SEC staff regulary share information with DOJ prosecutors. The same documents, the same witness interviews, the same financial analysis. By the time you know the SEC is looking at your investment activities, the criminal case is already being built. This isn't speculation - in multiple recent pastor fraud cases, SEC brought civil charges while DOJ brought criminal charges simultaneously.
About 60% of securities fraud defendants receive sentences below the federal guidelines - mostly through prosecutorial cooperation motions. But affinity fraudsters rarley get these deals. When you betrayed your congregation, when you took retirement savings from elderly church members, when you exploited immigrants who trusted you because you spoke there language and shared there culture - prosecutors want headlines. They want deterrence. They want other pastors and community leaders to see what happens.
The "good faith" defense - that you genuinely believed the investment would succeed - rarely works in affinity fraud cases. Prosecutors counter that your position of trust is evidence you knew how to manipulate people. You understood there faith. You used it.
What To Do When Faith Becomes a Federal Case
The single most important reality: winning at trial is statisticly almost impossible. But that doesn't mean defense is hopeless. It means the fight happens in different places.
Where defense actually matters in affinity fraud cases:
- Challenging the loss calculation. Every dollar affects your offense level. If some investors were repaid, if some funds went to legitimate business expenses, if the "loss" calculation includes inflated figures - challenging these numbers can reduce your sentence by years.
- Contesting vulnerable victim enhancement applicability. Not every investor qualifies as "vulnerable." Sophisticated investors, institutional money, people who did there own due diligence - challenging who counts as vulnerable can eliminate 2-4 levels from your guidelines.
- Negotiating during the pre-indictment window. Once federal charges are filed, leverage disappears. But during the investigation phase - when SEC is building its case, when DOJ is deciding whether to indict - there are options. Civil resolution. Cooperation agreements. Pre-charge negotiations that can affect what charges get filed.
- Building the mitigation narrative. If conviction is likely, the sentencing hearing becomes everything. Character witnesses. Mental health evidence. Evidence of genuine belief in the investment. Restitution efforts. Family circumstances. The difference between 8 years and 15 years often comes down to the sentencing memo.
The critical window is between SEC investigation and DOJ indictment. Once criminal charges are filed, everything changes. Acting during the investigation phase - understanding what agencies are involved, what evidence they have, what enhancements they're building toward - this is where real defense happens.
Todd Spodek has handled federal fraud cases involving religious and community organizations. He understands how enhancement arguments work, where prosecutors overreach, and what defense strategies actually matter when the conviction rate is 99% but the sentence range spans decades.
When Your Facing This
If you're facing an SEC investigation, a federal grand jury subpoena, or agents asking questions about your church or community investments, Spodek Law Group provides honest assessment of were you stand and what options exist.
The consultation is free. Theirs no obligation.
What you'll get is a realistic picture: What stage is the investigation? What enhancements likely apply? Is there still a window for pre-charge resolution? What are actual sentencing ranges based on the facts of your case - not best-case fantasies, but realistic outcomes based on how these cases resolve in federal court?
Call us at 212-300-5196. The window between investigation and indictment is when options exist. Once charges are filed, leverage disappears. Once enhancements are locked in, sentence ranges are set. Earlier intervention means more possibilities.
Dont wait for the indictment.
