If you'll believe this, I've got a bridge I'd like to talk to you about...
Religion, we’re often told, will make you a more moral person and people who aren’t religious have no morality. Yet if you pay attention you can find example after example where the above simply isn’t true. Take, for instance, 84-year-old Stephen Klos who was considered an upstanding and moral person by the fellow members of his church. So much so that when he started offering to invest money on behalf of various members several of them handed over huge amounts with no questions:
Klos was charming and talked about his real estate that was worth millions. Invitations to friends and churchgoers to invest — sometimes with promises of returns of 24 percent a year — were met with open checkbooks.
But King County prosecutors Wednesday painted a different picture of Klos, who was charged with 28 counts of securities fraud in a scheme involving the alleged theft of $3.5 million from dozens of churchgoers and others, including more than $3 million from six elderly women in the church.
Prosecutors say Klos and another man, Robert Justice, 52, paid later investors in the scheme with money from new clients, pocketing hundreds of thousands of dollars along the way. Justice is named in five felony counts.
Ponzi schemes always fall apart because they rely on the constant addition of new
suckers investors to keep the illusion going and in any given church there’s only going to be so many people who have money to invest. Note I didn’t say that they could afford to invest, just that they had money to invest.
Naturally, the pastor and congregation are shocked, SHOCKED, that such a good man could be capable of such a crime:
Asimakoupoulos said relatives of many widows told him about their loved ones handing money over to Klos, who in turn assured the pastor that his financial plan “was aboveboard.”
One family lost $600,0000, money inherited from a loved one, the pastor said.
“He gained access to family funds and was promising returns that were too good to be true,” Asimakoupoulos said, adding he was stunned that “someone as well-versed in the Bible as he was could have this side to him.”
Because we all know that if you’re well-versed in the Bible you’re automagically a more moral person than someone who isn’t. (By which standard there are a lot of atheists who should be stunningly moral despite not believing in Gods.)
This is an all-too common scenario in part because religion tends to promote magical thinking and derides skepticism. When you accept that a man 2,000 years ago was born from a virgin, walked on water, turned water into wine, and died and rose from the grave in three days, well, believing you can get a 24% return on investment in a year isn’t that far-fetched. And if you can’t have faith in your fellow congregation members then who can you have faith in? Combine that with a natural human tendency for greed (e.g. did the six elderly women who invested $3 million really need more money?) and you have a money tree ripe for the picking.
Worse, once you’ve invested that kind of faith into something (or, in this case, someone) often it can be hard to accept the reality of the situation:
The charges say Klos is “romantically involved” with one 85-year-old suspected victim who has given him more than $350,000. She continues to turn over her Social Security, despite warnings from investigators and family, according to the charges.
You know what they say about fools and money.
The truly amazing thing is that this isn’t the first time Klos has been in trouble for running a Ponzi scheme:
Klos was barred from securities and financial dealings in 1992 for running another Ponzi scheme that raised more than $3.4 million, according to Securities and Exchange Commission (SEC) records. No criminal charges were filed in the case, which involved two other men, although SEC records indicate he had to pay back more than $380,000.
No criminal charges and he only had to pay back $380,000 out of the $3.4 million he stole? Is it any surprise he’d try it again? Hell, is it any surprise these people fell for it?