BRIDGEPORT, Conn. -- A federal grand jury has indicted a former LDS bishop on charges he cheated investors including members of his congregation out of more than $400,000, prosecutors said Tuesday.
Julius Blackwelder of Utah, who was bishop of the Bridgeport ward of the Church of Jesus Christ of Latter-day Saints, is accused of using the money to pay back earlier investors in the pyramid scheme, build a waterfront home in Stratford and repay personal bank loans.
Blackwelder, 59, is expected to surrender to authorities ahead of an arraignment scheduled for Thursday in New Haven, said Thomas Carson, a spokesman for the U.S. attorney's office.
"This defendant is alleged to have abused his position of trust as a leader in his church to defraud fellow church members and others out of hundreds of thousands of dollars," said David Fein, Connecticut's top federal prosecutor.
Beginning in 2005, Blackwelder allegedly persuaded church members and others to invest their money in a pool known as the "Friend's Investment Group" by exaggerating his experience as an investor. He misled investors by saying he would invest their money in safe, long-term commodities futures contracts and, in some cases, guaranteeing a specific return on investment, according to prosecutors.
The indictment returned Monday by a grand jury in Bridgeport charges Blackwelder with nine counts of money laundering and mail and wire fraud. If convicted, he faces a maximum term of imprisonment of 20 years on each count of mail and wire fraud and 10 years on each count of money laundering.