Bakker Charged With Bilking PTL Followers : Indictment Accuses Evangelist, Aide of Fraud in Selling ‘Partnerships’ for Vacations at Hotel

Jim Bakker, the embattled television evangelist who resigned last year as president of the PTL ministry amid a sex-and-hush-money scandal, was indicted Monday along with a former top associate on federal charges of fraud and conspiracy in the sale of “lifetime partnerships” for yearly vacations at a PTL theme park and resort.

The 24-count indictment, returned by a federal grand jury here after a 16-month investigation, charged that Bakker, 48, and former PTL Executive Vice President Richard Dortch, 57, fraudulently sold nearly 153,000 fully paid partnerships for a total of at least $158 million to help maintain their “lavish and extravagant life styles.”

Two Others Charged

At the same time, the grand jury returned an 11-count indictment against David Taggart, former PTL vice president and special assistant to Bakker, and his brother, James Taggart, former PTL interior designer. The Taggarts were charged with diverting more than $1.1 million in PTL funds to their personal use and evading federal taxes totaling about $494,441.

Bakker, who once termed the grand jury investigation a “fishing expedition” and predicted that he would not be indicted, has denied any wrongdoing in PTL’s financial management. He and the others accused in the indictment could not be reached for comment Monday.

Bakker’s wife, Tammy Faye, was not named as a defendant in the indictment, although the document alleged that she and Bakker received bonuses totaling almost $3.5 million for their personal use despite Bakker’s knowledge that PTL was in poor financial shape and experiencing severe cash-flow problems.

The bonuses were awarded to the Bakkers by the PTL board of directors from 1984 to 1987 and were in addition to other compensation the Bakkers received, the indictment alleged.

It alleged also that Dortch directed the payment of $265,000 in February, 1985, to Jessica Hahn to keep the former church secretary from publicly disclosing her affair with Bakker.

According to the indictment, Dortch asked former PTL contractor Roe Messner of Wichita, Kan., to secretly bill PTL for the payment to Hahn by adding that amount to construction costs of an amphitheater.

Bakker, Dortch and the Taggart brothers each face a maximum penalty on conviction of $250,000 in fines and five years’ imprisonment for each count of fraud, conspiracy and tax evasion. The defendants were ordered to appear for court proceedings on Dec. 15.

Bakker resigned as PTL’s president in March, 1987, amid the scandal over the payment of money to Hahn, with whom he had a sexual encounter at a hotel in 1980.

Since then, the PTL ministry that Bakker founded has gone into bankruptcy, and he and his wife have been ordered by U.S. Bankruptcy Judge Rufus Reynolds to repay $6.6 million to PTL.

PTL stands for “Praise the Lord” and “People That Love.”

New Church at Rink

Late last month, Bakker opened a new church, called the New Covenant Church, in temporary quarters in a skating rink in Charlotte. One of his first appeals was for a “miracle” gift of $200,000 from his supporters.

The indictment against Bakker and Dortch charged them with mail and wire fraud and conspiring to defraud the public through the sale of lifetime partnerships promising yearly vacations at Heritage Village USA, a PTL resort development in Ft. Mill, S.C., just south of Charlotte.

In November, 1983, the indictment said, Bakker announced plans to fund construction of a 500-room hotel by selling lifetime partnerships, with half the rooms devoted to the exclusive use of paid partners and the other half reserved for paying guests to provide operating revenues.

The next January, Bakker publicly announced the sale of the partnerships, informing prospective buyers that for $1,000 each they would receive free lodging at the new hotel for four days and three nights each year for life, the indictment alleged. The hotel was to be called the Grand Hotel.

Moreover, Bakker allegedly said also that only 25,000 partnerships would be sold.

Bakker and Dortch proceeded with the first mail solicitation for partnerships in the hotel despite advice from PTL’s legal counsel that they should wait until a full in-house investigation of potential legal problems could be completed, it was alleged.

The indictment alleged also that Bakker and Dortch continued to promote the lifetime partnership plan even after they learned that the program had exceeded the announced 25,000 limit.

This was the first in what the indictment alleged was a total of 11 different partnership programs offered at various times between 1984 and 1987, eight of which promised lodging in Heritage Park facilities. In all, the indictment said, 152,903 fully paid lodging partnerships were sold for a total of $158 million in revenues for PTL.

The indictment charged Bakker and Dortch with making false statements to induce the public to purchase the partnerships and with diverting the money for their personal benefit.

In the televised solicitations, the indictment said, Bakker and Dortch promised that revenue from the partnerships would be used to construct the Grand Hotel, Tower Hotel, Country Farm Inn, Heritage Grand Mansion, 1100 Club Campground and several bunkhouses.

“But, by the time of Bakker’s resignation from PTL in March, 1987, only the Grand Hotel and one bunkhouse had been completed,” it said.

The bunkhouse had only eight rooms set aside for use by lifetime partners, even though Bakker and Dortch had knowingly sold about 12,275 fully paid partnerships for the bunkhouse and the 1100 Club Campground.

Besides the nearly $3.5 million paid in bonuses to the Bakkers, the indictment charged, a total of about $550,000 in bonuses was paid to Dortch between 1984 and 1987.

“Bakker and Dortch obtained these bonuses with the full knowledge that PTL was in poor financial condition; that the organization was experiencing severe cash-flow problems; and that insufficient lifetime partnership funds had been designated and segregated from operating funds to ensure the completion of various lodging facilities promised to partners by Bakker and Dortch,” the indictment claimed.

Bakker and Dortch were also charged with knowingly misrepresenting PTL’s financial problems to its board of directors.

In the indictment against the Taggart brothers, David, 31, and James, 34, were charged with evading taxes amounting to, respectively, $319,805 and $174,636.

The Rev. Jerry Falwell, the fundamentalist TV preacher who took over PTL’s reins for several months before resigning, has decided to make no comment, said a spokesman, Mark DeMoss. “He is saying nothing other than to repeat that he had hoped there would be no indictments,” DeMoss said.

But Jeffrey Hadden, a sociologist at the University of Virginia who has analyzed and written widely about prime-time television preachers and their methods, exclaimed: “Thank God, at last!”

“What became personally annoying to me was the debate Jim Bakker carried on in public as if nothing were happening,” Hadden said. “As if there had been a flash from heaven that had forgiven him and was going to wipe out all those documents from the grand jury’s attention and consciousness.”

Joe E. Barnhart, author of “Jim and Tammy,” a book published this year, said he thought Bakker and Dortch “got in over their heads” with projects and fund-raising at PTL. “But ignorance is no excuse,” said Barnhart, a philosophy professor at the University of North Texas in Denton.

Barnhart said that decades ago, when newspapers first raised questions about the use of funds by evangelist Billy Graham’s ministry, Graham “turned for help to people who knew business.” When Bakker’s fund-raising was challenged by the Charlotte Observer, Bakker accused the newspaper of persecution, Barnhart said. “It is not enough to quote the Holy Spirit on this and that, and think that covers it.”

Times religion writers Russell Chandler and John Dart contributed to this story from Los Angeles.