O.C. Church Founder and Friend Convicted of Fraud in Donations
The founder of a Costa Mesa church and a childhood friend have been convicted of defrauding donors of as much as $9 million since 1993, ostensibly for such charitable causes as AIDS research, homeless shelters, veterans’ aid and children’s services.
Gabriel Bernardo Sanchez, 36, and Timothy James Lyons, 35, are scheduled for sentencing Feb. 9 after having been found guilty this week in federal court in Santa Ana on several counts of mail fraud and money laundering.
“This demonstrates that if you’re going to operate fraudulently, you can’t hide behind the protections afforded to legitimate charitable enterprises,” said Assistant U.S. Atty. Ellyn Lindsay, who prosecuted the case. “It demonstrates to donors that they shouldn’t give spontaneously to someone who cold-calls them on the phone. Take the person’s information and check it out, [because] you don’t want your charitable dollars wasted on greedy, for-profit racketeers.”
Lyons’ attorney, David Conn, declined to comment on the case. William Kennon, a lawyer representing Sanchez, did not return a telephone call seeking comment.
According to a 22-page indictment against the pair, Sanchez founded the First Church of Life in 1993 as an umbrella organization under which he operated several supposedly charitable groups, including the American Veterans Help Fund, Americans Against Drugs, Children’s Assistance Foundation and AIDS Research Assn. At the same time, the indictment asserts, Lyons operated a company called North American Acquisitions, which contracted to raise funds for those groups through a battery of telemarketers who cold-called potential donors and, in some cases, sent couriers out to collect their contributions.
According to the indictment, about 80% of donations went to pay the telemarketers’ commissions while most of the rest was used to cover the personal expenses of Sanchez, Lyons and a few cohorts. “Virtually none of the funds ... was spent for charitable purposes,” the indictment says.
Two other men indicted in the case -- Roger Nolan Lane and Steven Lawrence Delatorre -- pleaded guilty last month and are due to be sentenced in January.
Sanchez and Lyons could face long prison terms, Lindsay said.