Church Court: Armstrong Guilty, by Ed Sealover, Gazette, August 8, 2007

Church Court: Armstrong Guilty
Panel Says He Took Nearly $400,000

By Ed Sealover
Gazette
August 8, 2007

http://www.gazette.com/articles/armstrong_25813___article.html/court_church.html

Denver - An ecclesiastical court on Wednesday convicted the Rev. Donald Armstrong of stealing nearly $400,000 from his Colorado Springs parish, though it cannot legally punish the breakaway pastor.

The court of the Episcopal Diocese of Colorado will decide in about a month, however, whether to recommend that Bishop Robert O'Neill defrock Armstrong, a largely symbolic action that would end all ties between the church and him.

Armstrong left the diocese with a majority of the Grace Church & St. Stephen's vestry board in March and now oversees the congregation of the Grace CANA Church that is affiliated with the more conservative Convocation of Anglicans in North America. His spokesman, Alan Crippen, said the Episcopal Diocese does not have authority over Armstrong.

"Our relationship with the diocese has been one of adversity over the last couple of months, so this decision is no surprise," Crippen said Wednesday.

Rev. Donald Armstrong

A forensic auditor for the diocese presented evidence in a July 31 trial that Armstrong diverted money from a church trust for single Episcopal ministry students to pay for the college education of his son and daughter.

He also used parish money for phone bills, car repairs and parking tickets, testified the auditor, Sheri Betzer.

Armstrong did not cooperate with the investigation or attend the trial.

The five-member court, made up of clergy and lay church members, found him guilty of all six counts against him. Those counts charged that he:

- Stole $392,410 from the church and underreported his income to the Internal Revenue Service by $548,097;

- Received illegal loans totaling $122,479;

- Caused the church to be encumbered with deeds of trust totaling $4.5 million without the approval of the bishop or the Standing Committee of the Diocese;

- Violated a temporary suspension of his duties by communicating with parish leaders;

- Improperly used church discretionary funds meant for the poor;

- And failed to maintain proper accounting books.

Both sides in the case now have 30 days to respond to the judgment before the court recommends a sentence. Bishop O'Neill can reduce the recommended sentence but cannot make it any more stringent.

While Armstrong faces losing his ordination in the Episcopal Church — he is now a priest in good standing in the CANA church, Crippen said — the court cannot force him to repay any of the money.

While Church attorney Hal Haddon said he thinks the IRS is looking into this as a criminal matter, no charges have been filed and an IRS spokeswoman would not comment.

Nor will the ruling settle the issue over whether the diocese or the breakaway congregation that continues to meet in Grace Church owns the historic downtown building. That matter is in litigation.

A statement from the diocese said the church canons of which Armstrong was convicted of violating "exist to guard the well-being of members of the church, and, when there is wrongdoing, to help restore the spiritual and institutional health of the church."

Crippen added that the vestry board of Grace CANA is conducting its own forensic audit of the parish accounting books and expects to have its findings ready by next month.