Questions grow about pastor's $16M in debts

By Paul Brinkmann
Orlando Sentinel
March 25, 2016

Orlando Baptist Church

Questions are growing about $16 million in debt racked up by Orlando Baptist Church's former pastor, David Janney, who resigned in February amid a sex scandal.

A former member of the church, Arlene Miranda, filed suit Dec. 10 accusing the church of forcing her to shut up about her sexual encounter with Janney, who is married.

Three days after Miranda's lawsuit, Janney filed for personal bankruptcy in federal court. Most of the debts date to 2007 or 2008, and they include some large foreclosures filed by banks.

New lawsuits are being filed against Janney this week. On March 22, a financial company filed a claim in the bankruptcy seeking to deny Janney his chance at washing his hands of at least $3.6 million. Miranda also filed a second lawsuit, this time aimed at church officers, alleging that they tried to cover up her alleged affair.

"When I saw how much money he owes, I thought, 'How can a pastor of a church have that much debt?'" said Miranda's attorney, Mayanne Downs. "And also, where did it all go? There appears to be a pattern of irregular financial activity, coupled with the sexual abuse that we've alleged."

Janney's attorney, Peter Hill of Miami, said the debts are related to failed investments during the Great Recession. Hill said the timing of Janney's bankruptcy filing, days after the Miranda lawsuit was filed, was coincidence.

"Janney did everything in his power to try to avoid bankruptcy," Hill said. "As the bottom fell out of the economy during the Great Recession, the builders pulled out of the developments."

For example, Janney's bankruptcy statements say he owes $6.1 million to the Lake Jackson Ridge Homeowners Association in Lake County. Hill said that development stalled during the recession. Hill said Janney was involved in land development for national builders during a time when he was not pastoring a church.

The church "disputes the vast majority of the allegations" Miranda has made, lawyers for Orlando Baptist wrote. The said they weren't attempting to silence her but were actually trying to provide confidential support and counseling.

However, Orlando developer Beat Kahli, CEO of Avalon Park Group, said he loaned Janney $20,000 in 2007, precisely because he knew Janney was a pastor.

"He said he was doing a project somewhere in southeast Orange County and needed a little more," Kahli said. "It was just because he was a pastor, and he said he was short of some money. I didn't consider it a business deal; it was more like a personal loan."

Kahli said they haven't talked in years. Janney listed the debt on his bankruptcy statements.

Kahli was also surprised at Janney's debt totals.

"Sixteen million, that's a lot," Kahli said. "That's more like a developer than a church pastor."

Attempts to reach church personnel were not successful. The church secretary didn't respond to an email that listed questions about Janney's debt.

One of Janney's debts is for a company called Villa City Development I and III. The address for that company is listed as 500 S. Semoran Blvd., which is the same address as Orlando Baptist Church.

Villa City is the name of an old community in Lake County, about 35 miles west of Orlando, where plans for a massive new development called Villa City are shaping up, eventually to include 5,600 homes.

But a representative of that Villa City company, with the Broad & Cassel law firm, said she was not aware of any connection between it and Janney, or between its investors and Janney.

According to Downs, Orlando Baptist and its leadership have moved several times and are currently looking for a new location.

Businessman Craig Mateer, also listed on Janney's bankruptcy, donated money to Janney's charities and sued Janney in 2013 for $117,000. The suit alleged that Janney used donations for personal expenses. Mateer assigned an accountant to find out what happened to the money, which was supposed to be used for new chicken farms to feed people in Kenya.

Mateer dropped that lawsuit that year; Janney paid the $117,000 back after the Sentinel published a story about it.

On Friday, Mateer said he is appalled at the new allegations about Janney and the church.

"I think because he was a pastor, I eased up and took my foot off his throat," Mateer said. "Wish I wouldn't have done that now."

Before Mateer dropped the suit, Janney claimed in a response in court that Mateer's money had been transferred to personal accounts because of a bookkeeping error.

One of the larger claims in the bankruptcy case is $3.6 million originally loaned to Janney by an Atlanta area bank, FirstCity Bank, that failed in 2012. That bank was run by president Mark Conner, who is serving a 12-year prison sentence for "a multi-million-dollar conspiracy to defraud the bank," according to the FBI.

In a written affidavit filed with the court, Janney claimed that he was also manipulated by Conner.

"Conner contacted me after FirstCity had completed the foreclosure process and informed me that I could 'get back in the deal' provided that I sign one or more loan modifications and ratify the sale" that was orchestrated by Conner.

In the current bankruptcy case, Janney is also facing allegations from the court-appointed Chapter 7 trustee, who alleges that Janney transferred $50,000 from Morgan Stanley bank accounts into life insurance and retirement accounts — which are shielded from claims in bankruptcy court.

The trustee alleges that the transfers were made in October "with the intention to hinder, delay and defraud creditors."

In response, Janney's attorney filed a motion blaming Morgan Stanley for the problem.

"The fault for the fact that the funds were not invested in exempt retirement accounts is Morgan Stanley's and not the Debtor's, belying any intent to hinder, delay or defraud creditors," Hill stated in the response.



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