Ex-church leaders charged with $14M fraud

OAKLAND, Calif. – A former bishop and lay leader of a historically African American church have been charged with defrauding California congregations by mortgaging their properties in order to obtain $14 million in loans they used for personal expenses, authorities said Tuesday.

A federal indictment unsealed Tuesday accuses Staccato Powell, 62, of Wake Forest, North Carolina, and Sheila Quintana, 67, of Vallejo, California, of conspiracy and wire fraud, with Powell also charged with mail fraud, the U.S. attorney’s office for the Northern District of California said in a statement.

Powell was elected in 2016 as a bishop in the African Methodist Episcopal Zion Church, which traces its history to 1796 and has about 1.4 million members, authorities said. He headed western U.S. congregations but was disrobed in a church trial last year after officials concluded he had mishandled funds.

The indictment said Powell and Quintana set up Western Episcopal District Inc., and used the entity to illegally obtain grant deeds to properties owned by congregations in Oakland, San Jose, Palo Alto and Los Angeles.

The congregations had little or no mortgage debt until the pair, without permission, used their real estate as collateral to obtain more than $14 million in high-interest loans, prosecutors said.

Some congregations that had paid off mortgages years earlier ended up saddled with debt, prosecutors said.

Powell and Quintana then diverted money for their personal benefit, including retiring a mortgage on Powell’s North Carolina home, buying real estate there, and making cash payments to Quintana’s spouse, prosecutors said.

Western Episcopal District Inc. filed for Chapter 11 bankruptcy in 2020 and listed among its assets 11 churches in California, Arizona and Colorado, authorities said.