Word of Faith leader named in fraud scheme
The leader of a secretive church in Rutherford County has been named in federal court records as someone who “promoted” an unemployment fraud scheme involving businesses owned by members of her congregation.
Jane Whaley, leader of the Word of Faith Fellowship, was named in a document filed Thursday in U.S. District Court in Asheville that describes a fraud conspiracy charge faced by one of her trusted advisers, Kent Covington.
In a 2017 investigation into claims of physical and emotional abuse at the church in Spindale, The Associated Press reported that authorities were looking into the unemployment claims of congregants and their businesses.
Whaley was named in a document that describes the fraud conspiracy charge faced by Covington, a church minister. His lawyer, Stephen Cash, said his client was expected to plead guilty in the case next week.
But, he added, Covington’s pleading is not an “admission that Jane Whaley instructed him to act or that Kent’s actions were designed to afford some benefit to Mrs. Whaley or Word of Faith Fellowship as an organization. This is not the case, and Kent would dispute any such assertion or characterization.”
Prosecutors say Covington and McKinny decided to lay off employees at one of Covington’s businesses so they could collect unemployment benefits in 2008 when the company was struggling financially. But the employees continued to work at the company, Diverse Corporate Technologies. They later put the scheme into place at Covington’s other business, Integrity Marble & Granite. Covington then implemented a variation of the scheme at Sky Catcher Communications Inc., a company he managed, prosecutors say.
“These conspirators promoted the scheme as a way for (the church) community businesses to weather the financial downturn,” the document said.
Cash said his client made “false statements” to the North Carolina Employment Security Commission, which oversees unemployment benefits.
“He accepts responsibility for his actions and continues to cooperate fully with the government,” Cash said.
“Ms. Whaley strongly denies any insinuation that she was somehow involved in Mr. Covington’s offense, as does Mr. Covington,” he said.
The scheme resulted in more than $250,000 in fraudulent claims between November 2008 and March 2013, according to court records. The conspiracy charge carries a maximum penalty of 30 years in prison and a $1 million fine.
Most employees were members of the Word of Faith Fellowship. Prosecutors had previously said Covington used his leadership position in the church to force them to comply.
Covington spent eight months in a North Carolina prison in 1974 for breaking and entering, as well as larceny, and later joined the church.
His wife, Brooke Covington, is one of Whaley’s most trusted confidants.
Two other ministers, Jerry Gross and his son, Jason Lee Gross, pleaded guilty on May 25 to wire fraud related to unemployment benefits at a podiatry clinic in Forest City, North Carolina.
Former members said Whaley promoted the scheme as “God’s plan” to help the businesses survive the economic downturn and keep money coming into the church.
In February 2017, the AP cited 43 former members who said congregants were regularly punched and choked in an effort to beat out devils. The AP also revealed how, over the course of two decades, followers were ordered by church leaders to lie to authorities investigating reports of abuse.
Those stories led to investigations in the U.S. and Brazil. In March, Brazilian labor prosecutors filed suit to close one of the churches and its school in Sao Paulo, saying its leaders “reduced people to a condition analogous to slavery.”
