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In the Name of the Father and the Son and the Wholly Owned Subsidiary

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In that same lawsuit, some retirees also claim they sank their life savings into the retirement center because ministers falsely assured them that a nursing home would be built on the property to accommodate them as their health failed.

The nursing home has not been built.
Several widows, like Ranalli, claim they have no means other than their equity in the retirement center--equity they had been told at the time of their purchase would be easily recoverable. They claim that because the units aren't selling and have decreased in value, they cannot recover their life savings.

The seniors also accuse the Conservative Baptist and Southern Baptist companies of rigging a 1995 sale of the retirement center. The plaintiffs allege the center was sold by the Conservative Baptist companies to the Southern Baptist companies at a fraction of its value to rescue the responsible Conservative Baptists from being personally sued or scrutinized by the Arizona Corporation Commission.

The Southern Baptist organizations named in the lawsuits include the umbrella foundation, Baptist Foundation of Arizona, and two subsidiaries--Foundation Housing Corporation and Arizona Baptist Retirement Center Inc.

The Conservative Baptist organizations being sued include the umbrella Arizona Baptist Convention (also known as the Southwest Conservative Baptist Convention) and subsidiaries Arizona Baptist Retirement Services Inc. and Conservative Baptist Retirement Community Inc.

All the named companies--and the ministers who serve as officers and directors of the companies--deny wrongdoing in court papers.

The Southern Baptists contend they are "good Samaritans" who had the "financial wherewithal" to rescue the retirement center as it was floundering, says John DeWulf, an attorney for the Southern Baptist companies. DeWulf says the units have not decreased in value, and suggests the plaintiffs have been misinformed about the marketability of their investments.

DeWulf says it's "ridiculous" that the plaintiffs have accused the Baptist groups of rigging the sale of the retirement center to shield themselves from liability.

"We shouldn't even be in the lawsuit," he says.
Neither the Conservative Baptist ministers nor representatives of the companies being sued would comment for this article, on the advice of their lawyers. But their position is clear in public records: They view themselves as ethical ministers and volunteers who had nothing to gain financially from the retirement center. They claim they were honestly motivated to create a "ministry" and provide a good lifestyle for elderly Christians. But their dream was smashed by a real estate crash, which prevented them from selling residential units and caused them to default on $2.5 million worth of bonds. They claim they never promised a nursing home.

However, public records and the elderly residents tell a different story.

Eleven years ago, retirees Edna and Jesse Gilmore read an advertisement for Paradise Valley Estates in a newspaper. The Gilmores themselves are Christians, and they were impressed that a retirement center was being built by Baptists.

Jesse says he and Edna agreed that "Baptists are good people."
During a tour of the retirement center, the Gilmores met the Reverend Robert Lindstrom, executive director of Arizona Baptist Retirement Services, which had been incorporated in 1983 to build and operate the facility.

"We were very much impressed that a minister was running the thing," Jesse Gilmore recalls.

Lindstrom did not tell Jesse that Arizona Baptist Retirement Services had filed papers at the Arizona Corporation Commission indicating it was insolvent.

And later, when the Reverend Edward Mitchell took over Lindstrom's job, Jesse had no idea that the company's debt was mushrooming.

Instead, in mass mailings and sales pitches, ministers and others affiliated with Arizona Baptist Retirement Services urged the Gilmores and others to buy into the center.

In one solicitation letter, Arizona Baptist Retirement Services announced: "We rejoice that construction will begin on our third cluster of garden homes this fall. . . . Now is the time to make your reservation (emphasis theirs). . . . We believe that if there is a modest appreciation of property values of only 4 percent per year, most of our residents will receive close to 100 percent return to them or their estates. We not only give you guaranteed equity based on your age, but we will also divide the gross profit with you as well. . . . Our mission is to serve older adults in every way that we can."

It didn't take much to convince the Gilmores to sell their house and pour $43,400 cash into a "garden home" at the retirement center. They liked the Baptist management and the grounds--the swimming pool and the spa and the location of the 100-residence center, tucked in the foothills of the Phoenix Mountains Preserve.

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Terry Greene Sterling