Christian Adviser & Sons Indicted in $18M Fraud

(CN) - A former Tennessee legislator and Christian financial adviser was indicted Wednesday along with his two sons for an alleged gold and silver fraud conspiracy.

Larry Bates was the CEO of Information Radio Network Inc. and First American Monetary Consultants Inc. He also served as a Democratic in the Tennessee General Assembly from 1971 to 1976.

FAMC did business trading precious metals, mostly gold and silver coins, according to the U.S. Department of Justice. IRN broadcasted politics and world economy information to radio listeners. It was acquired by Cross Platform Media last year.

Bates' two sons, Charles "Chuck" Bates and Robert Bates, both worked as economists with FAMC and Charles was the news director for IRN, according to a Justice Department press release.

"From May 2002 to October 2013, the trio allegedly encouraged customers, many of whom were Christians and elderly individuals, to purchase copious amounts of certain types of gold and silver from FAMC," the press release states. "All of the individuals targeted by the Bates were seeking advice and help from a supposed trusted Christian advisor and/or an alleged reputable Christian financial company, according to the indictment."

The Bateses are accused of using IRN radio to advertise gold and silver, allegedly stating that listeners needed to buy the metals to protect themselves from a predicted forthcoming economic, political and religious downturn they called "Mystery Babylon."

Bates and his two sons allegedly took payment for gold and silver that they sold through FAMC but only partially completed customers' orders or did not fill them at all. They used some of the embezzled proceeds for personal expenses and company operations, according to the indictment.

The scheme allegedly defrauded about 300 people across the country of more than $18 million, the Justice Department claims.

"Unfortunately, hundreds of these victims never received the coins they purchased. Instead, their money was used by the defendants to fund lofty salaries and exorbitant lifestyles," U.S. Attorney Edward Stanton said in a statement.

The 58-page indictment charges the Bateses with mail and wire fraud and conspiracy to commit mail and wire fraud. It lists 44 total counts and seeks the forfeiture of six Hardin County, Tenn. properties if they are convicted.

Each could face up to 20 years in prison and $1 million in fines per count, according to the Justice Department.

Bates was hit with a class action in 2011 for the alleged gold and silver scheme. That lawsuit accused him of using a "world's end, sky is falling" approach to target Christians in sales pitches.

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