Bill for too much faith is 6.2m pounds : Naivety led a Salvation Army colonel into a questionable scheme. Steve Boggan reports
Friday 09 April 1993
That was how General Eva Burrows, the head of the Salvation Army, yesterday described the charity's new relationship with Colonel Grenville Burn, the man whose faith and naivety cost pounds 6.2m.
It was Col Burn's inflated sense of trust and his blind desire to raise impossible sums of money for the charity that allowed Stuart Ford and Gamil Naguib, two financiers, to allegedly spirit away the dollars 8.8m he gave to them in a none-too-elaborate scheme that promised ludicrously high profits.
Col Burn had been head of public relations - which involves fund-raising - for only a short time before he was introduced to Mr Ford, 41, who once claimed to have served in the SAS. Mr Ford's schemes excited Col Burn, but terrified a three- strong committee of senior financial advisers from the City who told the Salvation Army to steer clear as long ago as last April.
However, the advisers reckoned without the inherent weaknesses built into the system. Senior administrators are culled from ordained ministers who grow in seniority with years of service, rather than on expertise. The charity's officers are provided with homes, cars and a salary of only pounds 3,500, so their grasp on financial affairs could be called into question.
When investigators discovered that Col Burn's name, rather than the Salvation Army's, was on the deeds of a pub in Scotland that had been part-bought with some of the missing money, they took it as evidence of his complicity. However, they soon changed their minds.
'You have no idea how naive this guy was,' one officer said. 'If you have ever bought a house, you know about deeds and charges, so we thought he should have known too.'
Col Burn had decided to plough on with a plan to buy standby letters of credit, banking devices that can be bought at a discount before their date of maturity and sold at full face value when that date is reached.
Col Burn and Col Ivor Rich, the business administration secretary, were given permission by Commissioner John Larsson, United Kingdom head of the Salvation Army, to invest dollars 10m ( pounds 6.62m) in such letters of credit. As signatories to a bank account opened in Antwerp, Cols Burn and Rich had control of the money with a third signatory, Stuart Ford.
When Mr Ford introduced Gamil Naguib to the plot, Mr Naguib asked for the money to be put into an account, with Naguib, Ford and Burn as signatories. Without telling his superiors, Col Burn agreed and, as a minority signatory, the Salvation Army had lost control of the money. It vanished soon after.
- 1 Al Pacino on suffering from depression: 'It can last and it's terrifying'
- 2 Half of young women unable to ‘locate vagina’ and 65% find it difficult to say the word
- 3 Saudis risk new Muslim division with proposal to move Mohamed’s tomb
- 4 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
- 5 Mexican woman becomes world’s 'oldest person' at 127
Perez Hilton apologises for publishing Jennifer Lawrence naked photo leak
Jennifer Lawrence 'nude photo hacker' claims there are hundreds more celebrity images to come
Victoria Justice on naked photo leak: 'Let me nip this in the bud right now – pun intended'
Saudis risk new Muslim division with proposal to move Mohamed’s tomb
Ariana Grande nude photos leak: Pictures are completely fake, say singer's representatives
Rotherham child sex abuse scandal: Labour Home Office to be probed over what Tony Blair's government knew - and when
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Ashya King: Parents of five-year-old boy refused permission to visit him in hospital and denied bail at Spanish court
With Douglas Carswell joining Ukip, my party has taken another giant step forward
When elitism grips the top of British society to this extent, there is only one answer: abolish private schools
Ashya King: 'Cruel NHS has not given us the treatment we need', says father of five-year-old with brain tumour who fled to Spain
Main Pay Scale : Randstad Education Leeds: Biology Teacher to A Level - Female...
£26000 Per Annum: The Green Recruitment Company: Job Title: SAP Assessor Job T...
£85 - £120 per day: Randstad Education Preston: Randstad Education is urgently...
£30000 - £35000 per annum + Benefits: Ashdown Group: HR Advisor (Employee Rela...