Pastor Rod Parsley's World Harvest Church Wrangling With Cincinnati Bank: Fifth Third Won't Take Back Church's $5.8 Million Jet

  

Stock Photo Of Gulfstream Jet

CINCINNATI (TDB) -- The dispute has been flying under the radar.  World Harvest Church said it has paid off its five-year lease and wants to return a Gulfstream G-III private jet.  But the bank in Cincinnati doesn't seem to want the plane, which is listed with a $5.8 million lessor's cost.  A lawsuit filed in Hamilton County Common Pleas Court by the mega-church near Columbus says:  "Despite the church's return of the leased aircraft in full compliance with the terms of the Aircraft Lease Agreement, the Bank has arbitrarily, unreasonably, and in breach of the Aircraft Lease Agreement, refused to accept the return of the leased aircraft."

The church is located in Canal Winchester in Franklin County.  Senior Pastor Rod Parsley is an evangelist, television host and author.  He also has been involved in GOP politics and in 2008 endorsed John McCain's campaign for president.  He withdrew the endorsement after McCain rejected it and criticized Parsley for saying that Islam was a false religion that needed to be destroyed.  Court records show the church leased the plane in August 2005.  It put $900,000 down and made 59 monthly payments of $26,832.05.  That means World Harvest Church spent $2.48 million to lease the jet,  which has been based in a hangar at Rickenbacker Airport.  There is nothing in the court files that shows why the church needed the jet in the first place.  Parsley's church said it is spending substantial amounts of money to keep the Gulfstream jet in flying condition since the lease expired in August.  It wants a court order that would force the bank to take the plane off its hands:

"As a consequence of the Bank's breach of the Aircraft Lease Agreement, the Church has incurred and will continue to incur substantial monetary damages related to preserving and protecting the condition of the leased aircraft, including maintaining the aircraft in a flight ready status and current with the manfacturers' and FAA's standards of maintenance and other necessary and related expenses, all of which expenses are the Bank's obligations as the owner upon return of the leased aircraft . . ."

From Wikipedia, you can learn about Parsley.  The online encyclopedia also has the following information about Gulfstream G-III jets:

General characteristics

• Crew: Two or three
• Capacity: 19 passengers (standard seating)
• Length: 83 ft 1 in (25.32 m)
• Wingspan: 77 ft 10 in (23.72 m)
• Height: 24 ft 4½ in (7.43 m)
• Wing area: 934.6 sq ft (86.83 m²)
• Aspect ratio: 6.0:1
• Empty weight: 38,000 lb (17,236 kg)
• Max takeoff weight: 69,700 lb (31,615 kg)
• Powerplant: 2× Rolls-Royce Spey RB.163 Mk 511-8 Turbofan, 11,400 lbf (50.7 kN) each

Performance

• Maximum speed: 576 mph (501 knots, 928 km/h) (max cruise)
• Cruise speed: 508 mph (442 knots, 818 km/h) (long range cruise)
• Stall speed: 121 mph (105 knots, 194 km/h)
• Range: 4,200 mi (3,650 nmi, 6,760 km) (eight passengers, IFR reserves)
• Service ceiling: 45,000 ft (13,716 m)
• Rate of climb: 3,800 ft/min (19.3 m/s)

Cincinnati Bank Charging $8 Fee To Cash Democratic Party Pollworker Paychecks: Fifth Third Accused Of Gouging

Bank Fees Anger Dems

CINCINNATI (TDB) -- The executive director of the Hamilton County Democratic Party says poll workers are being forced to pony up 8%.  The  checks are written on an account Democrats have at Fifth Third Bank.  Caleb Faux compared the check cashing fee to legalized larceny:  "It's basically the bank stealing money.''  So far, the local Democratic Party in Cincinnati has written 200 checks on its account, each for $100.  Faux said poll workers who go to Fifth Third branches and don't have accounts at Fifth Third are being given $92 on a $100 check.  He said the party has its money in that bank.

"What entitles Fifth Third to take 8% out of their money off the top?  This is outrageous.  The poll workers worked about twelve and a half hours Tuesday standing out in the cold.  They earned the money.  They participated in the process.  They are good citizens.  Some of them are poor people.  They need every penny.  The check should be a piece of paper that entitles them to walk into Fifth Third and walk out with a hundred bucks.  That's what they got paid.  I think we'll have to move our accounts.  We're not a big account, but there are a lot of Democrats.  The bank's fee is just not fair.  It's arrogant to impose a fee on a check drawn at the bank."

Fifth Third took $3.4 billion in federal government bailout funds from TARP, which was passed in the waning months of President George W. Bush's administration.  The Cincinnati-based banking company says it hopes to have a plan in place later this year to repay the bailout money. 

Fifth Third Bank's Chief Investment Strategist John Augustine: Economy Won't Be Normal Until 2017

CINCINNATI (TDB) -- The Cincinnati bank's expert spoke in Indianapolis this morning.  He thinks the U.S. is in for a long slog, and apparently it makes no matter who wins the mid-term elections next month.  Really, if John Augustine is correct and the economy stays out of whack for seven more years, that begs a question: Then what is normal?  The Great Recession started in late 2007 and officially ended in July 2009.  He sees the effects lingering for nearly a decade, and added that most Americans don't believe the recession has ended.  Augustine's comments were reported by the Indianapolis Business Journal, which noted that Augustine said business closings still outpace openings. The Fifth third strategist said the odds don't favor a double-dip recession. But there is a 33% chance the economy could fall back into recession by March 2011.

Is Cincinnati's Fifth Third Bank Treading PayDay Lending Territory? Offers 'Early Access' Loans At 120% APR

By Harry Callahan

Special to The Daily Bellwether

CINCINNATI (TDB) -- And we thought the payday loan industry was history. Check out the accompanying graphic. There's a sentence that says, "The Transaction Fee is $1 for every $10 borrowed. This equates to an Annual Percentage Rate (APR) of 120%." That's not from a Mafia loan shark. It's from a national bank based in Cincinnati. Not only have payday loan stores like Check 'n Go and CheckSmart managed to survive a 2008 Ohio law capping the annual percentage rate on their loans at 28 percent, but now banks have gotten into the act. Only they don't call them "payday loans." Instead they're called "Early Access" advances by Fifth Third Bank, which fronts up to $500 to customers with direct-deposit paychecks, and "Checking Account Advances" at rival USBank.

Whatever they're called, they're pretty much what the payday lenders offer to people who can prove that they have regular income and a checking account. The Ohio General Assembly, Gov. Ted Strickland and Ohio voters thought they had strangled the payday loan industry by cutting maximum APRs from 391 to 28 percent. But lenders of all sort found ways around the law by charging loan origination fees, redefining loans as advances and using their national bank charters to shield themselves from the state interest rate cap. The APR at Fifth Third and USBank is sky high and, as Fifth Third admits in its terms and conditions, "This is an expensive form of credit."

Consumer groups have assailed payday lenders as predators of the working classes, but bank overdraft fees are awfully predatory, too. Facing more pressure from regulators to rein in their highly profitable fee programs, banks are now steering their checking account customers into payday loans. By the time all banks complete that transition, Ohio could have more payday loan outlets than ever. But they'll be known as banks.

Former Enquirer Publisher Bill Keating Feuds With Financial Advisor: Claims $2.5 Million Loss On Gannett Stock

CINCINNATI (TDB) -- So far, this peek into the lives of the rich and famous, about wealth and how it is managed in Cincinnati, hasn't seemed to make many ripples here in the city where it is unfolding. Bill Keating, a former GOP congressman from Ohio who ran Gannett's newspaper operations in Cincinnati and Detroit, contends his $20 million investment portfolio was mismanaged. He wanted his newspaper stocks dumped, and dumped quickly. His lawyers claim Keating and his wife, Nancy, took a $6 million hit on holdings in Gannett (43,558 shares) and Fifth Third Bank (225,000 shares) that Keating ordered aggressively liquidated. Keating says his orders were not followed. Keating says in an affidavit filed with his lawsuit in Hamilton County that his instructions were given before the economy slipped into recession and the share prices sank to historic lows. Both the bank and the newspaper chain have been beaten up on Wall Street -- Fifth Third for lackluster management and Gannett for the erosion of print publishing in the face of online challenges. Keating had been an insider at both corporations. He served on Cincinnati-based Fifth Third's board for much of the 1980s and 1990s. At Gannett -- the nation's largest newspaper publisher -- he ran the Cincinnati Enquirer, was president of the company Central Newspaper Group, was v.p and general counsel of Gannett Co. Inc., and ran the Detroit Newspaper Agency which published the News and Free Press. He was chairman of the Associated Press from 1987-1992. His brother, Charles, was the poster boy of the S&L scandal in the early 1990s.

In his Jan. 6, 2010 affidavit, Keating said: "Both before and after investment accounts were opened with SWRW LLC, I and members of my family made clear on numerous instances our instructions to William T. Sena Sr. and William T. Sena Jr., to immediately liquidate the Fifth Third and Gannett holdings and reinvest the process so as to create a well diversified investment portfolio."

The Sena's see things differently. They have submitted several memos (see an example above) that were sent to Keating about efforts to manage the $20 million account. The financial advisors said their strategy was to unwind the portfolio piecemeal. The Sena's lawyer, Charles Reynolds, said during a Hamilton County Common Pleas court hearing last month that Keating gave no direct order to liquidate the shares:

"There are no documents which say sell Fifth Third. There are no e-mails that say sell Fifth Third or Gannett. There is nothing in writing that exists that says sell Fifth Third. All we have is the oral representations supposedly in place to sell Fifth Third. It is a 20-month relationship. Each month the Keatings got account statements. Several times a week, there are phone calls. Interspersed with that is written communications from Bill Sena describing what the account is doing."

Reynolds also noted during the hearing that Bill and Nancy Keating could have sold their stocks at any time on their own:

"Mr. and Mrs. Keating were the trustees at all times in question and they could have at any point before or after June 2007, diversified their portfolio. In fact, it would have been a simple matter to buy an S&P 500 fund and achieve complete diversification without the need to buy individual stocks. They elected not to do that. They elected to come to Sena, Weller, Rohs, Williams and Mr. Sena Sr., in particular, to use his investment expertise to make those stocks decisions, including the buy and selling of Fifth Third stock."

The lawsuit is pending under the caption Charles Miller, Trustee et al v. Sena Weller Rohs Williams LLC et al, Case No. A0911952. It is assigned to Hamilton County Common Pleas Judge Jerome J. Metz, who has scheduled a case management conference and hearing for Feb. 17 in his Cincinnati courtroom. The docket is available on the clerk of court's website.

Cincinnati Money Manager Peter Klein: He's Singing In The Break Up G.E. Chorus

CINCINNATI (TDB) -- General Electric Co. traces its roots back to Thomas Edison, and the conglomorate is headed by another Ohio boy, CEO Jeff Immelt, who grew up in Cincinnati. GE's aircraft engine division is alongside I-75 in the Cincinnati suburb of Evendale, and the factory complex remains one of the state's largest employers and an a icon of Ohio's once-unmatched manufacturing might. But GE's stock is near 4 1/2-year lows, and a Fifth Third Bank money manager is wondering publicly if it is time for the corporate giant to start selling off big hunks of its holdings to raise the share price for investors. That should be news in Cincinnati -- home of both the bank and one of GE's largest divisions, along with thousands of GE investors and employees. Still, the local money manager's concern this week seems to have escaped notice by the local media.

Peter Klein, a senior portfolio manager at Fifth Third Asset Management, had this to say:

"Having a more focused organization probably would benefit that organization (GE). Whether it was focused on media or focused on financials or focused on manufacturing . . . management at least ought to entertain that approach that says, 'Let's separate them and see what would happen."

GE owns NBC Universal, but also makes railroad locomotives, appliances, power plant turbines and jet engines. Some say it is hard to see how owning Meet The Press (and finding a replacement for Tim Russert) and producing TV show mixes with manufacturing engines for Boeing airliners. Fifth Third's Klein was quoted in this Reuters business news story June 16 that pointedly raised the issue of whether it is time for GE make changes and shed some of its holdings.

[UPDATE: Fifth Third lost over 27% of its share value today. Asked why, some analysts were quipping: "Because it's open." GE fell 2.25%.]