L.A. Preacher and Ex-FBI Agent Jailed for Fraud

A Los Angeles preacher has gone from living his “American dream” as a police officer and undercover FBI agent to serving four years in federal prison.

Darin McAllister now says his life today is an American nightmare, as he serves his sentence in an eastern Kentucky federal prison for fraud. According to reports, blind ambitions, carelessness along with the national housing crisis are to blame for the 46-year-old’s rapid descent.

McAllister earned a divinity degree from Oral Roberts University and joined the West Angeles Church of God in Christ in South L.A. in 1990. He served as an intern and a staff minster before teaching the men’s Sunday school. He also led the youth choir, while his gospel-singing wife, Judith, became the minister of music.

Bishop Charles E. Blake, who McAllister ministered aside, said Blake was a fine, upstanding individual, according to The Los Angeles Times.

“He was committed to family and to church and the progress of his community,” Blake said.

McAllister continued to move up, joining the LAPD in 1991. He said his motivation to enlist came from the Bible verse, I Corinthians, which reads, “Become all things to all men.”

In 1996, he was hired by the FBI to do undercover work, mainly to gather street intelligence. He looked at the Bureau as the premier law enforcement agency.

“I considered them the best,” he told the Times.

His fortunes began to change in 2003, when the FBI transferred him to Nashville, Tenn. He went to Nashville with over $200,000 in profit from selling his California home. McAllister began to invest in real estate ventures, buying and renting duplexes. His real estate agent, Andy Clough, said McAllister did this to help his kids with school and to put towards his retirement.

However, when the housing market began to collapse, McAllister began losing his tenants and his money. He couldn’t keep up with his loans and banks foreclosed his properties.

According to McAllister, by 2009, he had to file for bankruptcy because he couldn’t recover from debt. Then examiners noticed that he had lied about his income in lending documents, inflating the numbers by hundreds of thousands of dollars.

The bank contacted federal law enforcement and McAllister was told by his supervisor that he was under investigation by the Justice Department’s Inspector General Office. In May 2010, he was charged with 19 counts of wire fraud, false declarations and other felonies. He was convicted December 2010 of 15 counts of wire fraud and three counts of bankruptcy fraud.

U.S. District Judge John T. Nixon sentenced him to four years in federal prison and a $675,000 fine. He must also serve three years’ probation after his release.

“I was devastated … shocked. It was like somebody hit me in the stomach with a sledgehammer,” McAllister said.

McAllister’s defense attorney, George T. Hawkins said during the trial that his client was naïve and failed to study documents closely. He also blamed SunTrust loan officer Wes English for inflating McAllister’s assets to win a substantial commission, reported the Times.

“Darin was careless … once he went into a room and signed 10 different loans. … He should’ve caught some of the bad applications,” Hawkins said.

According to FBI sentencing documents, McAllister devised a scheme to defraud SunTrust Mortgage Co. Inc., in connection with the purchase of rental properties worth $1.25 million in May and July 2006. The FBI says he also devised a scheme to defraud the SunTrust Bank in connection with a $100,000 line of credit and making three false statements in connection with his bankruptcy petition in 2009.

Ironically, McAllister was the lead investigator for “Operation Blighted Officials,” an investigation of fraud involving a Louisiana mayor and police chief. He was under investigation by the government at the same time he collected information for Operation Blighted Officials. Both parties were charged at the same time.

McAllister wants to clear his name and believes the entire situation is over his head.

“This whole thing is bigger than me. A lot of people purchased property and there were appraisers and loan officers who were shoddy and playing tricks. If they could dupe me as an FBI agent, who was safe?” McAllister said.

Now McAllister, who is awaiting his appeal, envisions himself ministering to the nation’s capital once he is released. He said that being in prison allows him to put his trust in God and he will grow from that.

“I will pass this test … God will allow me to handle this,” he said.