Former Pastor Ordered to Pay $1.4 Million in Securities Fraud Case

By Daniel Hawn

Published on March 17, 2008

Douglas Alan Scott, 48, was sentenced March 7 after being convicted of securities fraud and theft charges two months earlier. Scott, who led the now defunct River of Life Church, was found guilty of recruiting investors for a hedge fund scam operated by Colorado Springs-based XL Capital Partners Inc. The company brought in $24 million from investors, including several area churches.

During his trial, Scott claimed that he was innocent and that XL founder Hamilton Alan Bird was the one responsible for bilking investors because he managed the fund's finances as well as disclosures to clients.

Fourth Judicial District Judge J. Patrick Kelly found otherwise.

He sentenced Scott to 15 years' probation and ordered him to pay $1.4 million for his role in the scam. In handing down the sentence, Kelly charged Scott with knowing much more than he led on in court.

Though the scam duped investors out of more than $12 million, Scott was only ordered to pay $1.4 million because that was the amount he was shown to have been paid.

Bird is scheduled to appear in court March 31 on fraud and theft charges related to the demise of XL. His prior convictions mean that his sentence could be tripled if he's found guilty.

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