Baptist church accused of keeping embezzled “blood money”

John Franklin Howard loved First Baptist Church of Carrollton so much that he apparently dropped more than $200,000 into the collection plate over several years.

But a Grapevine company calls it “blood money” and wants it back, saying it was part of the millions of dollars Howard embezzled, using some to pay hit men to try and kill his wife in 2012.

In a lawsuit filed in Tarrant County civil court last week, Raley Holdings Llc. said that Howard, a former chief financial officer, also used part of the cash he stole from the company to live a lavish lifestyle, support a mistress in California as well as make donations to the church over 21/2 years.

“It was blood money and it was not Howard’s to give,” the lawsuit states, saying the money all came from the same source.

Howard was convicted in 2014 and was sentenced to life in prison for the attempted capital murder of Nancy, now his ex-wife. She was shot in the face in the garage of their Carrollton home by a man who approached her demanding that she hand over her purse.

She survived but lost her left eye.

Matthew Bobo, the attorney representing Raley Holdings, said the company started reaching out to the church more than a year ago about recovering the money and even provided the church with documents tracing the cash. Eventually, they were told to file their lawsuit, he said.

“When Howard was first arrested and terminated, we immediately did a forensic accounting,” Bobo said. “We knew very early on that the church had received a significant amount of money.”

Scott Ward, an associate pastor at First Baptist, said in an email that the church declined to comment due to the pending litigation.

A 2014 D magazine article portrayed John Franklin Howard — the son of a Baptist preacher — and his wife as devout members. Their son is quoted as saying that “If the doors to First Baptist were open, my parents were probably inside.”

Howard, described in court documents as a certified public accountant, worked for Raley Holdings, a distribution company that worked in the Middle East for the military. In that role, Howard was paid $10,000 a month to advise the firm on investments and taxation issues, records state. Raley Holdings is owned by Richard Raley of Colleyville.

With respect to money earned overseas, Howard assisted and directed the company in transferring the money into bank accounts of which Howard had made himself the sole owner. From those accounts, between 2009 and 2012, he misappropriated more than $6 million, court records state.

During this time, Howard, who had been married to his wife for more than 25 years, was was having an affair with a California woman. Through another company Howard started, he bought an $850,000 house in Santa Cruz, Calif., and a $350,000 Lake Tahoe condo, court records state.

He also used some of the money to hire men to kill his wife, the lawsuit states.

Raley sued Howard soon after he was arrested, and forensic accounting traced some of the money Howard misappropriated to the church. In late 2015, an arbitration panel awarded Raley $8.5 million, which includes the $6.7 million taken from the company, $650,000 in punitive damages and $1.1 million in interest, records show.

Calling the money taken from the Raley companies “unjust enrichment,” the company contends that the church “holds money that in equity and good conscience belongs” to Raley, court records state.

Though Howard always gave money to the church, often up to $15,000 a year, in that 21/2years his donations jumped to over $200,000, Bobo said.

“This money is a no-brainer. The money came out out of Raley’s accounts into the sham corporations that Howard had set up,” Bobo said. “It is blood money.”

This report includes material from the Star-Telegram archives.

This story was originally published June 1, 2016 at 4:53 PM with the headline "Baptist church accused of keeping embezzled “blood money”."