By Kurt Rivera
Fox 58
May 22, 2008
http://www.eyeoutforyou.com/news/local/18992904.html
[with video]
[with link to the judgment and liens files against Michael Galloway]
[with link to the District Attorney's complaint filed against Michael Galloway]
An alleged world wide web of deceit using the Catholic name. It's a business accused of ripping off thousands of dollars. It's headquarters, right here in Bakersfield.
The business calls itself "The Global Leader in Catholic On-line Donations and Payments", a sort of Catholic version of Paypal. But as we've discovered, they've been no pal to Catholic organizations stretching across the county and beyond, all in God's name.
While the Pope is considered the head of the Roman Catholic Church, you might say this man, Michael Galloway is the head of the world's largest Catholic based money transfer system on the Internet.
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His websites, "Catholic Financial Services", Catholic Online, Your Catholic Voice Inc. and Your Catholic Voice Foundation are the focus of a major lawsuit by the Kern County District Attorney's office alleging years of deceptive or fraudulent business practices.
The trail of Michael Galloway brought us here to Northern California to the beach community of Santa Cruz. This is where a Catholic non-profit group accuses Galloway of creating a financial nightmare.
Michael Hudson/Santa Cruz-Monterey Retrouvaille: For many of the people they made a not unreasonable assumption that this is an outfit that probably shares our values and is interested and concerned about Catholic families.
Michael Hudson, a retired attorney and John Corgiat, a medical sales rep. are volunteers fro Retrouvaille. Retrouvaille is french for 'rediscovery".
It's a nationwide Catholic in origin, non profit ministry, providing help to couples in troubled marriages.
Hudson is the financial coordinator for the Santa Cruz- Monterey Retrouvaille, Corgiat, treasurer for "Retrovaille of Northern California" which includes seven chapters, including Santa Cruz and Bakersfield.
John Corigiat, Treasurer, Retrouvaille of N. California: "Catholic Financial Services just has an appeal to it. We thought this would be something that would be a worthwhile thing to do."
Although Retrouvaille is no cost to couples, donations are welcomed. That's why the non profit looked to Catholic financial services or CFS for a safe, simple and secure way to receive or send money on-line. That's exactly what CFS touts on its website.
Couples send money, Retrouvaille accesses it through an on-line account, transferring donations to a Retrouvaille Bank Account. In turn, CFS charges a transaction fee to account holders. The system worked for about a year, then early in 2007, the problems began.
Michael Hudson, "The first indicator was we were charged fees that were incorrect and sought to have those corrected and credited back to our account."
But when they complained, to their surprise, they were stonewalled.
John Corgiat, "The biggest things were they wouldn't communicate with us. They wouldn't respond to our emails. If we tried talking to someone on the phone, they invariably would take a message. You couldn't talk to anybody, couldn't say anything."
In March of 2007, more than $15,000 sat in the Retrouvaille CFS account, cash effectively held hostage.
Michael Hudson, "We were desperate. I felt like we were deceiving the couples who donated money. "
That's when Retrouvaille instructed donors to "charge back" or reverse the transactions through their credit card company.
In response, CFS released some money back plus a barrage of what Hudson and Corgiat say were angry and threatening phone calls by non other than Catholic Financial Services founder, Michael Galloway.
Hudson: "In my case, he was going to have me disbarred, and complain to my boss."
Corgiat: "I should go apologize to my Bishop, I should go to confession and used the example of how would I feel if he went around telling people I was a pedophile. But I don't understand the relationship. He's holding our money. I am not a pedophile."
John Mitchell, Kern County Deputy District Attorney: "There's no guarantee that simply because it looks good, that it's a stable, trustworthy, credible entity."
Based on the N. CA. Retrouvaille's story, last summer Kern County Deputy District Attorney John Mitchell filed a complaint against Michael Galloway and his on-line business. Although no street address is listed on Galloway's websites, only a post office box in Bakersfield.
John Mitchell, Deputy District Attorney, "But as we talked to additional victims, looked at the facts, find out what had happened with the circumstances were, we came to realize that it was a significant problem involving a business located in Kern County. But with in fact, a national and international presence with a number of Catholic related victims."
From the west coast to east coast, the complaints mirror those of N. CA Retrouvaille.
- A group of disabled nuns in Branford, CT out $16,000
- The Archdiocese of New Orleans missing $4,000 in Hurricane Katrina donations.
- The Brotherhood of Hope in Boston owed $9,000.
- GOSPA FL. Inc. a group providing humanitarian aid to Bosnia and Croatia owed $9,000
Plus a number of Retrouvaille Chapters throughout the U.S. and North of the border in Hamilton, Ontario, Canada.
But the single largest amount owed is not to an organization, but to Mark Lombard of Orlando, FL. Lombard says he's out $95,000 after working 18 months an editor and chief of Galloway's Catholic news website, "Catholic Online.com". He flew back to Bakersfield for a State Labor Board hearing to claim his cash.
Also present, defendant and former boss, Michael Galloway.
Kurt Rivera, reporter, "Mr. Galloway do you have any comment about the proceeding?"
While he wasn't talking, Mark Lombard also withheld comment wanting to wait until the Labor Board makes it's decision.
According to the District Attorney, the grand total Galloway owes Lombard and Catholic non-profits so far, over $180,000 dollars.
So where might all the missing money be going? Perhaps for the Galloway's lavish 4 bedroom, 3 bath, 4,500 sq ft. Seven Oaks Grand Island home. Coincidentally, now in default.
And it's not just the District Attorney whose after Michael Galloway, but the I.R.S. Court documents we uncovered show numerous federal tax liens on Galloway's business dating back to 2004. The total, more than $303,000 dollars.
Even Galloway's non profit "Your Catholic Voice Foundation Inc." is suspect.
The organization's 2005 income tax filing obtained by Eyewitness News shows more than $211,000 dollars in donation income. However, his expenses over $208,000 dollars, the majority going to consulting, marketing and website design.
A month earlier, before the Labor Board hearing, we first tried to get Mr. Galloway's side of the story. We called numerous times but he never returned our call and neither did his lawyer. So we went searching for him.
Acting on a tip, we went to a central Bakersfield office building only to discover he had cleared out months ago.
Finally a tip, he was working out of a non descript, downtown area vintage home. We greeted him, but it was obvious he wanted nothing to do with us.
Kurt Rivera, "If Mr. Galloway is watching right now, what would you tell him?"
Michael Hudson, "Tell us why you can't pay us this month and let's work out a calendar or something like that. Anyway, we hope things improve."
The Santa Cruz-Monterey Retrouvaille remains short, $1,500 dollars from CFS not receiving cash since last summer.
To our knowledge, the Bakersfield Retrouvaille has never used CFS.
Back to the District Attorney's complaint. It alleges over the past four years, Michael Galloway has had financial difficulties causing him to divert donations. the suit also alleges Galloway has represented that his wife had a 'drug addiction', somehow impacting his ability to transmit payments.
Trial is set for September.
But there's more.
Eyewitness News has discovered Michael Galloway owns sixty-three Catholic related hyperlinks or website names including, the potentially lucrative, "Catholic.org."
According to the District Attorney...none of his websites are endorsed by the Vatican, the "U.S. Conference of Catholic Bishops" or any other leading Catholic organization.
And on the day we surprised Michael Galloway at his downtown Bakersfield headquarters he called us later that day claiming Kurt injured one of his employees and that he was filing a police report and we would hear from his attorneys.
To date, we have *never* heard from them.
The video in the story speaks for itself.
Review the judgement and liens files against Michael Galloway
Review the District Attorney's complaint filed against Michael Galloway
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