The Derwin Montgomery indictment on Aug. 29 fills in some of the details that the news cannot: an itemized list of the alleged fraud — 14 counts, each for less than $5,000, totaling $23,940.25, and a 15th count alleging embezzlement of federal funds that brings the Feds’ total to $26,299.57. That’s how much they say Montgomery siphoned off from the Bethesda Homeless Center during a 3-month period between 2018-20, where he served as executive director making more than $73,000 a year… until he abruptly resigned in December 2020.
According to the document, the money was spent on hotels and airfare, use of his car and a couple hundred bucks at a Las Vegas strip club. The bulk of it, $23,000, went to Montgomery’s media-production company, Uplift Media, for creative services like video production and marketing. Uplift Media LLC has since been dissolved.
It’s a bad look for the former Winston-Salem city councilman and state legislator, who is the current pastor at First Baptist Calvary Church.
But a parsing of the indictment elicits more questions than answers, beginning with the fact that $26k is not all that much money, even for the nonprofit Bethesda Center, which according to tax documents took in more than $1 million in revenue from donations and grants in 2020 alone.
Not that anyone should be stealing from them! But the document lacks key context regarding the nature of Montgomery’s travel — was it for work? — and right-sizing the amounts. For example, the $1,000 expense for a “luxury” hotel in Los Angeles would barely cover a single night in one of that city’s finest hotels. A night at the Hotel Bel Aire, for example, is more than $1,200. As for $260 in strip-club dollars… well, people go to the strip club on expense accounts all the time, and $260 is not exactly a wild night.
Since Montgomery has pleaded not guilty, these details should emerge in court.
It does seem that Montgomery violated a conflict of interest in hiring his own media company, and the amounts — all less than $5,000, which meant they did not need board approval — are sus.
But we don’t know the difference between what Uplift provided and that of the “free” company that was willing to work as a charitable donation, a deal set up by “Board Member-1,” as they areknown in the indictment. Citing a print ad contract with the Winston-Salem Journal as evidence of overlap in creative services seems like a reach.
As for charging Bethesda for use of his car… he’s on his own for that one.
But the biggest question is the impetus for the investigation. Surely Montgomery’s $25k or so, which amounts to about $10,000 a year, did not trigger an IRS audit and it is likely not the most egregious example of fraud in North Carolina’s Middle District. Why would federal agents hone in on such small potatoes?
And why now?
Join the First Amendment Society, a membership that goes directly to funding TCB‘s newsroom.
We believe that reporting can save the world.
The TCB First Amendment Society recognizes the vital role of a free, unfettered press with a bundling of local experiences designed to build community, and unique engagements with our newsroom that will help you understand, and shape, local journalism’s critical role in uplifting the people in our cities.
All revenue goes directly into the newsroom as reporters’ salaries and freelance commissions.