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Osage church money allegedly given to struggling church in Bagley

OSAGE -- The case of the missing funds from Grace Community Church of Osage is likely one involving a modern day apostolic parable - taking from Peter to pay Paul.

Last week Becker County authorities closed a criminal investigation, finding no reason to press charges against former pastor Bill Ullom.

Church members, after considerable discussion, contacted Becker County authorities in early May after discovering an estimated $350,000 of unaccounted for expenses.

Some church members did not "want to report it to authorities and get the church's name cast in a negative way," according to the Becker County Sheriff's Department.

The investigator's report was provided late Friday to the Enterprise after assistant Becker County attorney Gretchen Thilmony declined to prosecute Ullom for the financial discrepancies.

The investigative report stated that church deacons believed "several loans have been acquired through the church by Pastor Bill Ullom without their knowledge."

The money was allegedly diverted to a struggling Baptist church in Bagley for extensive repairs.

Thilmony said she waited to publicly release her decision not to prosecute until she had notified church members.

Nonetheless, her decision was a surprise to church deacons Joann and Bill Christlieb.

"They're not going to investigate this anymore?" Joann said. "That's disappointing. It's devastating to a lot of people."

She said church officers - she is the treasurer - were unaware of the extent of the money diverted to the Bagley church and questioned the necessity of it. She said some money was given to the Bagley church as "gifts," but she was visibly astonished at the figure in the investigator's report.

"It was a turnkey operation," she said of the Bagley church. "It could have been left alone. We could have re-established it without all the remodeling."

She said Ullom oversaw both churches. The investigator's report stated he relieved the churches' bookkeeper of his duties and assumed the bookkeeping himself, along with check-writing responsibilities.

Joann said the Bagley church has less than 10 members and approached the Osage church for financial assistance.

She said deacons do have financial oversight now and the ability to write checks "but it's much more guarded now."

She said the Osage church's building debt was supposedly paid off, but now she's wondering about the status of it, and where the money to build originally came from. She said Bill Ullom obtained the building capital "from a source."

Although the investigation found that some money was diverted to pay Ullom's daughter's college tuition, purchase a truck for Ullom's brother and the pastor took out two notes and signed the name of the former treasurer to several checks, the investigator concluded the accountant "found no evidence of Pastor Bill Ullom taking any money for the church for himself."

Ullom, who was relieved of his duties after the expenditures came to light, explained to investigators the tuition was in lieu of some of his $1,500 monthly salary and the pickup purchase was to reimburse his brother for labor on the Bagley church.

The Enterprise has been unable to reach Ullom; church officers said he moved to Hawaii.

There appeared to be differences of opinion within the church as to whether Ullom had the authority to spend the funds, and whether church officials were fully aware of the expenditures.

"Pastor Ullom stated that in hindsight he wished he would have done some things different," the report states. But it quotes the accountant that, regarding the loans, "Ullom neither had the authority or the authorization from the board to do this."

Joann said the Osage parish has been covering "unreal" overdraft expenses Ullom incurred at two banks, and maintains funds are still unaccounted for. Church officers have retained an attorney and an accountant to try to recreate missing financial ledgers.

"What a nightmare," she said of the unclear financial picture the church faces.

"If he didn't put it in there you can't retrieve it" she said of the bank's records.

She worries the adverse publicity will impact the church's dwindling membership.

"It's just so devastating," she said.