Investors sow but reap little
TAMPA - William Tayler knew the investment offer sounded too good to be true, but the man making the offer seemed so disarming, a professing Christian with a seemingly impressive track record. The investment opportunity: If Tayler would invest at least $100,000 with CSO Industries, he would receive distribution checks of $600 to $1,000 every week for an indefinite period. CSO Industries founder Charles Owens III of Clearwater told Tayler that his holding company had at least two businesses in its portfolio, a small energy company and a shoe company that sold Christian-inspired sandals and flip-flops. For a few months last year, the checks rolled in as promised, Tayler says. But in August 2008, the checks came in more sporadically - $200 here, $50 there. Now they've stopped completely, he and his attorney say.Tayler, 70, is among at least a dozen people in the Tampa Bay area and Washington state who are wondering what's become of the hundreds of thousands they invested in this tiny holding company, said attorney Joel Ewusiak, who's representing them. Many are planning to join a lawsuit that was filed in July against CSO Industries and Owens. In the lawsuit, 81-year-old Shirley Broderick claims to have lost $220,000 - her life's savings - by investing with Owens. Among other allegations, Broderick accuses Owens of making untrue statements about the investments, financially exploiting a vulnerable adult and selling securities that weren't registered with the state. She is seeking the return of her money. Through Friday, Owens had not responded to her allegations in court documents. He also could not be reached for comment in a visit to his Clearwater home or through multiple calls to his office receptionist in Tampa. A 'virtual office' Looking back, some investors in CSO Industries acknowledge they didn't ask enough questions of Owens before investing. Several told the Tribune they weren't entirely sure how CSO Industries invested their money. "I'm embarrassed that, with my corporate background - if it sounds too good to be true, it probably is," said Tayler, a semiretired businessman formerly with the energy company Dresser Industries. CSO Industries is a holding company that owns equity in other companies for investment purposes, according to its Web site, www.csoindustries.com. A picture on the Web site shows a prestigious office building near St. Joseph's Hospital in Tampa where CSO Industries keeps its headquarters. However, a receptionist there said it's actually a "virtual office": CSO Industries and numerous other companies share a receptionist and only reserve office space there as needed. Its Web site is surprisingly personal for an investment firm. There, Web surfers not only find out about CSO Industries' business strategy but also can also read about Owens' mentors, his favorite quote and favorite movies, "Rudy" and "Miracle." "These are by far the 2 best movies ever produced," Owens writes on the Web site. "These movies speak of how we can achieve our dreams through determination and commitment." He received associate, bachelor's, master's and doctoral degrees in ministry from Tyndale Theological Seminary in Texas, the Web site states. A representative at the college confirmed his degrees. Bankruptcy court records show he filed for personal bankruptcy protection in 2006. Public records and interviews with former business associates suggest Owens has had a colorful array of business interests, ranging from sandals to a small electric company. 'Jesus loves you' Three years ago, CSO Industries purchased a fledgling company called Shoes of the Fisherman. It produced a line of sandals and flip-flops that left an inspiring message in the sand with every step: "Jesus loves you," said Kathleen Farrell, a clinical psychologist who founded the company and sold it to Owens. Shoes of the Fisherman never sold enough shoes, even after Owens purchased the company, she says. She's not clear what happened to the company, but she thinks about 25,000 Jesus Loves You shoes were stored in a Palm Harbor warehouse. A second business under the CSO umbrella is a small electric utility called USave Energy. It's not clear from the company's Web site where USave operates, but it has done business in Texas. At one point, USave had 564 customers in Texas, said a spokesman for the Public Utility Commission of Texas. By 2005, USave failed to meet Texas' financial requirements for a utility company, so the commission ordered the transfer of all its customers to other utilities, the spokesman said. Investors who gave money to Owens now say they didn't probe deeply enough into CSO Industries' investments. Tayler, the semiretired businessman, met Owens through the latter man's mother, he said. Tayler, Owens' mother and Owens attend the sprawling Countryside Christian Center church on McMullen-Booth Road in Clearwater. At some point, Tayler and Owens began talking about the steep losses Tayler was suffering in his retirement account. Owens offered a solution. His holding company offered people a chance to invest large sums, often starting at $100,000. Ewusiak, Tayler's attorney, said Owens offered investors two methods of investing. In one, they could put money into an investment vehicle that would pay them weekly disbursement checks. The other was an equity investment in CSO Industries, which could grow over time. Tayler chose the option promising weekly returns. Tayler was skeptical at first, but he dropped his guard because Owens said he had spoken to multiple billionaires, including Warren Buffett, and seemed to have evidence of consistent investment returns. Tayler received what amounted to an investment prospectus: documents that spelled out the investor's equity position in CSO Industries and samples of recent investor returns, he said. Owens also knew many of the same people Tayler did at Countryside Christian Center. John Lloyd, pastor of the church, said Owens has been an active member. Lloyd has never seen him soliciting investors there. Tayler thinks he has. Owens "basically said that every major investment decision came from the Lord," Tayler said. Thou shalt not sue Tayler could be violating a church tenet if he takes legal action. Part of the Countryside Christian Center's statement of faith, posted on its Web site, says the church believes Christians are prohibited from bringing civil lawsuits against other Christians over personal disputes. Tayler said he and other church members signed a pledge that they wouldn't sue other church members, but he decided to go ahead because the church didn't take action. Two other investors, Broderick and furniture store owner Dave Smith, also said Owens' faith came up frequently. "Charlie was always, 'God bless you' and that stuff,'" said Smith, who when he's not running Office Furniture Now in Pinellas Park performs as a Johnny Cash impersonator at local shows. The $65,000 he invested with CSO Industries wasn't the bulk of his assets, and Smith hasn't pursued legal action against Owens. So far, only Broderick is a named plaintiff in a Hillsborough County Circuit Court lawsuit against CSO Industries. Ewusiak, her attorney, said he expects to add as many as a dozen people from the Bay area and Washington state as plaintiffs in coming weeks, including Tayler. Broderick, a retired homemaker, came to invest in CSO Industries through her son, 53-year-old Tom Rohde. Rohde said he infrequently has attended church at Countryside Christian Center and began getting calls from Owens on his cell phone. He assumes Owens found him through a church contact. Rohde didn't have any money to invest but thought Owens' business might provide better returns for his mother than her annuity. His mother invested $220,000 with CSO Industries by cashing out her annuity, refinancing her St. Petersburg storage business and tapping into $20,000 in savings. Like the other investors, Broderick started getting weekly checks from CSO Industries, and she recouped $32,000 of her investment, according to her lawsuit. However, the checks stopped coming by November. Long-term investment Today, Broderick and Tayler have sought to have their money returned. Owens has declined, though, claiming the unexpected downturn in the economy prevents him from returning the money at this time, their attorney said. Owens also has told some of the investors their money always was meant to be locked up for at least five years, although Rohde and Broderick are seeking the money's return now, claiming he didn't live up to his firm's no-risk investment. Tayler said he met with the Florida Office of Financial Regulation about Owens, but that agency could not comment. Today, Broderick, her son and Tayler wonder why they didn't dig deeper into CSO Industries before investing. They acknowledge dropping their skepticism when the disbursement checks came in week after week and hearing Owens' assurances. "He told me many, many, many times about CSO Industries and how he has never lost any money," Rohde said. "Charlie said, 'Look, I would rather cut off my arm than lose money.'"
Reporter Michael Sasso can be reached at (813) 259-7865.