New Salem Missionary Baptist Church in Tampa, Florida seeks Chapter 11 bankruptcy protection in wake of pending foreclosure proceeding from Fifth Third Bank. The church is led by Rev. Henry Lyons, known for creating controversy by scandalizing The National Baptist Convention USA during the late 1990’s. Trustees of the church claim they made the decision to file, not Lyons.
The church sought Chapter 11 protection in July. According to documents filed the church has close to $900,000 in assets with liabilities totaling $1.2 million. Fifth Third Bank claims the church failed to make payments on an outstanding loan of $1.1 million that was taken out in 2007. The loan was used to acquire additional land to expand the campus. The bank claims they made attempts to work with the church on arrangements to help lower mortgage payments.
The church used interest in 9 other properties to obtain the loan. According to the bank the interest has been “conveyed away.” The bank alleges that some of the property used to obtain the loan no longer belongs to the church. In fall 2009 the church defaulted on loan payments and in 2010 the bank sought foreclosure that has since caused conflict for both parties.
During the late 1990’s Lyons was president of the National Baptist Convention USA. He was convicted by state and federal officials in 1999 of stealing $4 million from corporate partners of the organization. Funds were used to purchase luxury items including a Rolls-Royce and a waterfront property valued at $700,000. He was released in 2003 from prison after serving nearly 5 years.