Marin Developer Embroiled in ‘Spanking’ Church Sex Scandal had Role in Ponzi Scheme, Report Says

A wealthy Marin developer who’s embroiled in a bizarre San Francisco church sex scandal played a role in an unrelated Ponzi scheme a decade ago, according to a SF Weekly report.

William McLaughlin is today making headlines around the world for his role in a scandal that has rocked the landmark National Shrine of St. Francis Assisi in San Francisco's North Beach.

McLaughlin allegedly spanked a female employee with a wooden paddle and coerced her into having sexual intercourse in the sanctuary of one of the West Coast’s most storied Catholic Churches, the New York Daily News reports.

A decade ago, he played a role in another high-profile case.

McLaughlin introduced retired San Rafael mortgage broker William Osenton to a Tiburon couple who duped him out of $1.5 million, the 2007 SF Weekly report said.

Osenton is the former president of Pacific Guarantee Mortgage, a San Rafael based company that under his leadership over a 14-year period ballooned into a national behemoth pumping out billions in annual revenue.

McLaughlin in 2004 introduced Osenton to Rebecca and Terry Solomon, whom he knew through the St. Hilary Catholic Parish in Tiburon, the report said.

The couple was at the time involved in separate scams that would haul in $18 million. They played the role of Gatsby-style socialites to the hilt, holding lavish events at their Tiburon mansion to build the trust of potential investors, the report said.

Rebecca Solomon claimed to be the daughter of a general who worked under former Philippine President Ferdinand Marcos. She wore a diamond ring “the size of an apricot pit,” according to the report.

McLaughlin was not implicated in a federal case that sent the couple to prison for 90 months after they were convicted on 40 fraud-related counts, according to a 2008 Marin Independent Journal report.

He’s now at the center of a sex scandal that’s making headlines around the world.

McLaughlin was serving as chairman of the shrine's volunteer program at the time of the alleged incident.

Church officials fired him after investigating the allegations, the San Francisco Chronicle’s Matier and Ross report.

The allegations surfaced last month when a woman suspected of embezzling hundreds of thousands of dollars from the church filed a claim against the church alleging sexual harassment.

Jhona Mathews, 33, worked for the church as an administrative assistant. She says she was fired after breaking off her relationship with McLaughlin, who is in his 60s.

Mathews filed a claim with the state’s Department of Fair Employment and Housing on Nov. 18 alleging a persistent pattern of abuse according to 48 hills, a San Francisco news blog.

“I would not continue sexual favors in order to keep my job,” her complaint states.

“I could not tolerate the sexual demands or physical abuse in order to keep my job. … I had to engage in the sexual demands of Bill McLaughlin, including in the Sacristy on the premises of the Church…. These demands included. … spanking with a wooden paddle, kissing, fondling, oral sex, sexual intercourse, and sending me sexual email images.”

A police report alleging Matthews stole from the church was filed days before she filed the claim, KGO news reports.

Mathews has a history of credit card fraud, the church alleges.

Mathews first met McLaughlin when she was working for a carpet company brought into the church for renovations.

Soon after being offered a job at the church in February 2012, McLaughlin started sending Mathews sexually explicit photos and emails, her complaint alleges.

Mathews has denied the embezzlement accusations through her attorney, Sandra Ribera, who acknowledged her client has a “checkered past.”

Ribera said McLaughlin took advantage of her client, a single mom with a 2-year-old daughter, telling the Chronicle "She felt she had no choice.”

"He was dangling her livelihood over her head, and she had a daughter to feed."

Ribera described the lurid details of the alleged abuse in an interview with KGO news.

"Paddling with the wooden paddle, getting spanked in the sacristy of the shrine of St. Francis, which Catholics know, it's just appalling to hear as a Catholic and having sexual intercourse in the shrine of St. Francis," Ribera said.

McLaughlin, an animal rights activist, led a 2005 effort to airlift stranded pets in of New Orleans in the aftermath of Hurricane Katrina.