Why does the devil say that Deacon Peabody will be damned? What else do we learn Deacon Peabody has done which might be seen as a sin?

The Devil exposes Deacon Peabody as an unrepentant hypocrite, who needs to look to his own sins in the same way he concerns himself with the sins of others. The Deacon is also exposed as a cheat for taking advantage of the Native Americans, as well as a fraud, who falsely assumed a position in the church by taking advantage of the people around him.