Tax-Exempt Ministries Avoid New Regulation

A three-year investigation into financial improprieties at six Christian ministries whose television preaching bankrolled leaders’ lavish lifestyles has concluded with the formation of an independent commission to look into the lack of accountability by tax-exempt religious groups.

Senator Charles E. Grassley, an Iowa Republican and the ranking member of the Senate Finance Committee, issued a report saying that “self-correction” by churches and religious groups is preferable to legislative or regulatory solutions.

Money, Money, Money…
If anyone teaches false doctrines and does not agree to the sound instruction of our Lord Jesus Christ and to godly teaching, {4} he is conceited and understands nothing. He has an unhealthy interest in controversies and quarrels about words that result in envy, strife, malicious talk, evil suspicions {5} and constant friction between men of corrupt mind, who have been robbed of the truth and who think that godliness is a means to financial gain. {6} But godliness with contentment is great gain. {7} For we brought nothing into the world, and we can take nothing out of it. {8} But if we have food and clothing, we will be content with that. {9} People who want to get rich fall into temptation and a trap and into many foolish and harmful desires that plunge men into ruin and destruction. {10} For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs.
– The Bible, 1 Timothy 6:3-10 NIV

Comments & resources by ReligionNewsBlog.com

But his report found that only two of the six ministries cooperated with his investigation and volunteered to institute reforms. The others continued to hide behind tax laws that allow religious organizations to operate tax-free with little transparency or public accountability — a status that sets them apart from other nonprofit groups and charities that must file detailed annual reports of expenditures to the Internal Revenue Service.

“The challenge is to encourage good governance and best practices,” Senator Grassley said in a statement, “and so preserve confidence in the tax-exempt sector without imposing regulations that inhibit religious freedom or are functionally ineffective.”
[…]

The inquiry began at the request of evangelical Christians who shared their alarm with Senator Grassley about how the six ministries appeared to be using donations from the faithful to buy airplanes, lavish homes and jewelry, and to run profit-making businesses for leaders and their family members.

All six are “prosperity gospel” ministries, which teach that believers will themselves become prosperous by donating generously to the ministry. The preachers flaunt their opulent lifestyles as evidence that their teaching is true.

The two ministries that responded fully to Mr. Grassley’s investigation and indicated they had reformed their practices were Joyce Meyer Ministries and Benny Hinn Ministries.

The four ministries that provided incomplete or no information, according to the Finance Committee investigators, were Kenneth and Gloria Copeland of Kenneth Copeland Ministries; Randy and Paula White of Without Walls International Church; Creflo and Taffi Dollar of World Changers Church International; and Bishop Eddie L. Long of New Birth Missionary Baptist Church. (Bishop Long was recently sued by four young men who accuse him of luring them into sexual relationships. Bishop Long has denied the allegations.)
[…more…]

– Source / Full Story: Tax-Exempt Ministries Avoid New Regulation, Laurie Goodstein, New York Times, Jan. 7, 2011 — Summarized by Religion News Blog

New panel formed to examine issues around church finances

A new commission has been formed to address issues raised in an investigation into the financial operations of six media-based mega-ministries, including two in Georgia.
[…]

The Commission on Accountability and Policy for Religious Organizations will be led by Michael Batts, an expert in board governance, financial reporting and tax compliance for nonprofits.

In an interview Friday, Batts said he hopes solutions can be identified that don’’t involve “burdensome legislation.” I would not say categorically that legislation would be bad, but certainly harsh, adverse or burdensome legislation would not be welcome.” He said solutions could include self-regulation for churches and faith-based nonprofits or improved enforcement.
[…]

Three ministries provided incomplete information. They were Randy and Paula White of Without Walls International Church; Long’s New Birth Missionary Baptist Church/Eddie L. Long Ministries; and Kenneth and Gloria Copeland of Kenneth Copeland Ministries.

World Changers was called the “least cooperative.” To date, the review said, the committee staff has been unable to determine the names of the ministry’s board members or any information regarding compensation. A spokeswoman for Dollar could not be reached for comment.

As a result, information about those churches was gleaned from public sources and current or former officers, directors, key employees, watchdog groups and current and former members. The staff, for a variety of reasons, decided against issuing supoenas. In some cases, informants said they were warned by churches that they would be sued if they violated confidentiality agreements. Some informants would only speak anonymously and some were too frightened to do even that, according to a staff memo to Grassley.

The investigation report issued this week details the ministries’ luxury homes and cars, trips on private jets and expensive gifts, including two Rolls Royces that a third party reported was given to the Dollars as a gift from the church.
[…]

The fact that some of the targeted ministries failed to provide complete or any information to the committee was particularly troublesome, said Riggins Earl, a professor of ethics at Interdenominational Theological Center.

“Something in the culture has obviously gone out of control in terms of a church’s corporate accountability and transparency,” he said.

“I’m all gung ho for church and state separation but I don’t think the church should have the power that Mr. Dollar and Mr. Long want to give themselves.”
[…more…]

– Source / Full Story: New panel formed to examine issues around church finances, Sheila M. Poole, Atlanta Journal-Constitution, Jan. 7, 2011 — Summarized by Religion News Blog

See Also

Grassley Releases Review of Tax Issues Raised by Media-based Ministries
Research resources on Prosperity Teaching

Court: California preacher Frederick Price can sue ABC for defamation

SAN FRANCISCO—A federal appeals court on Tuesday reinstated a televangelist’s defamation lawsuit claiming ABC’s “20/20″ news program used a fictionalized sermon portraying himself as a wealthy braggart out of context.

The original 20/20 report

A trial court judge had earlier tossed out the lawsuit filed by the Rev. Frederick Price, ruling that the video apparently showing the founder of the Crenshaw Christian Center boast about his wealth didn’t leave the audience with the wrong impression of the preacher: Price is wealthy and he does boast, going as far as calling himself a “prophet of prosperity.”

But the problem for ABC is that the clip of Price it aired was actually a sermon on greed in which the preacher slips into the role of a fictional character who is wealthy but unhappy.

“I live in a 25-room mansion,” television viewers saw Price preach. “I have my own $6 million yacht. I have my own private jet, and I have my own helicopter, and I have seven luxury automobiles.”

Because none of that was true but was presented as fact, a unanimous three-judge panel of the 9th U.S. Circuit Court of Appeals ordered the trial court to reconsider the lawsuit and determine whether Price suffered any harm to his reputation because of the clip.

Court records show that Price owns an 8,000 square-foot house worth $4.6 million, drives a Rolls Royce, wears an $8,500 watch and travels the world in a Gulfstream jet owned by the church, which he describes as a $40 million operation.
[…more…]

– Source / Full Story: Court: Calif. preacher can sue ABC for defamation, Paul Elias, Associate Press via the San Jose Mercury News, Aug. 24, 2010 — Summarized by Religion News Blog

Court Reinstates Evangelist’s Defamation Suit Against ABC

Judge R. Gary Klausner had decided that even though Stossel’s broadcast took the words of Frederick K.C. Price out of context the television evangelist was out of luck because the words, while misused, nevertheless were “substantially true.”

A three-member panel at the Ninth Circuit appeals court disagreed today.
[…]

ABC later repeatedly apologized but the evangelist sued in July 2007.

In court, the network argued that Price’s words, while taken out of context, were generally an accurate description of the evangelist’s lifestyle.
[…]

But the Ninth Circuit panel (dominated by two Democrat presidential appointees) determined that Judge Klausner had prematurely ended the suit because Stossel and ABC presented Price’s “statement in a misleading context, thereby changing the viewer’s understanding of the speaker’s words.”
[…more…]

– Source / Full Story: Court Reinstates Evangelist’s Defamation Suit Against ABC, R. Scott Moxley, Orange County Weekly, Aug. 24, 2010 — Summarized by Religion News Blog

Court revives defamation lawsuit vs ABC Network

A federal appeals court on Tuesday revived a defamation lawsuit against Walt Disney Co’s ABC Network and its former news correspondent, John Stossel, finding some claims to be potentially valid.
[…]

An attorney for Price said ABC must now produce editor notes and footage that can shed light on whether the network intentionally broadcast false statements.
[…more…]

– Source / Full Story: Court revives defamation lawsuit vs ABC Network, Reuters, Aug. 24, 2010 — Summarized by Religion News Blog

See Also

Read the Court’s decision
Learn more about Prosperity Teaching (and how the scam works).

Prosperity Gospel does not work for Benny Hinn

The so-called prosperity gospel preached by Benny Hinn does not work for the controversial evangelist.

Hinn has posted a plea for $2 million in donations on his website.

The televangelist says he accumulated the deficit in the past few months because offerings at some international appearances did not cover expenses.

Here’s how the prosperity scam is sold: God wants you to be rich (and/or healthy), but He can not bless you unless you first send money to whichever televangelist or teacher tells you about this scheme.

Such donations are often referred to as “seed-faith offerings” — which is why Benny Hinn is asking you to “sow the best seed you can, as quickly as you can.”

Our advice: If the prosperity gospel works as advertised, folks like Hinn should be sending you and me money so that God can bless him.

We’re not holding our breath. [See also: Hinn and money] [Read more...]

Watchdog: Jesse Duplantis’ ministry is big business

Jesse Duplantis Trinity Foundation, an evangelical watchdog led by Ole Anthony has been investigating evangelist Jesse Duplantis.

Investigator Pete Evans says ‘Donors expect the money they donate to the church to go to the poor and needy. Not to build mansions for the pastor.” Duplantis is building a mansion, owned by the ministry, that has 35-thousand square feet of covered space. [Read more...]

Prosperity gospel faces challenge: frugal savers

Prosperity Gospel Despite the economic downturn, the prosperity gospel remains alive and well. Pastors like Cowan or televangelists like the Rev. Creflo Dollar and the Rev. Kenneth Copeland continue to promise that financial blessings will follow donations to their ministries.

But it faces a challenge from a new austerity gospel, which says God blesses those who work hard, save their money and pay off their debts. [Read more...]

Prosperity Gospel: Did Christianity Cause the Crash?

Prosperity Gospel America’s mainstream religious denominations used to teach the faithful that they would be rewarded in the afterlife. But over the past generation, a different strain of Christian faith has proliferated—one that promises to make believers rich in the here and now.

Known as the prosperity gospel, and claiming tens of millions of adherents, it fosters risk-taking and intense material optimism. It pumped air into the housing bubble. And one year into the worst downturn since the Depression, it’s still going strong.

• In the same issue of The Atlantic: Lead us not into debt: Finance guru Dave Ramsey wins followers with a simple message: find God and lose your credit cards. [Read more...]