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

Prosperity gospel works… for relatives of televangelist Kenneth Copeland

Relatives of televangelist prosper

NEWARK, Texas Here in the gentle hills of north Texas, televangelist Kenneth Copeland has built a religious empire teaching that God wants his followers to prosper.

Over the years, a circle of Copeland’s relatives and friends have done just that, The Associated Press has found. They include the brother-in-law with a lucrative deal to broker Copeland’s television time, the son who acquired church-owned land for his ranching business and saw it more than quadruple in value, and board members who together have been paid hundreds of thousands of dollars for speaking at church events.

Church officials say no one improperly benefits through ties to Copeland’s vast evangelical ministry, which claims more than 600,000 subscribers in 134 countries to its flagship “Believer’s Voice of Victory” magazine. The board of directors signs off on important matters, they say. Yet church bylaws give Copeland veto power over board decisions.

While Copeland insists that his ministry complies with the law, independent tax experts who reviewed information obtained by the AP through interviews, church documents and public records have their doubts. The web of companies and non-profits tied to the televangelist calls the ministry’s integrity into question, they say.

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

“There are far too many relatives here,” said Frances Hill, a University of Miami law professor who specializes in nonprofit tax law. “There’s too much money sloshing around and too much of it sloshing around with people with overlapping affiliations and allegiances by either blood or friendship or just ties over the years. There are red flags all over these relationships.”

Copeland, 71, is a pioneer of the prosperity gospel, which holds that believers are destined to flourish spiritually, physically and financially – and share the wealth with others.

His ministry’s 1,500-acre campus, behind an iron gate a half-hour drive from Forth Worth, is testament to his success. It includes a church, a private airstrip, a hangar for the ministry’s $17.5 million jet and other aircraft, and a $6 million church-owned lakefront mansion.

Already a well-known figure, Copeland has come under greater scrutiny in recent months. He is one target of a Senate Finance Committee investigation into allegations of questionable spending and lax financial accountability at six large televangelist organizations that preach health-and-wealth theology.

All have denied wrongdoing. But Copeland has fought back the hardest, refusing to answer most questions from the inquiry’s architect, Republican Sen. Charles Grassley of Iowa.

Copeland’s church also has invited an Internal Revenue Service audit, which would keep information private, and has launched a sophisticated Web site, Believers Stand United, to “help set the record straight.”

The Senate committee didn’t set out to determine whether Copeland or the others broke the law, although it could provide information to the Internal Revenue Service if something seems flagrantly wrong, a committee aide said. The main goal, Grassley has said, is to figure out whether existing tax laws governing churches are adequate, which could carry sweeping implications for all religious organizations.

The committee could subpoena Copeland if he remains uncooperative. Neither he nor John Copeland, his son and the ministry’s chief executive officer, responded to interview requests.

But Lawrence Swicegood, spokesman for Kenneth Copeland Ministries, said in written responses to questions that no Copeland family members receive improper benefits through their ties to the church.

All revenue from the church’s business interests – including an oil and natural gas company it owns – go into the church, Swicegood said.

He said that Kenneth Copeland has never exercised his veto power over board decisions, a provision meant for emergency use. Even so, Swicegood said, the board is scheduled to meet in August to vote on taking away that ability.
[…]

– Source: Relatives of televangelist prosper, Eric Gorski, Tri-City Herald, USA, July 26, 2008 — Summarized by Religion News Blog