DALLAS (ABP) — For some, Tammy Faye Messner's death July 20 stirred fond memories of a joyful Christian TV personality, and for others, painful memories of the sex-and-money scandal that destroyed her former husband's popular Christian television network. Her death also reminds Christians that financial scandals are still very much alive in the church.
In 1989, Jim Bakker was convicted of 24 counts of fraud and conspiracy and sentenced to 45 years in prison (he served five). Messner — known as Tammy Faye Bakker before her remarriage — was not included in the indictment, which accused Jim Bakker of conspiring to defraud partners of his PTL cable TV network out of $158 million.
The story of how Bakker stole from those he led in Christ's name captivated the nation's attention and epitomized a decade of televangelist scandals. Eventually they all faded from the headlines. But, while televangelists are no longer the focus, stories about clergy theft in general have not disappeared.
In fact, 20 percent of American congregations lose money to people entrusted with church finances, according to a 2005 Newsday article.
— Last July, two executives from the Baptist Foundation of Arizona were convicted of fraud and racketeering after more than 11,000 investors lost more than $550 million — perhaps the largest case of Christian fraud in American history. William Crotts and Thomas Grabinski were accused of publishing favorable financial statements to retain investments while they shifted bad assets to “off-the-books” companies to hide the foundation's extensive losses from auditors.
— In Kentucky, Larry Davis pleaded guilty to stealing $730,000 from his now-former congregation, First Baptist Church of Cold Spring. The Cincinnati Enquirer reported that as part of the plea agreement, prosecutors dropped three counts of income-tax evasion and two counts of transferring stolen church money across state lines.
— In Washington, D.C., a watchdog group called Citizens for Responsibility and Ethics recently filed two complaints with the IRS against Living Word Christian Center in Minneapolis and its pastor, Mac Hammond. The second complaint was based on documents obtained by the Minnesota Monitor that claim Hammond bought a plane from the church and then leased it back to the church for almost $900,000 a year.
— And for over a year, the Kansas City Star has been researching First Family Church, a Southern Baptist Church in Overland Park, Kan., and its pastor Jerry Johnston, after former members of the church expressed concerns about the church's financial accountability. The Star reported detailed accounts involving nepotism, broken promises, delayed spending and an unexplained land deal.
The worst cases make headlines. But experts say some instances of misappropriation of church funds occur for reasons other than theft and deception.
Dalen Jackson, associate professor of biblical studies at the Baptist Seminary of Kentucky, said many instances of financial misappropriation are unintentional, due instead to laziness or lack of understanding about tax laws.
Steve Clifford is a financial planner who specializes in clergy tax returns. He said that of the more than 10,000 tax returns he's filed involving clergy, he has found only one misappropriation of funds. And in that case, Clifford said, it was clear the minister was guilty only of being sloppy, not doing wrong.
“Greed is a temptation for anyone but not for most of the pastors I work with,” Clifford said. “Most of them are self-sacrificing.”
Clifford said pastors tend to get in trouble when they focus all their energy on ministering duties. He said the business aspect of managing a church sometimes gets pushed aside because pastors usually don't have formal training in the areas of sales and finance.
“There is a need for more financial education for pastors and church treasurers,” Clifford said.
Bob Baker, pastor of Calvary Baptist Church in Lexington, Ky., said his church has a system of financial checks and balances. Baker said he doesn't want any control of church finances — that's not his area of expertise — so he consults with church staffers hired specifically to deal with areas of finance.
“As pastors, we should set up a financial system where we can be true to God and accountable to members of the congregation,” he said.
Clifford agreed, saying that knowledgeable church members willing to volunteer to help the pastor with financial issues can be helpful, especially in smaller churches that don't have enough money to pay a treasurer.
Gifts are another area where pastors should tread carefully, experts say. Congregations often feel a close connection with their pastors. But when congregants try to express their appreciation to pastors by giving gifts, it can put a pastor in an uncomfortable position.
According to Clifford, tax regulations state that unsolicited gifts from one person to another out of love and affection are non-taxable, non-reportable and non-deductible. But when the value of such gifts becomes a regular or substantial part of the pastor's or any employee's income, then a line has been crossed.
“This is a tough area of ethics to discern,” Clifford said. “It remains an area of subjective judgment with few clearly demarcated lines.”
Gary Fearn, a pastor from Pueblo, Colo., and part-time tax appraiser, said it's often difficult for pastors to turn down gifts because they don't want to offend congregants. But many congregants are just trying to practice Jesus' message to “bear the burden of your brother,” Fearn said.
Don Loomer, pastor of First Baptist Church of Elk Grove, Calif., said he can understand the tension of being presented with a pastoral gift. A congregant once offered him a new car.
“I turned it down,” Loomer said. The “kind of car he was offering was [worth] about as much as the [annual] living standard of the congregation. I didn't want it to be a hindrance to my ministry.”
Fearn said the best way for pastors to increase accountability with their congregations is to increase the financial transparency of the church, since the practice builds trust and credibility.
Most churches could stand to improve that transparency. For instance, Fearn said, board meetings should be more a matter of public record than of secrecy. Inviting guests to board meetings or publishing transcripts of the discussions can help, Fearn said. And quarterly financial statements should be published and broken down into specific terms so everybody knows exactly where the money goes.
Sometimes, even with all precautions, mismanagement happens in churches. And ultimately, say experts like Baker, all cases involving outright corruption have one thing in common — in the end, everyone losses.
“Whenever a pastor falls I'm saddened because it really hurts all of us,” he said.
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