The secrecy of Southern Baptist officials about their financial scandal at the International Mission Board wasn’t anything unusual. It’s the sort of thing we’ve seen over and over again.
Southern Baptists need to begin seeing the pattern rather than merely viewing these things as isolated cases.
It’s a very common pattern: Without accountability, power corrupts.
Religious organizations are no exception.
The corruption manifests itself, not only in the cover-up of financial wrongdoing but also in the cover-up of clergy sex abuse. For both types of corruption, the root of the problem is a systemic lack of accountability.
That’s the root that Southern Baptists desperately need to remedy.
This blog has posted scores of examples showing the lack of accountability in connection with clergy sex abuse, but let me give you a few more illustrations showing the lack of accountability in the financial context.
North American Mission Board
The president of the North American Mission Board, Bob Reccord, resigned after a state-convention newspaper published an extensive investigative piece about financial mismanagement.
At the time, Mary Kinney Branson was a marketing director for the North American Mission Board, and she’s written a book that provides an insider’s account of the extravagance and financial mismanagement there. Spending God’s Money shows how a powerful religious organization goes wrong when it is unaccountable to the people who fund it and when its leaders lose touch with the higher purpose they purport to serve.
Branson provides details that implicate high Southern Baptist officials and those details are not flattering. For example, Bob Reccord “had a $1 million fund he could use at his discretion, no questions asked and no receipts required.” (Branson at p. 61)
Can you imagine any other organization that would allow an official to spend such sums with so little oversight? According to Branson, that $1 million fund was replenished each year, and in Reccord’s last two years, the fund was reduced to $350,000. In other words, the money didn’t just sit there. He spent it. “No receipts required.”
When Reccord resigned, 41 Southern Baptist leaders signed a letter, praising Reccord and essentially whitewashing his “undisputed misuse of funds.” (Branson at p. 18) One of those signers was Johnny Hunt, who is now the president of the Southern Baptist Convention. Another was evangelist Jay Strack.
According to Branson, after Bob Reccord left the North American Mission Board, “auditors discovered that payments were being made to evangelist Jay Strack ($300,000) and Bob’s mega-pastor Johnny Hunt at Woodstock Baptist Church ($92,000). Final payments were sent after Bob resigned but before he left the building…. There were no written contracts. So nearly half a million dollars was paid to Strack and Hunt through verbal agreements with Bob.” (Branson at p. 113)
A copy of the letter signed by those 41 Southern Baptist men is included in the appendix to Branson’s book. Some of the other prominent Southern Baptist leaders who signed off on it were Jerry Vines, Ronnie Floyd, Jack Graham, David Clippard, Anthony Jordan, Michael Lewis, Jerry Sutton, and Edwin Young.
As Branson explains, Southern Baptist officials effectively concealed this sort of financial mismanagement and wrongdoing by silencing employees. With financial incentives, they induced most departing employees to sign a secrecy pact.
A copy of the standard agreement is included in the book’s appendix; here is the secrecy clause that they persuaded people to sign: “I further agree to make no public or private statements or disclosures concerning my employment or treatment by NAMB or any of its officers, directors, or employees, and not to portray them in a negative or poor light to anyone.” The contract further specifies that, if they break the secrecy pact, then all the “enhanced separation benefits” they received (i.e., the “hush money”) will “become immediately due and payable to the NAMB.”
Baptist Foundation of Arizona
The Baptist Foundation of Arizona was established with the pretense of serving Southern Baptist causes. During its history, it did indeed return about $1.3 million to Baptist causes. But it also “loaned” nearly $140 million to companies owned by three of the Foundation’s directors. In doing so, the Baptist Foundation of Arizona cost thousands of investors their life-savings to the tune of $570 million dollars. It was called “the largest affinity fraud in history.”
Also called “affinity scams,” such frauds target investors who have a similar interest -- in this case, advancing "the Lord's work" through Southern Baptist churches.
Consider just one example: A Baptist Foundation of Arizona subsidiary called Arizona Southern Baptist New Church Ventures "had a stated purpose of financing new Southern Baptist churches in Arizona. Yet it raised most of its money by selling investment products to individuals and invested most of those funds in… an allegedly phony company owned by one-time BFA director Jalma Hunsinger.”
Many of the investors were elderly, and they learned of the investment “opportunity” through their church. They were promised high returns and that some of their money would be used to advance the Gospel. Brochures, distributed in Arizona churches, assured investors that their money “would be as safe as if kept in a bank.”
“We were deceived,” said a woman who invested $35,000 from her son’s Navy death benefit with the Foundation. She described the Foundation’s presentation in her church as being like “the moneychangers in the Temple,” and she complained that Baptist officials were reluctant to discuss the scandal for fear that it “gives God a bad name.”
Baptist General Convention of Texas
The “Valleygate” scandal showed the ugly side of the largest state-wide Baptist convention in the country. It involved $1.3 million in lost and mismanaged church-starting funds. “The investigative team faulted the BGCT Executive Board staff for poor oversight, uneven management, failure to abide by internal guidelines and misplaced trust.”
Because the investigators’ report indicated that some BGCT staff had “allowed the misuse to occur,” it was determined that recovery of the funds would be difficult.
This was a scandal that probably would have never seen the light of day if not for a courageous Southern Baptist pastor named David Montoya, who blogged about it relentlessly as “Spiritual Samurai.” It was a name that suited him because he had the heart of a warrior. But like many whistle-blowers, he was made to pay a heavy price.
Two Rivers Baptist Church in Nashville
Remember when church members at Two Rivers tried to get access to church financial records? They were accused of “causing division” within the church body.
Executive pastor Scott Hutchings gave this Borgian justification for the harshness in how church leaders treated the “renegades”: “There has to be submission and authority.”
Meanwhile, thousands of pages of church financial records were found in a dumpster behind the church. It certainly appeared as though church officials didn’t want people to see those records.
Two Rivers is the home-church for many of the Southern Baptist officials and bureaucrats who do the day-to-day decision-making of the Southern Baptist Convention. Is it any wonder that there are so many Southern Baptist cover-ups when this is the example that is set by the leaders of the leaders’ own church?
These are the sorts of disasters you get when an organization gives its leaders power without also insisting on accountability.
Without accountability, power corrupts.
6/11/09: Appeals court upholds convictions of Arizona Baptist Foundation officials
11/11/10: Libel suit by South Texas church starter dismissed
Monday, December 8, 2008
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I live in Arizona. My in-laws, who are elderly, lost some money in the Baptist Federation problem. It was the same thing - they trusted them with their money because it was a "church outfit" and they wanted their money to do some good for God. I'm glad those Baptist federation crooks got sent to jail.
They better start doing an internal investigation very quickly then.
Anyone who gives money to the SBC is responsible for furthering the corruption. Many will disagree with me and say I am hurting the missionaries. I say hogwash.
We have no mission if we cannot clean up our own house. What? Do we think people in India or Turkey cannot read blogs about the scandals in our denomination?
Mary Kinney's book goes even further to show us that the processes used at the SBC are frivolous with warehouses full of millions of dollars of trinkets, etc they bought for various campaigns and programs which were outdated or never used.
Oh, and book contracts to employees to write materials for royalties which means employees were double dipping.
We have been scammed folks. The SBC is a huge income producer for a few. It has nothing to with Christ. To give them more money would be the moral equivalent to giving whiskey and car keys to teenage boys.
Look around you. Give your money to help a poor single mom who cannot afford to fix her car. If we quit sending these jackels money, they will have to get real jobs.
"We have been scammed folks. The SBC is a huge income producer for a few."
Well said, Lydia. I pray for the day when people in the pews will open their eyes.
I gather that you are saying that they should give directly to the missionaries themselves instead of through the SBC. That might take care of a lot of issues.
Bellevue Baptist in Memphis has been notorious for spending thousands without congregational approval.
Dr Rogers paid $500,000 without congregational approval to keep a previously fired staff member silent. He had an affair with a lady in the church and had stolen some of the Church's money.
Wow! You are going to be in big trouble when you question or criticize Adrian Rogers--but then he was a Southern Baptist so I guess that makes it alright. As much as I loved and admired the man, it is time to let him go on to glory and enjoy Heaven. Its just a little strange to turn on the tv and see his program being broadcast as if he is alive and well.
JMHO so I'm sure there will be plenty of criticism coming.
Anonymous 6:46 PM
Adrian Rogers and Bellevue Baptist maybe the originators of the SBC "keep quiet" money pattern.
The only difference between the SBC mega ministries and Earl P Paulk, Paula White and Juanita Buntyn mega ministries is the amount of money the SBC has to keep problems private.
Bellevue had a gigantic sexual problem but who knows about it today, It is forgotten. Money covers a multitude of sins.
Sung Yung Moon of the Moonies went to prison because the IRS determined that his "special fund", that he had total control over, should be considered as income and he had failed to pay taxes on it. I wonder how the SBC leaders and so many pastors get away with the same thing?
Yes, I am responsible for where I give my money. If it is not used correctly I am just as guilty as anyone by continuing to allow the corruption to continue. It is time to kill some of the "sacred cows" that abound in the SBC churches. Ignorance is no excuse when it comes to stewardship responsibility.
Adrian Rodgers.....really?? Please say it isn't so...
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