Believers Church – Page 19 – Warren Throckmorton

Gospel for Asia and Bridge of Hope Funding: Who is Right – David Carroll or K.P. Yohannan?

In today’s World magazine article on Gospel for Asia, COO David Carroll made the following claims about program spending.

Carroll offered statistics, including that GFA’s field partners in India and elsewhere in southern Asia support some 14,000 national missionaries at a cost of approximately $30 million a year. He added that the ministry provides for 78,000 children through GFA’s “Bridge of Hope” program, which requires another $33 million a year, and constructs some 1,200 new churches a year at a cost of another $15 million annually.

Bridge of Hope
I want to focus on the Bridge of Hope claim. Carroll’s claim is consistent with what Gospel for Asia asks donors to give in order to sponsor a child ($35/month). However, in the past, GFA founder and CEO K.P. Yohannan has claimed it takes much less per child. In 2010, according to a New India Express article which cited Yohannan, the program required 30 crore (at the time equal to about $6.5 million USD) to provide for 60,000 children.

At present the Church spends Rs 30 crore annually for the education and uplift of 60,000 children through 525 centres. The Bridge of Hope project of the Believers Church provides free education, health care, nutritious food and school supplies for underprivileged children, irrespective of caste or creed.

This works out to $9/child/month. At the time, GFA was asking for $28/child/month in order to sponsor a child.
Then again in a 2012 interview on Surya television, Yohannan said it cost almost 40 crore (about $7.1 million USD) to care for 60,000 children. Yohannan said:

As for Believers’ Church and Cheruvally estate, donors specifically (1:18) have instructed us to establish an income producing entity (1:23), in the future for you to continue your work. Let me ask you, we spend almost 40 crore rupees to take care of 60,000 children – where does this money come from? Can we campaign to raise money all the time? We have to produce our income (1:43), that is what this is for, for that only.

Using the estimated exchange rates in 2012, as described by GFA and Believers’ Church leader Yohannan, the per month per child spending works out to just under $10/month. In June 2012, GFA was asking $35/month in order to support a child, the same as the current cost to a donor.
According to the public reports of spending in India (FC-6 forms), GFA spent $6.2 million USD on the “welfare of children” in the Indian fiscal year ending March 31, 2014. That works out to about 105/child/year or just under $9/child/month.
I have seen two budgets for Bridge of Hope centers in India, each for a different region of the country. I wrote about one budget earlier this year:

I have also seen GFA budget documents which tell a more surprising story.* The actual cost during fiscal year ending 2014 to support one child in a GFA Bridge of Hope center in India was just under INR 500 or around $8.20 per month per child. This paid for the administration of the program, food purchases, and all child services. In fact, the actual items given to each child (school supplies, clothes, hygiene supplies and gifts) only cost INR 140 per child or $2.20 per month.

In another region of the country, the per child expense was even less — 300 rupees per child per month, or just under $5 USD/child/month. In some areas of the country, children attend free public education and so the costs are less.

Even though this is dramatically less than what David Carroll told World magazine, it is closer to what K.P. Yohannan told Indian media.
A review of receipts for 2012 reveals that donors don’t contribute anywhere close to $33 million for Bridge of Hope related expenses.
Given GFA’s track record regarding public claims, it is reasonable to question what David Carroll told World. What would help is if GFA released some evidence for their claims. Show us the budgets, audited statements, etc. The ECFA said in the investigation report that many of GFA’s intial disclosures were not accurate and that they had to get necessary information from other sources, when the information should have come from GFA.
One analysis by former auditor Jason Watkins found that only 12% of funds given for Bridge of Hope was used for the program. With the discrepancies between what David Carroll and K.P. Yohannan told different public audiences, it is important for GFA to provide evidence and an explanation. With the budget figures and public reports in India, it even more important for donors to get answers about where those funds are going.

World Magazine on the Release of the ECFA Gospel for Asia Investigation Report

World’s Bill McCleery has an article today on the Evangelical Council for Financial Accountability’s Gospel for Asia investigation report released to me and the GFA Diaspora last week.
GFA COO David Carroll sounds more contrite than ever in this piece saying GFA leaders “owned” their mistakes and are sad and sorry that they “breached the confidence of our donors.” This is a long way from May 7 of this year when Carroll told me:

No, Gospel for Asia has not violated the law.

When you first contacted us, I mentioned that we would not be able to respond to every question you put before us. Now, with the increased volume and frequency of your questions, it has become clear that this back and forth has become a distraction from our mission work. For this reason, this will be my final response. We understand that you will continue to explore issues around Gospel for Asia and continue to be fed accusations from former employees, and we accept that.

We continue to remain accountable to all applicable laws and regulations, to the Evangelical Council for Financial Accountability and to independent auditors.

As he should be, Carroll is sad and sorry about the donors, but I still wonder when GFA is going to make a sincere effort to deal with the GFA Diaspora and other former staff.

As in previous reports, K.P. Yohannan is missing in action. No comment from him.

At the end of the article, Carroll promises to do better but he doesn’t explain why we should listen to him now. GFA touted their relationship with ECFA and their financial integrity while they were violating ECFA standards and telling people they were fine.

Some others aspects of the World article will be reviewed in a separate post (e.g., Bridge of Hope).

ECFA Report: Gospel for Asia Has Yet to Answer the $259 Million Question

The report of the Evangelical Council for Financial Accountability’s investigation of Gospel for Asia contains some amazing facts. One fact contained in point 2 of the ECFA report is the disclosure of the massive amounts of donor money just sitting in foreign banks. The ECFA, apparently reading my May 22 blog post, wrote:

2. Excessive cash balances held in partner field accounts. Allegations were made that GFA had upwards of $150 million in partner field accounts, far more than necessary to provide appropriate operating reserves. During our visit on June 3, ECFA was informed that GFA field partner cash reserves were approximately $7 million. After ECFA requested detailed documentation of cash balances held by foreign field offices, on June 29, we discovered that GFA’s field partners had $259,437,098 on hand at March 31, 2014 and approximately $186 million in June 2015.
ECFA staff questioned the appropriateness of the high levels of cash being held in partner field accounts. We were told that GFA partners felt it was important to maintain the high balances in case the Indian government decided to block funds being transferred into the country.
The source of the balances was primarily from donor-restricted gifts to GFA, often raised in response to gift solicitations that communicated urgent field needs (see #4 below). ECFA staff expressed concern that the high reserves may not comply with ECFA Standards 4 and 7.1. Subsequent to our conversation on this matter on July 27, GFA provided ECFA with a plan to reduce partner field account reserves to $72 Million, and then amended the plan on August 27 to reduce reserves down to $11 Million. Again, GFA staff disclaimed that GFA exercises any control over field partners (see #10 below).
In our meeting on July 1, ECFA staff asked you what the GFA board would think if they knew of the high balances in partner field accounts. You indicated that neither the board nor you were aware of the magnitude of the balances. You responded, “They would be as surprised as I am.” Subsequently, the GFA board was notified, during their July 13 board meeting, of the balances held by field partners.

As of the end of the 2014 Indian fiscal year (March 31), GFA had a quarter of a billion dollars parked in Indian banks. Over that year, GFA had added $101 million to the $158 million I discovered. For years, GFA has been telling donors about the urgent needs of the homeless and hungry and they have been sitting on donor funds designated to meet those needs. This is scandalous.
If GFA in the United States really didn’t know, they should have fired Believers’ Church and GFA-India as partners. But then on second thought, that might have been awkward since K.P. Yohannan is the CEO of GFA and the Metropolitan and Managing Trustee for Believers’ Church and the related entities.
In his reply to the ECFA, Yohannan said plans have been made to deal with massive balances. However, there is reason to require proof. GFA initially told ECFA that the balance was $7 million. GFA told staff the same thing in a May 14 staff meeting. Here is what Yohannan said in reply to ECFA.

Yohannan wants the public to believe that Believers’ Church, Gospel for Asia – India, Love India Ministries and Last Hour Ministry are completely independent and unrelated field partners. Yohannan told the ECFA he didn’t know how much money was in those accounts.
However, somehow, GFA convinced the field partners to completely shift their operating philosophy and commit to use nearly all of those funds, leaving only $11 million in reserve (what about the corpus fund?). Yohannan wants the public to believe that he exercised no authority in the matter.
Here’s the $259 million dollar question: Which K.P. Yohannan do we believe? Do we believe the Metropolitan Bishop who signed his name to the Believers’ Church Constitution, or the GFA CEO who told ECFA he didn’t know how much money his Indian organizations had squirreled away?
According to the Believers’ Church Constitution, Yohannan is the ultimate and final authority in all matters relating to Believers’ Church and their trusts. Assets cannot be moved without his approval.
This is a serious matter. For years, donors thought their funds were going to specific needs in India. Now we know much of the money wasn’t going to those needs but rather to interest bearing accounts. If I was a donor, I would want my money back.
Compounding the problem is the incredible claim from K.P. Yohannan that he didn’t know how those organizations were stewarding the funds. How could he not know? He runs those organizations. According to the church Constitution, he is the final authority. I don’t see how Yohannan can have it both ways. Instead of a vague apology, GFA needs to come up with a response that addresses the discrepancies delineated here.

And then review what the Believers’ Church Constitution says about the Metropolitan’s role regarding property and funds. If Yohannan doesn’t know how much money Believers’ Church, Gospel for Asia – India and the other trusts have, then who does? He is the Managing Trustee and the one who nominates the other trustees.

Gospel for Asia Places Apology Ad in December Christianity Today

This sounds a little more contrite than the letter to Calvary Chapel pastors but like that one, this letter is light on substance. A friend informed me that this ad was on page 59 of December’s Christianity Today.

As I demonstrated yesterday, the ECFA did not affirm that all funds were accounted for. Regarding missing funds, this is all the ECFA wrote in their report of the investigation of GFA:

15. Alleged missing funds according to Indian FC6 forms. ECFA received allegations that a significant amount of funds were missing based on attempts to reconcile GFA’s audited financial statements and field partner’s Indian FC6 forms. ECFA reviewed this matter to determine compliance with ECFA Standard 4. On July 20, GFA staff provided ECFA with a reconciliation of these amounts, which reflected a transfer of $29,300,000 to a GFA India account in Hong Kong. GFA staff reported that this transfer was not required to be reported on Indian FC6 forms and that this amount along with fiscal year timing differences led to the allegations of significant missing funds.

ECFA did not describe any review of Indian law nor did ECFA review more than one year. Over 8 years, there is an estimated $128 million unaccounted for. The ECFA did not review this claim and so it is false for Yohannan to tell CT readers that the ECFA cleared them on this allegation.
A big problem with this letter is that Yohannan is now telling people that they are learning and improving when for years, they claimed to be acting with the highest financial integrity. Since for years GFA has claimed to be doing the very thing they now claim they are starting to do, why should they be believed now?
Here’s what ECFA had to say about GFA’s declarations:

Finally, we feel compelled to observe our concern, in general, about the following in addition to the above ECFA compliance-related issues:
Certain information provided to ECFA by GFA that was crucial to our review was, at least initially, inaccurate.
Our review process has covered nearly four months. Certain pertinent information about the compliance issues was not revealed to ECFA by GFA until late in the review process.
We have learned significant information from sources unrelated to GFA that we should have learned directly from GFA.

According to the ECFA, the way GFA leaders brought forth information did not inspire confidence.

Gospel for Asia Pulls More Endorsements from Website

Yesterday, Gospel for Asia linked to a list of ministry leaders who endorsed GFA’s work. Today, that link is missing and the endorsements have been pulled from the page.
The page yesterday looked like this:

Today, it looks like this:

All endorsements are missing and the link to the page is missing.
Recently George Verwer told me that he continued to support GFA and so this action may not reflect the feelings of all endorsers. For whatever reason, GFA has removed the information and a prominent link to the modified page
UPDATE: The page may have just been moved rather than deleted. It can be viewed here now. The church endorsements page contained mostly pastors at one time. See this 2014 page, and then this one in May, 2015. Note how many original endorsers are now missing.