Category: Charity

Former Gospel for Asia Staff Respond to K.P. Yohannan's Donor Letter: GFA Leaders Never Followed Through

Yesterday, I posted an email that Gospel for Asia donor services is sending to donors about the recent controversies, many of them disclosed on this blog. Today, the former staff have posted a response to the question: Is Diaspora willing to meet with GFA?
The letter from GFA CEO K.P. Yohannan did not address the questions about GFA’s financial dealings but did indicate that the former staff (now around 100) were to blame for lack of face-to-face meetings. This reply provides the other side of the matter.
To the question, is the Diaspora willing to meet? They say:

The short answer is: Yes.
However, we doubt there continues to be a reason to meet.

Diaspora had hoped from the beginning to meet with GFA leadership to address the concerns voiced in our first letter. As we moved forward through this process, we even chose a date with KP for such a meeting (October 2, 2014 and then October 13, 2014), but GFA’s leadership never followed through in actually sitting down to meet. Instead, we were told that Gayle Erwin was heading an investigation into our concerns and, as such, it was now out of KP’s hands and up to the board as to what to do next.

A part of the results of the investigation, according to the Diaspora, was a statement that GFA saw no reason to meet.

Several months passed until Gayle Erwin sent his final report in March stating that our claims were dismissed and that they would no longer be communicating with us. We took that to mean an end of any opportunity for a meeting to take place.

The Diaspora explain their reasoning for commenting publicly and deny that a demand for videotaping was the deal breaker:

We have been told that GFA is telling supporters that the only reason the meeting has not happened is because “Diaspora would not meet without it being videotaped” and GFA has been counseled against doing so by the ECFA. Therefore, they have accused us of not being willing to meet.
We think this is disingenuous, as it gives the impression that GFA did all they could to arrange a meeting and the only thing that led to failed negotiations was our demand that it be videotaped (see Aug 22, 2014). This is simply false. Again, see our Communications History for the whole truth.
The only meeting negotiations between GFA and ourselves were the emails and calls between JD and KP. If one reads, s/he will find that JD asked one time about it being videotaped and KP never even responded to that. Then KP announced the investigation. After that, the negotiations about meeting times simply stopped and KP never spoke directly to JD after that. We would not call that a failure on our part.

I encourage interested readers to examine the communications history and responses to other questions from the former staff group.
The GFA response so far appears to be to claim they want to be transparent but actually not be transparent. They have ignored calls to provide information which would address the many issues which have been raised.  I hope that will change. The silence from GFA is very loud.
 

An Auditor Raises Questions About Gospel for Asia's Promises, Spending and Unaccounted For Donations

I have been raising concerns for weeks about Gospel for Asia’s use of students to carry undeclared cash to India and unreported donations in India.  GFA remains silent and the Evangelical Council for Financial Accountability appears to be disinterested in the evidence submitted. Neither organization responded to my request for comment and information about this post.
On the other hand, I regularly receive emails from former GFA donors and supporters who have taken the information very seriously and have contacted GFA. Thus far, no donor who has contacted me has expressed satisfaction with GFA’s answers. Also, I was recently contacted by Jason Watkins, a former auditor with a Big 4 accounting firm who did a detailed analysis of GFA’s finances using information publicly available from around the world. I will post more of his material in coming days, but for today, I want to post an image depicting Watkins’ analysis of where GFA funds were spent in 2012. See below:
GFA Pie Chart 2012
 
I have posted information which addresses some of these issues, but this image brings 2012 together in one place.*
Jason had this to say about the chart:

The data from the FC-6 Forms for the 4 GFA NGO’s (Gospel For Asia-India, Believers Church, Love India, and Last Hope) were obtained and converted to US dollars. The amounts reported as received from foreign (non-Indian) countries were reconciled to the amounts reported as sent by Gospel For Asia, Inc. (US), Gospel For Asia-Canada, Gospel For Asia-UK, et al. This reconciliation shows that nearly half of the money sent from the west was not reported as received by GFA in India. That money is not accounted for. That is, of the $95 million that was spent by all entities, $45 million was not reported and $50 million was reported in India.
Further, of the foreign $50 million that was reported as received in India, an analysis of the ways that money was spent was performed. This analysis segregated and identified the specific expense categories (water wells, children, women, disaster relief, missionaries, administrative expenses, et al) to show how much was actually spent for the purposes indicated.
The amounts on the pie chart are a sum of the spending categories [called ‘utilised’ on the FC-6] reported in India on the 4 GFA NGO’s FC-6 forms, and then dividing each spending category by the sum of the spending of all GFA entities ($95 million).

The Indian government requires completion of the FC-6 form by registered charities. GFA has completed those forms but, as Watkins points out, the GFA affiliates around the world report sending more funds than the FC-6 forms show as received.
Watkins found reason to question several of GFA’s signature claims:

Gospel For Asia (GFA) solicits and collects over $90 million per year from trusting donors by using the following claims:

A detailed analysis of the actual spending by Gospel For Asia in 2012 reveals

  • 47% of the money ($45 million) is missing and unaccounted for. This was money donated by citizens of the US, Canada, UK, and other western countries. This money has not been recorded as received by the four Indian NGO’s (Gospel For Asia-India, Believers Church, Love India, and Last Hope) according to the FC-6 forms filed with the Indian Ministry of Home Affairs. If there are other NGOs directed by GFA, then GFA should reveal this.

  • 21% of the money ($20 million) was spent on administrative overhead in the west (12%) and administrative overhead in the field (9%).

  • Only 31% went towards charitable expenses, and only 12% actually reached the needy. These are the items that are highly promoted as uses for your donations (water wells, disaster relief, humanitarian outreach, women, children, and missionaries).

  • GFA spent $0 on adult literacy and poverty and yet this is a huge promotional item.

I have asked GFA several times for information regarding these matters. However, GFA told me that the organization would answer no more questions. Regarding the claims of 100% going to the field, I have indicated before that much of the money is on the field, but it is sitting in banks.
Perhaps this is case of bad reporting on the part of GFA. Maybe there is some other explanation. I have acknowledged in the past that I am not an auditor and have been open from the beginning of my research to any information provided by GFA. However, when an experienced auditor examines the publicly available documents and comes away with these findings, I think it is past time for GFA to address these matters.
I have additional analyses to report and plan to do so in the coming days.
 
 
*Sources: Forms FC-6 filed by Gospel For Asia-India, Believers Church, Love India, and Last Hope with Indian Ministry of Home Affairs; Audited Financial Statements of Gospel For Asia, Inc. (TX Corp); Gospel For Asia-Canada, Forms T-3010 filed by Gospel For Asia with Canada Revenue Agency (CRA); Unaudited Financial Statements of Gospel For Asia (Australia) Inc. filed with Australia Charities Regulation Commission (ACNC); Audited Financial Statements of Gospel For Asia (UK) Ltd. filed with the UK Charity Commission; and other online inquiries. Local currencies were converted to USD using exchange rates at oanda.com for the relevant reporting periods.

Phoenix Preacher Raises Red Flags Over Gospel for Asia

Last week, the Phoenix Preacher blog ran a post titled Red Flags over Gospel for Asia. The post describes a GFA donor’s attempt to get answers to questions which have come up in recent weeks. It is good to see donors asking questions but not so good to see the responses. The blog author raised some of the issues I have covered with this assessment.

GFA has felt that Throckmorton has been unfair to them and takes them out of context and so they have chosen to stop communicating with him in any efforts to clarify the concerns he raises. In my phone conversation with the GFA rep, he did give me explanations to some of the concerns raised by Throckmorton. However, some of the explanations seemed to me more like trying to put a positive spin on things rather than giving good solid evidence and rationale. Meanwhile, Throckmorton continues to raise more concerns as he uncovers more and more suspicious looking information. Here is a link to all his GFA articles: /category/gospel-for-asia/

I plead not guilty to this charge. Up to and including the last email from David Carroll, I included the information Carroll sent on behalf of GFA. Here is what he said in his final email:

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.

In his email, Carroll doesn’t accuse me of being unfair or taking him out of context. He said I asked too many questions and for that reason, he was not going to reply. This reason should be of grave concern to donors.

As we now know, GFA did violate the law when they sent groups of students to India each with $4500 in cash in envelopes without declaring the cash to U.S. customs.

The Phoenix Preacher post shows that the questions have only multiplied.

 

Gospel for Asia Reveals Financial Information on Evangelical Council for Financial Accountability Page

In a major departure from past practice, Gospel for Asia changed their ECFA page to include their U.S. financial information. Citing security concerns, GFA has declined to reveal this information on the web, but instead required interested parties to request it by mail. Up until now, the ECFA has allowed charter member GFA to be exempt from usual practice.
ECFA page old
Now the page looks like this:
ECFA page new
 
In a prior post, I noted that GFA sent $58 million to India but the FC-6 forms there show only a little over $6 million received from the U.S. Perhaps, GFA is moving toward more transparency. If so, the organization still has a long way to go to explain this discrepancy, as well as the money exporting to India, and discrepancies in the Bridge of Hope program reporting. Clearly, the organization is raising massive amounts of cash but has yet to explain why so much is sitting in Indian banks.
Given this change, perhaps the ECFA has been in talks with GFA and is privately working to bring GFA into compliance with ECFA guidelines. If this is true, don’t expect ECFA to alert the donating public. If the ECFA and GFA don’t see things the same way, my guess is that GFA will quietly give up their membership with no explanation.

How Much Does it Really Cost to Sponsor a Child with Gospel for Asia?

Yesterday, I pointed out that the expenditure of foreign funds by GFA in the fiscal year ending on March 31, 2014 for the support of children enrolled in the Bridge of Hope program seemed quite low, estimated at around $105 per year. Today, I want to point out that GFA’s request for child sponsorship in India is about one-third of what it is here in the U.S. and that the actual costs are even lower than that.
On the U.S. website, GFA requests $35/month to sponsor a child:

It only takes $35 a month to give a child everything they need—school supplies, a daily meal, medical checkups and more—to attend a Bridge of Hope Center. 100% of your sponsorship is sent to the field to support your child.

However, on the GFA/Believers’ Church Indian website, the cost is INR 800/month or about $12.50 in U.S. dollars per month. That’s quite a discount. The sponsorship page promises:

Your sponsorship of Rs. 800 per month provides [child’s name]:

  • An Education
  • A nutritious meal each day
  • A yearly medical checkup
  • Basic school & hygiene needs

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.
At that rate, Americans who send $35/month to GFA for a child sponsorship could actually support 4 children. Or GFA could keep the excess in a bank and draw interest on the balance as they appear to be doing. As I noted yesterday, GFA spent over $6 million in foreign contributions on Bridge of Hope expenses in FYE 2014 but had in the neighborhood of $25 million designated for “the welfare of children” sitting in a bank drawing interest at the same time.
GFA has to report that interest (the banks do as well) and all four GFA controlled organizations accumulated $4.2 million on the money in savings accounts by the end of FY 2014.
GFA says “100% of your sponsorship is sent to the field to support your child.” Perhaps this statement should be reworded. The money is sent to the field but a lot of it apparently ends up in a bank on the field.
It is past time for GFA to end the silence and address this matter as well as others which have come out in recent weeks.
 
*I have the documents but don’t have permission to publish them.