Category: Warren Throckmorton

In 2014, I asked several historian colleagues to opine about what the public should know about Thanksgiving. Five years later, they are still good words to us. The series will run through at least Thanksgiving Day. Today, Jared Burkholder briefly discusses the political aspects of the first thanksgiving.
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Jared S. Burkholder is Associate Professor of History and Chair of the Department of History and Political Science at Grace College, Winona Lake, Indiana. He co-edited The Activist Impulse: Essays on the Intersection of Anabaptism and Evangelicalism (Wipf and Stock, 2012) and Becoming Grace: Seventy-Five Years on the Landscape of Christian Higher Education in America (BMH Books, 2015).

It is good to remember that the “First Thanksgiving” probably had more to do with politics than fellowship, especially if seen through native eyes. Although we might be tempted to think of New England’s native residents as falling into categories of either “friendly” or “hostile” depending on how they got along with Europeans, Indians were, like most of us, intent on protecting their assets and gaining advantages. Treating foreign peoples, including Europeans, as either friends or foes was based on strategic self-interest.

Constructing their settlement at Patuxet (Plymouth) in 1620, the pilgrims had thrust themselves into the middle of a complex system of tense rivalries and alliances among various Indian nations. The Wampanoag, which had been devastated by sickness as a result of earlier contact with Europeans, likely saw their interaction with the pilgrims as an opportunity to garner allies that could help defend against the neighboring Narragansett, who had escaped the plague of 1616 and were powerful enemies. Even Tisquantum (“Squanto”) was playing politics, as Governor Bradford admitted, likely attempting to leverage relationships for his own purposes. Thus, the first thanksgiving was not so much a Sunday afternoon potluck of food and good feelings, but rather an opportunity for testing boundaries and political posturing.

Want a good read on the political angles of the “First Thanksgiving”? See this engaging Smithsonian article, Native Intelligence.

I echo Jared’s recommendation of the Smithsonian article. It paints a substantially different portrait of the first Thanksgiving as a kind of standoff with benefits. From the article:

By fall the settlers’ situation was secure enough that they held a feast of thanksgiving. Massasoit showed up with “some ninety men,” Winslow later recalled, most of them with weapons. The Pilgrim militia responded by marching around and firing their guns in the air in a manner intended to convey menace. Gratified, both sides sat down, ate a lot of food and complained about the Narragansett. Ecce Thanksgiving.

Here’s hoping your Thanksgiving is less tense.

For all articles in this series, click Thanksgiving 2019.

I don’t know any other way to describe the report written by Sally Wagenmaker about the financial and governance practices of Harvest Bible Chapel during the tenure of former pastor James MacDonald.

MacDonald recently defended himself against the church action of declaring him disqualified as a pastor.  He may have to write another Facebook post or ten with asbestos gloves to handle the fire in this report.

If interested in a blistering report about a megachurch in disarray, you must read it for yourself. Here are some spicy appetizers to help you decide:

Based on our law firm’s review of available information, we determined that a massive corporate governance failure apparently developed over several years at HBC, primarily due to the following factors:
• MacDonald’s powerful and subversive leadership style;
• His development of an inner-circle leadership group through which he could control HBC;
• His marginalization of broader leadership, particularly the former HBC Elders; and
• His other aggressive tactics that thwarted healthy nonprofit governance.
Directly resulting from such problems, MacDonald appears to have extensively misused HBC’s financial resources for improper financial benefit.

MacDonald’s strong and persuasive role as authoritative senior pastor, along with his close inner circle, insulation from proper accountability mechanisms, and key changes to the church’s operational structures, resulted in a highly problematic culture. Policies, formal and informal, were put into place to reinforce this unhealthy power structure.

We were provided with extensive salary information for MacDonald and the HBC Compensation Committee’s year-end meeting minutes, reflecting summary approval for executive compensation, housing, deferred compensation, and the housing allowance for MacDonald. The Committee unanimously approved an overall 2015 compensation amount
of $1,240,000, a 2016 compensation amount of $1,370,000, and a 2017 compensation amount of $1,387,500. For year-end 2017, we provided with a “Memorandum of Understanding and Documentation” dated December 19, 2017, reciting “commitments and pledges given in good faith [that] represent a contractual and covenant commitment” to MacDonald, plus a statement that “Walk in the Word and the respective assets are a bible teaching ministry of Dr. MacDonald.” For year-end 2018, the minutes of the “Elder Executive Committee Compensation Committee,” reflecting a total compensation package of $1,270,000 for 2019.

In a word, this is obscene.

Within this context, a leader who receives a tangible personal benefit as a result of a decision affecting the church’s operations or assets has an inherent conflict of interest that must be fully addressed through disinterested, independent leadership decision-making. Based on our legal evaluation, MacDonald seems to have acted in his own personal interests – reaping significant personal financial benefits, avoiding accountability to any governing board, and with heavy-fisted exclusionary leadership. His close inner circle of HBC leaders helped him to do so and without the important accountability measures needed for effective nonprofit ministry governance.

Although I am not an attorney, I would be worried about my legal liability were I formerly involved in leadership at HBC.

UPDATE: James MacDonald responds:

James MacDonald responds to Harvest's release of the legal & financial review. pic.twitter.com/OR8Xx1H6Zq

— Jessica (@JFHockett) November 22, 2019

In CEO and founder K.P. Yohannan’s recent “exclusive personal response” to the fraud lawsuit settlement involving Gospel for Asia, Yohannan traces GFA’s problems to a 2015 “confidential letter from a financial standards association we were part of, and of which we were a charter member.” That letter was from the Evangelical Council for Financial Accountability and outlined 17 potential violations of ECFA financial standards. In October 2015, ECFA evicted GFA from membership. To help donors understand the nature of the concerns ECFA had about GFA, I am posting the concerns one at a time with commentary. You can read all of the posts by clicking this link.

Read the entire ECFA letter on GFA’s compliance issues here.

From that letter, here is the eighth compliance issue:

8. Use of funds restricted for the field for other purposes.

On June 3, ECFA discussed GFA’s claim that 100 percent of field funds are sent and used in the field. GFA staff confirmed that this was accurate. On August 24, ECFA was informed that GFA India made a gift to GFA of $19,778,613 in 2013 to complete GFA’s new office. On August 27, GFA’s staff confirmed that the funds relating to this donation were originally received by GFA as gifts restricted for the field and GFA transferred to field partners to fulfill donor restrictions.

Two important issues are raised:
A. Reallocating gifts donated for field purposes and using them to pay for headquarters construction appears to be a violation of ECFA’s Standards 7.2. GFA staff stated in a recorded GFA staff meeting that you approached the field partner and explained that GFA could borrow the funds in the U.S., at less than desirable terms, for the headquarters construction. However, a gift from the field partner, in lieu of GFA borrowing the funds, would allow GFA to complete the new headquarters and thereby save interest. Therefore, GFA would be able to send more money to the field in future years.

ECFA believes that the potential savings resulting from the GFA India gift is an inadequate basis to reallocate gifts donated for field purposes.

B. Reallocating gifts donated for field purposes contradicts GFA’s claim that 100 percent of funds are sent to the field. In fact, a significant amount of donations restricted for the field made a circuitous trip back to GFA and were used for the headquarters construction, as though they had never gone to the field. This appears to be a violation of Standard 7.1.

In a GFA staff meeting, GFA indicated the field partner took out a loan to cover the use of the $19,778,613 gift and GFA staff confirmed on August 27 that India-generated income was used to repay the loan. Our review of the board minutes did not indicate the GFA board had approved, or even been notified, of the $19,778,613 reallocation of donor-restricted gifts.

The lawsuit settlement between Garland and Phyliss Murphy and GFA included this agreement:

The Parties also mutually stipulate that all donations designated for use in the field were ultimately sent to the field.

Some, including GFA in their promotional material, have portrayed this as an admission that they did no wrong with donated funds. However, this is not the case. GFA did use donor funds in an elaborate scheme to help fund their corporate headquarters in Wills Point, TX. The donations were solicited to help needy people in India and were originally sent to “the field” but then sent back from “the field” to GFA in Texas. The ECFA letter outlines the circuitous route of those funds.

Originally, GFA leaders told staff that an anonymous donors gave the $20-million to complete the construction of the Wills Point headquarters. Then, in a staff meeting (that I first revealed on this blog), Yohannan and David Carroll disclosed to the staff that a field partner under the authority of Believers’ Church gave the money to GFA in the U.S. In that staff meeting, the staff were not told that the funds were originally given by donors.

GFA was so worried about the truth coming out about this point in the ECFA letter that they threatened to sue my former blog host, Patheos, to remove the staff meeting audio.  GFA is a nonprofit organization which requires a certain transparency. They claim to maintain financial integrity but threatened to sue to attempt to cover up aspects of their financing concerning their headquarters.

Thus, one of the key reasons GFA lost their membership in ECFA was reallocating field funds back to headquarters. So the funds were sent to the fields, but they didn’t stay there. If the Murphy suit had gone to trial, there is no doubt in my mind that the Wills Point headquarters transaction would have been a central component of the plaintiffs case.

Next: GFA’s financial statements presentation of restricted funds.

In CEO and founder K.P. Yohannan’s recent “exclusive personal response” to the fraud lawsuit settlement involving Gospel for Asia, Yohannan traces GFA’s problems to a 2015 “confidential letter from a financial standards association we were part of, and of which we were a charter member.” That letter was from the Evangelical Council for Financial Accountability and outlined 17 potential violations of ECFA financial standards. In October 2015, ECFA evicted GFA from membership. To help donors understand the nature of the concerns ECFA had about GFA, I am posting the concerns one at a time with commentary. You can read all of the posts by clicking this link.

Read the entire ECFA letter on GFA’s compliance issues here.

From that letter, here is the seventh compliance issue:

7. GFA’s financial statements do not appropriately report transactions with foreign partners.

During our review on June 3, GFA staff indicated that funds transferred to GFA India were actually transferred to a number of related entities instead of the single entity reflected in the 2013 audited financial statements. Additionally, on August 24 we learned that GFA received a $19,778,613 donation from GFA India, which was classified as a related party elsewhere on the 2013 audited financial statements (also see #8 below).

On August 27, GFA staff confirmed that this donation was neither disclosed in the footnotes of the 2013 financial statements as a related-party transaction nor to the GFA board of directors. This inconsistency within the financial statements and lack of disclosure to the GFA board of directors about a significant related-party transaction appears to violate ECFA Standards 2, 3, and 6. On July 20, ECFA was informed that GFA engaged a new audit firm and they are in the process of reviewing related-party transactions.

This is one of several problems related to the nearly $20-million in donations which was sent to “the field” but then sent back to Wills Point, TX to complete the GFA headquarters complex. Apparently, GFA leadership tried to obscure this transfer of funds from their board and auditors. It has never been made clear to the public whether or not the auditors (Bland Garvey) knew the full circumstances of this transaction.

In the first paragraph, ECFA refers to the fact that GFA sends funds to multiple shell organizations in India. These organizations are incorporated as charities there with Yohannan and his family in control. However, they have no other purpose but to funnel funds to Believers’ Church.

This point is a reminder that GFA has not released audited financial statements to the public since 2013. Actually, they did not release that statement willingly. I requested it and published it in stages to demonstrate the problems with this “related party transaction.”

Next: Use of funds restricted for the field for other purposes.