Tag: Believers’ Church

Gospel for Asia Continues to Raise Money for Flood Relief Without Saying How the Funds Will Get to the Needy

A month ago, I asked Gospel for Asia how they planned to distribute donor funds to flood victims in Kerala, India. In 2017, Gospel for Asia’s comparable organization in India (now called Ayana Charitable Trust) and their ecclesiastical arm (Believer’s Church) lost registration with the Indian government to accept foreign contributions. Thus, these groups can’t accept any of the funds now being raised by K.P. Yohannan from foreign donors. GFA very deliberately is raising these funds on the organization website and on social media. If GFA is giving these funds to another nonprofit in India, why can’t GFA simply inform the donor public about this?

When I asked GFA’s public relations firm, I was told:

GFA has headquarters in Kerala, India. Volunteers are actively rescuing, feeding those affected by flooding and providing other supplies.

However, InChrist Communications did not respond when I asked how those headquarters could accept funds when the registration to accept foreign funds had been revoked.

The later a friend of the blog was told that funds were being sent to Believers’ Church in India. Furthermore, the GFA representative said it could not be guaranteed that the donated funds would actually get to flood victims since GFA has no control over Believers’ Church. Actually, this explanation doesn’t make sense because Believers’ Church cannot legally accept foreign contributions.

Saying One Thing and Doing Another

When Compassion International lost their registration with the Indian government, they left the country. GFA has never addressed their loss of registration, nor why they continue to raise funds to send to India when the organizations they claim to support can’t take them. This is an issue for more than flood support. GFA has continued to raise support for sponsored children, missionaries, and all sorts of activities. GFA is telling the public they are doing something that the Indian government says can’t be done. If GFA is getting donor funds to the intended targets, GFA should disclose how they are doing that.

It is a mystery to me why investigative reporters have not taken up this issue. If there is an easy way around this issue, then why didn’t Compassion International use it? While there may an explanation, given GFA’s size and current legal difficulties, it seems like they should have to be more accountable.

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Image Fair use, GFA Facebook page

Dear Gospel for Asia: How Will Funds Raised for Kerala Flood Victims Get to Them?

Over the past week, the news out of the state of Kerala in India has been devastating. Due to severe flooding, over 400 are dead and 800,000 have been displaced. Sadly, those numbers are expected to climb. Of course, the natural impulse is to help.

Kerala is the home of K.P. Yohannan, Gospel for Asia (now called Ayana Charitable Trust in India), and Believers’ Church. While it is understandable that K.P. has been informing his followers about what is happening there, he is also doing something that raises a question: K.P. is raising foreign donations to send to flood victims. The question is how will those funds get to flood victims?

In 2017, the government of India canceled the registration of Gospel for Asia (Ayana Charitable Trust), Believers’ Church India, and two other affiliated organizations to receive foreign donations. Yohannan is raising money but it isn’t clear how those funds will get to flood victims when the Indian organizations he fronts can’t receive them?

Different Answers from Different Sources

Yesterday via email in response to a GFA press release asking for donations for flood victims, I asked public relations contact Gregg Wooding of InChrist Communications if he could explain how donations will get to flood victims. He replied:

GFA has headquarters in Kerala, India. Volunteers are actively rescuing, feeding those affected by flooding and providing other supplies.

I wrote back to ask how GFA in Kerala could receive those funds since the Indian government had canceled the organization’s FCRA registration. He did not answer.

Earlier in the day a source called GFA in Wills Point, TX on behalf of my blog and asked how American donations could be accepted in India since the FCRA registrations had been canceled. The caller was told that GFA still is able to operate in India, but the license to receive money is with Believers Eastern Church. The GFA representative said that the funds given to GFA are sent to Believers Church. He added that GFA and Believers’ Church are technically and legally different entities. GFA cannot guarantee money given for India disaster relief will be used for that purpose through Believers’ Church because GFA has no legal or ultimate authority over Believers’ Church. Money given to GFA is preferenced by donors for a certain purpose and Believers’ Church in practice uses the money for what it is preferenced for.

Leaving aside the uncertainty that the Believers’ Church might not use the funds as intended, GFA’s answer doesn’t match what the Indian government says. As I will demonstrate below, the registrations for GFA (Ayana Charitable Trust), Believers’ Church, and two other GFA affiliated organizations were canceled in 2017.  The question remains – how will American funds get to flood victims since GFA and Believers’ Church are unable to receive foreign contributions? Maybe there is an answer to this question, but GFA hasn’t provided one that fits with information available to the public.

FCRA – Foreign Contribution Regulation Act

In India, a charity must be registered with the government to receive foreign donations. There are rigorous reporting requirements as specified by the Foreign Contribution Regulation Act (FCRA) and the records are available to the world via the Home Ministry’s website. In fact, those records prompted the early questions about Gospel for Asia’s finances that eventually led to GFA being removed from membership in the Evangelical Council for Financial Accountability.

The FCRA rules are clear that only registered organizations can receive foreign donations (click here for a larger image).

Among other conditions, the rules (Q.2b) state that an organization “must obtain the FCRA registration/prior permission from the Central Government.” In contrast, Q.3i specifies that “individuals or associations who have been prohibited from receiving foreign contributions” cannot receive them.

To determine organizations which have been canceled, one can go to the India’s Home Ministry website and scroll down to the FCRA link.  On that site, there is a link near the bottom left which reads: List of Associations whose registration has been cancelled. If you click through, you will need to select the state of Kerala. Once you do that, you will see Ayana Charitable Trust at the top of the list. Scrolling down you will soon encounter Believers’ Church India and Love India Ministries and Last Hour Ministries.  Here are screen caps of Ayana Charitable Trust (formerly GFA-India), Believers’ Church, Love India Ministries, and Last Hour Ministries on the canceled list).

Since the very organizations which GFA and GFA’s PR representative said will take the money can’t do so, it is a fair and significant question to ask how donations intended for flood victims will get to them.  So far, GFA has not provided a satisfactory answer or provided evidence that the Indian government is wrong. Donors should demand more.

For more on the impact of the revocation of registration to receive foreign funds in India, see this article on Compassion International. When the Indian government canceled their registration to receive foreign donations, they left India. 

 

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Image: with permission Indian Navy (GODL-India) [GODL-India (https://data.gov.in/sites/default/files/Gazette_Notification_OGDL.pdf)], via Wikimedia Commons

8th District Court of Appeals Denies Gospel for Asia’s Petition for Writ of Mandamus

Today, the 8th District Court of Appeals denied the petition from Gospel for Asia a writ of mandamus which would have vacated Judge Timothy Brooks order for sanctions and the appointment of a special master to oversee discovery in the fraud case against GFA.

The denial in full is as follows:

UNITED STATES COURT OF APPEALS
FOR THE EIGHTH CIRCUIT
___________________
No: 18-2322
___________________
In re: Gospel for ASIA, Inc.; Gospel for Asia-International; K.P. Yohannan; Gisela Punnose; Daniel Punnose; David Carroll; Pat Emerick
Petitioners
___________________________________________
Appeal from U.S. District Court for the Western District of Arkansas – Fayetteville
(5:17-cv-05035-TLB)
___________________________________________
JUDGMENT
Before BENTON, KELLY and GRASZ, Circuit Judges.
Petition for writ of mandamus has been considered by the court and is denied. The petitioners’ motion to seal appendix is denied. Mandate shall issue forthwith.

June 26, 2018

This will allow the sanctions from Judge Brooks to go forward and is a victory for the Murphys. If Judge Brooks follows through, then a special master will be appointed with full access to the records of GFA thus allowing discovery to proceed.

Gospel for Asia will have to absorb the cost of the special master and should alert donors to this reality. A federal district judge and now a Court of Appeals (along with the Evangelical Council for Financial Accountability) have taken the position that GFA is not being forthcoming with information.

We may be getting closer to learning if there is any evidence to validate GFA’s claims that they have spent money as donors intend. The plaintiffs contend GFA’s leaders conspired to divert donations from intended causes such mission work or helping the poor to for profit enterprises or other purposes which donors didn’t intend. Now that the Court of Appeals has cleared the way for discovery to proceed, the plaintiffs and eventually the donor public may get to see exactly what GFA has done with millions in donations.

 

ECFA Report: Gospel for Asia Made Inaccurate Statements and Withheld Information

In a 2015 Evangelical Council for Financial Accountability report to Gospel for Asia founder and CEO K.P. Yohannan, ECFA Vice President John C. Van Drunen delineated a devastating list of findings from a lengthy and in depth investigation of Gospel for Asia’s financial practices. The end result of the investigation was the eviction of GFA from the  ECFA. Due to the relevance of the investigation conducted by the ECFA to the current RICO and fraud lawsuit against GFA (Murphy v. GFA), I am highlighting pertinent parts of the report in a series of blog posts. Yesterday, I pointed out that GFA admitted that field partners didn’t track expenditures as precisely as they took donations. Today, I show that ECFA accused GFA of making false statements and withholding information.

Toward the end of the report, Van Drunen made an observation about the process of collecting information.

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.

Although I have been critical of the ECFA in the past, I must credit them in this case. Mr. Van Drunen and his staff deserve credit for persisting through initial deflection and distraction. Also, I am aware that information published here (“unrelated to GFA”) made it possible for the investigation to ask certain questions which might have come up otherwise.

I want to point out that GFA didn’t fully answer all of the questions nor was the ECFA able to verify all claims. Take this issue for instance:

16. Claims of inappropriate use of funds under an Indian tax assessment. ECFA received concerns that an Indian Tax Court case indicates that GFA India misused funds for purposes other than what they were intended. ECFA reviewed this matter for compliance with ECFA Standard 4. On July 27, GFA’s staff indicated that this matter was a false charge that was later remanded and that GFA India was absolved of any wrongdoing in this matter. GFA’s staff was not able to provide any documentation other than reports from field partners on this matter.

This concern was brought to light by my blog post from July 17, 2015. It appears from the court record that GFA was to pay a tax which they probably did. However, that doesn’t change the finding that GFA inappropriately used funds. GFA has never produced a court record absolving them of wrongdoing. They had a chance to do that to ECFA but did not do so.

GFA and Accountability: A Pattern

As Van Drunen’s reaction demonstrates, Judge Brooks is not the first observer to express frustration with GFA’s answers to questions about accountability. In one Court order, Brooks expressed his frustration with GFA’s response to discovery requests, writing at the time:

I feel like when I read the defendants’ answers and when I read their response that it is as if this Court had not already addressed and ruled on some of these same issues at least twice, if not more and, yet, here we are again.

Eventually, GFA’s delays led Brooks to sanction GFA and signal his intention to appoint an attorney (special master) to oversee discovery.  Given the history, going back before Murphy v. GFA, oversight seems like a good idea.

 

In 2015, Gospel for Asia Privately Feared Investigation of How Donor Funds Were Spent

This post is the second in a series covering a February hearing in Murphy v. Gospel for Asia. Former donors, Garland and Phyllis Murphy are suing the leaders of Gospel for Asia in federal court claiming that GFA did not use donor funds as donors intended. Recently, the transcript of the hearing became available. If you are a GFA donor or are thinking about being one, you should read it. It is available via this link with commentary in my first post on the topic. This post discloses the concerns GFA leaders had about being investigated even as they were telling the public they were no problems.

One of the bombshell revelations in the February hearing is the disclosure of an email from David Carroll to K.P. Yohannan which suggests that both men may have misled GFA staff members in May 2015. The Murphys’ attorney Mark Stanley read the email into the record. According to Stanley, in May 2015 then GFA COO David Carroll wrote to GFA founder K.P. Yohannan about his concerns over financial reports and truthfulness. From page 64 to page 68 of the transcript, attorney Stanley cited the email with his comments interspersed throughout. David Carroll’s words are in quotes. I have reproduced Stanley’s testimony below.

Click this link to read David Carroll’s email to K.P. Yohannan without attorney comment

MR. STANLEY: What’s really interesting to me also, if I might just take one second and read pretty much one of the key documents in the case. This is an e-mail from Reverend Carroll, David Carroll, to K. P. Yohannan, and I think it’s really important because it really will put it back into perspective what’s going on: “Sir, I need to share with you where I am over this situation.” I’m right here. “I will try to summarize for brevity sake. We have a saying in our country: The numbers don’t lie. The published FC-6 reports” — which they rely on quite a bit in their answers, if you recall — “show westerners that we have either sent money to the field raised for National Ministries and Bridge of Hope to fund the hospital and the corpus fund, or our FC-6 filings are filed wrong. Either way, this is a huge problem. It appears to those reading these that we might have been dishonest to the donors (fraud), or been dishonest to the Indian government, (a PR nightmare at least). Sister Siny’s report below will, in my opinion, do little to satisfy those who are printing out and analyzing our FC-6 reports. I am sorry for not expressing more confidence than this. I think we may have used money raised for National Ministries and Bridge of Hope for the hospital,” [Stanley remarks] which they told us did not happen.

“I think that India feels that we raise money and send it” –[Stanley remarks] by the way, Mr. Mowrey said that in a prior hearing, that none of the money went to the hospital. “I think that India feels that we raised money and sent it to them and they can legally use it any way they deem fit. I hope that I am wrong, but I am doubtful.” [Stanley remarks] This doesn’t sound like someone who has already got accountability, knowing how they spent the money.

“I also don’t think that it is an intentional wrong, but if I am correct, it is a huge wrong. We’ve spoken at hundreds of churches with tears asking for the National Ministries and Bridge of Hope support, and the FC-6 that is public says that we sent much of that money for the hospital and the reserve corpus funds.” Next page.

MR. MOWREY: Could he read the rest of that letter, your Honor?
MR. STANLEY: I am.
MR. MOWREY: Okay. Good.
MR. STANLEY: “It doesn’t matter that we have now moved the money out of the corpus fund” — [Stanley remarks] this is now after the ECFA thing — “because of public FC-6 reports” — I’m sorry. It’s backwards. Sorry. That’s not right, either. That’s right.
“It doesn’t matter that we have now moved the money out of the corpus fund because according to the public FC-6 reports, we have been building them up for years. Moving the money only serves to confirm the feelings of guilt to outsiders.”

Again, they have not been spending the money. They have been building up the corpus funds for years. “I think the only way for us to handle the inquiries raised by Bruce and others is to refer them to our Indian office. Mr. Throckmorton” — that’s the blogger — “(unless a miracle happens) will get this information and may even begin an investigation of us. We can say all we want that we don’t have anything to do with the Believers Church or the field and that you are only the spiritual head of the church and that finances are handled by others but you, but as a practical matter, that will not hold up. Can the field find a way out of this situation? I too am very nervous.”

“I have always believed in total accountability of the field, yet the FC-6 reports provide numbers that, as a former auditor, I cannot just explain away with a simple explanation. I, and the world, will need numerical proof now, and I do not have the ability to get it from the USA end. Only the field can explain it, and I am in the hot seat in this crisis and I feel a lot of pressure.”
[Stanley remarks] I would point out, Judge, this was in 2015, May of 2015, almost three years ago. You pointed out that our discovery was served in August. ECFA asked them for this information in May of 2015. They’ve had three years to compile this information, and they just don’t have it because it doesn’t exist. Nobody ever tracked the designations because they were simply spent out on the — once they were sent to the field, they were done with it. There was no accountability. It goes on to say, “If I say, well, it is not my problem, it’s a field problem, it’s as good as saying we are guilty of misappropriation,” [Stanley remarks] which is true. If I say “The FC-6 reports are filed inaccurately on purpose, due to the hostile environments we work in, it gets the field in trouble and turns the attention to them. I get the feeling that, although we are not financially dishonest, we are financially reckless. The stockpiling of money in the RBC — [Stanley remarks] Royal Bank of India account — “and then the hurried transferring of it to the field, the Hong Kong account, et cetera. Sir, may I please have my name taken off of the RBC account as soon as possible?”

First, let me say that a miracle didn’t happen, if you know what I mean.

David Carroll expressed anxiety about accountability in this email. He acknowledged that either donor funds were diverted from Bridge of Hope and National Ministries to the Believers’ Church Medical Center or the reports were filed incorrectly with the Indian government. There seems to be little doubt that the funds were used for the hospital as I first reported in May 2015. Carroll was fearful that Bruce Morrison and/or I would launch an investigation into the obvious discrepancies. He was right about that. In response to us, he refused to answer any questions and denied any problems.

Furthermore, in a telling admission, Carroll said to Yohannan:

We can say all we want that we don’t have anything to do with the Believers Church or the field and that you are only the spiritual head of the church and that finances are handled by others but you, but as a practical matter, that will not hold up.

GFA leaders told ECFA that they had no control over Believers Church. See yesterday’s post for a run down of what GFA told ECFA about that. In addition, K.P. Yohannan told his Texas staff in May 2015 that he didn’t sit on any boards and had no authority in India. David Carroll was sitting right beside him. This email suggests that he knew it wasn’t accurate when Yohannan said it.

Publicly, GFA said they were operating in accord with the law, ECFA standards, and best practices. However, behind the scenes we now learn that there was worry, pressure, and a more candid assessment of the situation even as the confident and sunny messages were being disseminated to the staff and to the public. I wonder if they knew all along that it was illegal to send cash into India through student backpacks, thus exposing college students to criminal charges.

What should we believe now?