David Carroll's Answers to CBS News and Gospel for Asia Staff

In May, David Carroll and K.P. Yohannan told Gospel for Asia staff the following about smuggling cash to India:

David Carroll: A couple things you should know. We would never endanger students or anyone else, we’ve had pastors carry money, we’ve had staff carry money, we’re always looking for ways to get money into India because the reality is that it’s getting more difficult to do that, and we are looking for other ways that we’re able to do that. But we checked with our auditors before we ever would allow such a practice. We actually called Bland Garvey, they’re our audit firm and said this is what we’re planning to do, this is what we are intending to do, and they told us how we get it receipted they said it’s completely legal, you’re under all limits, you need to get receipts, there need to be receipts here, there need to be receipts there which Lori has receipts from here. The Indian side also account for that money as received. If you were to lose it, they couldn’t receive it, and in that case, we would say it’s lost basically. We would have to tell the auditors we gave it and it didn’t get to the other side and I’m sure they wouldn’t be very happy, but is it receipted on the other side as received, and accounted for? Yes, it is on the other side of the pond.

So, we have stopped that practice, we feel that it put more emotional burden on people than we realized and then we wanted to and so…

KP Yohannan: It is a perception problem also. Like when I go to Burma and Nepal, I carry quite a lot of travelers checks and get into the country and cash it into local currency and I give it and then the border department, they account for that money in the local Burmese currency or wherever I’ve been to so (?). It’s a legal thing, you cannot carry any more than $5000 and not declare it but when you get India, Nepal, Burma, you can cash it, you can burn it, you can eat it, you can throw it away, you can give it, it is a local currency you are giving it and so receipts are accounted in the book are reported to the government (?) and that is an absolute thing because what I am trying to say, it’s not trying to be under the radar, or illegal smuggling money into the country, nothing like that.  

Carroll: We had heard that one explanation you were given was that the tax rate is high, which would indicate that we’re trying to avoid tax on the money and that’s not the case. I’m sorry if that got skewed but that’s not the case. It’s actually reported on the other side legally so we can do everything we’re supposed to do in reporting that money to the Indian government.

Yohannan: But we don’t do that anymore.

In essence Carroll and Yohannan claimed that carrying undeclared cash in groups was legal but GFA stopped it because the practice put too much emotional burden on staff and students.

During last night’s Gospel for Asia segment on CBS 11 News Dallas, Carroll said the practice was stopped as soon as leaders found out it was illegal. In fairness to Carroll, his words were paraphrased by the reporter.

“We have never willfully broken any laws,” said Carroll, adding that taking the cash-filled envelopes into India was an innocent mistake meant only to help the needy in that country. He said the practice was stopped once the group realized it violated federal law.
“We just never knew … we maybe should have done a better job asking,” Carroll told the I-Team.

Compare these words with what Carroll told staff. When and why did they stop sending cash via students to India?
At one point, David Carroll told me flatly that GFA had not broken any laws and then declined to reply to my email requests for information. Perhaps, he should have taken my questions more seriously.
According to the CBS report, the nearly $20 million diversion of funds from India to help build the Wills Point campus was given from the general fund of an Indian group.

Several former members told the I-Team they also disagreed with GFA moving more than $19 million from India to finish paying off the new headquarters near the Kaufman County town of Wills Point.

But Carroll responded by saying the Christian group did nothing wrong because the money came from a general fund that could be used for various purposes, and not just for work “in the mission field” in India.

It was tapped, “I believe, knowing that campus one day probably would return many times in what they’d invested.”

In May, Carroll and Yohannan told staff.

David Carroll: There is, I don’t want to call it a rumor, a story, an inquiry about, what about the $19 million anonymous gift that was given for the campus back a year or so ago? What’s that all about? Did that come from the mission field, from field funds? So I want to explain that gift to you so that you know.
In about April of 2013, as we were building the campus here, we were running pretty critically short on money. We went to a bank at the time, City Bank of Texas, they’re located in Lubbock. Many of you might remember, we were still at the other building and A group of 11 bankers came, talk about a room, 11 bankers and an accountant and John [Beers]. That’s 12 bankers and an accountant. That was a rip-roaring time. Anyway, um, they came interested in our project to loan to it. So we brought them out here, we showed them the whole thing, we explained our vision, and actually we were working toward finalizing that loan, we were at the place of getting terms from them and when we realized the cost of the loan, Brother KP mentioned it to some of the folks in Asia and mentioned that we were not able to do any better than that. We couldn’t, we would loved to have borrowed money from one of the Asian banks cause actually it’s much better terms, it would be much less costly, we weren’t able to do that being a foreign corporation.
And so, what the people in Asia did, and it is a board that is under Believers’ Church umbrella, but Brother KP’s not on that board, it wasn’t his decision. The decision was made by them that since GFA North America had sent so much money to us from undesignated field funds, where needed most funds over the years, and since this campus to us is seen as an international headquarters which will be leadership training, it will be RYPs, which are always fruitful for the field, every time we have an RYP, the field tends to benefit from that. It will save the ministry somewhere between 4 and 5 million dollars a year when we’re at capacity here which is about 350 people. When that happens, we’re going to receive a lot of that extra money back and so they made the decision while we were in that bank loan process, that rather than go with that bank loan, we would like to make an anonymous gift for the campus fund. And they did that.
Was it field funds that should have gone to Nepal for earthquake victims or
K.P. Yohannan: – (Unintelligible)
DC – I was just getting to that.
KP – Sorry
DC – That’s fine. No, it wasn’t. But what they did on the mission field is they actually took a loan from one of their sources to replace that money so they could use it for the purpose it had been designated for there. So in essence, they got our loan. There are several income producing entities in Asia. That’s why partly why we have 35% of our church is self-sustaining, by God’s grace now in Asia. And they felt they could pay that loan off very very quickly. They made that decision to give us that money and they wanted it to be anonymous. And I’m a little sad that it’s not anonymous, but I did want to explain to you where it came from, and the reasons behind it, and so, in their minds it was an investment.
KP – It’s legal.
DC – It’s completely legal, thank you. There’s a board member, board documents as I understand it, I don’t live in Asia, but there’s board documents on the other side. The whole thing was done in complete legality.

Was the nearly $20 million a transfer from Believers’ Church general fund or a loan taken out by BC or a BC affiliate?

Former Auditor: $128 Million of Funds Sent By Donors to Gospel for Asia over Past 8 Years Can't Be Accounted For

Jason Watkins, a former auditor with a Big 4 accounting firm, has constructed an image depicting the findings of his review of information regarding Gospel for Asia’s finances for the last eight years. The image speaks for itself:
GFA Unaccounted Funds
This is an issue I have been raising since June. To date, no explanation has been offered for why the amount reported by GFA as being sent to India isn’t reported in India public documents. Even after nearly 6 months, I am receptive to an explanation from GFA. Thus far, there has been no answer. Obviously, this is a huge red flag and should be addressed by the GFA board and leadership.
Note: The chart above replaced a similar chart in the original post. The captions have been expanded to make the explanation clearer. The figures are the same.

Did Gospel for Asia/Believers' Church Buy Cheruvally Estate With a Bank Loan or Donor Funds?

Recently, a reader in India sent a clip of a 2012 interview of K.P. Yohannan on Surya TV and Indian station. In it, Yohannan responds to questions about why he did not respond to charges that Believers’ Church acquired Cheruvally Estate (a rubber plantation) illegally. He also claims that the funds to purchase the rubber plantation in 2005 came from donors who designated their donations to the church on the condition that the funds would be used to purchase income producing property.
The clip is mostly in Malayalam. I was able to secure translations by four Malayalam speakers and found them to be nearly the same. Notice that K.P. Yohannan uses some English in his replies. A composite translation is below the video with the time in parentheses after the English words he says.

Anil Nambiar: The Believers Church is the owner of Cheruvally estate.
K.P. Yohannan: Correct (.04)
AN: There is a claim that Cheruvally estate is taken from revenue land.
KP (interrupts): Simply saying…
AN: …this is an allegation from A.M. Varghese
KP: If there is any estate in Kerala that is not owned by the government for the people or does not have any questions about a clear title (.22), that is Cheruvally estate. I take the blame because I did not publically challenge such allegations.
AN: Why didn’t you come out and publicly challenge it?
KP: Stupidity, It was our foolishness (.33). Because there was some advice from people who I respect, “Your highness, don’t reply to these things. Do things straightforwardly, and you are doing that, why fear? Let them say whatever they want.” But like how got beaten up in darkness then woke up, and this is how it is now. I admit, this is a mistake we made (.53) that we didn’t respond. Because we have nothing to fear as we have not done anything wrong.
Estate…when I travel from Thiruvalla to Trivandrum along the way there are so many land, institutions belonging to other churches. How much more property owned by Amrita (a Hindu sect led by a lady guru called “Amma: meaning mother) has how much property? Why did they buy these?
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. Funds for this are literally given to us by the donors for such purposes only. See (1:52) people will ask, “your highness, your sadness (1:58), your sorrow (2:00), what is that?”

I have looked through the donor reports for Gospel for Asia going back as far as 2004 and I can’t find anything specifically donated to allow Believers’ Church to purchase income producing property. In fact, in the 2013 audited financial statement, GFA doesn’t even list Believers’ Church as a related party and recipient of cash from GFA. I suppose it is possible Yohannan referred to donations from within India which are not a part of the U.S. audit. There are many questions raised by this interview.
Those questions aside, Yohannan told one story to Anil Nambiar about the purchase of the Cheruvally Estate  and another story on his GFA website. Read what he said there about the acquisition of the plantation:

In addition to generous giving on the part of its members, theese (sic) churches also generate revenue from literature publishing and other activities. When leaders were presented with the opportunity to purchase an operating rubber plantation for only “pennies on the dollar,” they saw a way to open a new income stream for ministry. But there were stipulations on how the purchase would have to be made.

The leadership made the decision with the understanding that financing would not come from church or mission funds,” explained Dr. K.P. Yohannan, who is also president of Gospel for Asia, whose native missionaries serve the Asian church. “Rather, it would have to be taken care of from the profits of the estate.”

With that understanding, and the knowledge that the property was being “dumped” at a very low price (about US $19 million), the leaders voted to go forward.

We made the purchase with a 100 percent bank loan at a very favorable rate,” Dr. Yohannan explained. “And now the loan is being repaid with the profits from the rubber plantation. When it is paid for in six or seven years, all further profits will go directly to fund missions and ministries.”

I gave my full support to the purchase,” Dr. Yohannan added, “because I know that the future of the church in India depends on its ability to take care of itself.

So which is it? Was the plantation purchased with designated donor funds or by means of “a 100 percent bank loan?”
It wouldn’t be far fetched for Believers’ Church to divert funds; an Indian court declared that the church did just that in 2014. But why tell American donors that the plantation was fully purchased with a bank loan? The two different narratives do not inspire confidence or trust.
In this interview, Yohannan discloses that GFA spends around $7 million (40 crore rupees in 2012) on 60,000 Bridge of Hope children. That is about $117/child a year or just shy of $10/month. BoH sponsors in the U.S. send $35/child. Furthermore, if the plantation and other income producing businesses are funding these programs then what is happening to the U.S. donations?

K.P. Yohannan Told Gospel for Asia Staff He Has No Powers as Metropolitan of Believers Church

In the May 14, 2015 staff meeting, Believers’ Church Metropolitan and Gospel for Asia President K.P. Yohannan told staff that he does not sit on any boards or trusts in India and that he had no legal authority. Those declarations came near the end of the meeting. Near the beginning of the meeting, Yohannan set the tone by saying he has no powers as Metropolitan of Believers’ Church. Listen (click the link):
K.P. Yohannan Told Staff He Has No Powers as Metropolitan
Near the end of this short clip (1:20), Yohannan says:

No decision must be made by one individual. For example, I am now the Metropolitan and honestly I have no powers. I am chief among equals. So any decision for the church, faith and practice, ordination is made by the council.

Throughout the meeting, it seemed to be a matter of great importance for GFA leaders to downplay Yohannan’s authority in Believers’ Church. This is puzzling in light of the Believers’ Church Constitution. Click the links the read chapters one and two, and three. See also the segments below to see that Yohannan is the final authority on all matters of faith, practice and administration in the church. He has veto power over his Bishops and their Council.
MetropolitanPowersBC Cons

Gospel for Asia, Believers' Church and Caarmel Engineering College

In reviewing GFA donor reports back to 2004, I have looked for line items which could have supported the purchase and construction of for profit schools and hospitals. I have been unable to find enough donations to pay for the massive expansion of Believers’ Church’s footprint in India. More on that in future posts.
For now, I am posting a promotional video of just one of the schools owned by K.P Yohannan and Believers’ Church (both his name and the church’s name are on all property deeds): Caarmel Engineering College.
I suspect U.S. donors had no idea that support given to GFA might end up helping to support a for profit engineering college.