A Canadian Pastor Explains Why His Church Dropped Support for Gospel for Asia

Bruce Morrison is a pastor in New Glasgow, Nova Scotia, Canada. For 20 years, Morrison’s church supported Gospel for Asia but stopped doing so in April of this year. Now, in a 13 page letter, Morrison details the reasons for ending support and provides insight into his efforts to get answers from GFA.
Morrison’s findings are very similar to my own. While we have spoken some over the past several weeks, Morrison began looking into GFA’s finances about a month before I did. His church dropped support about the time I began writing about GFA and came as the result of his research and efforts to get answers from GFA.
Read Morrison’s letter with the knowledge in mind that his church supported GFA for 20 years. It is hard to believe that a church with that track record would be unable to get basic answers from a mission organization. However, given my experience with GFA, I certainly believe it. The lack of information and answers should be a red flag to current and prospective donors.
Silence is complicity
Morrison writes with concern for other churches. After asserting that “stories of abuse at the hands of spiritual leaders are far more common than they should be,” Morrison writes:

It is with both a sense of reluctance, but also of moral responsibility, that I write this letter to the larger body of Christ. Reluctance – from the unpleasantness of speaking about the need for correction in a Christian ministry, and responsibility – since silence in instances such as I will describe herein is complicity.

If GFA has answers to the issues which Morrison raises, it it beyond my understanding why they have not offered them. Specifically, Morrison wants an explanation of why foreign contributions to India for 2013 in the amount of $43.48 million do not show up in Indian records. He wants to know why over $150 million was sitting in Indian banks at the end of FY 2013. He wants to know if GFA got written permission from donors to bank around $50 million in a corpus fund.  There are many other questions as well.
I encourage readers to read Morrison’s letter to the “larger body of Christ.”
 

Gospel for Asia's Auditor Retains Attorney for Some Reason

This is getting interesting.
On Tuesday afternoon, I contacted Bland Garvey, the accounting firm which did Gospel for Asia’s 2013 audit. I wanted to know if BG had been retained to do GFA’s 2014 audit and perhaps learn why the audit is not out yet. As I understand it, GFA has to turn in an audited financial statement by July 31 to the Evangelical Council for Financial Accountability as a part of the requirements for membership. GFA is a charter member of ECFA. GFA has been referring to the organization’s membership in ECFA as a means of deflecting questions unaccounted for funds and so it is probably important to protect that membership.
When I called BG, I was referred to attorney Gary Kessler. I called and wrote Attorney Kessler with the following questions:

Is Bland Garvey doing the 2014 audit for Gospel for Asia? If not, why not?
If so, will BG correct the misstatements from the 2013 audit that GFA-US only gave money to GFA India and several other GFAs in Asia when in fact GFA-US also gave money to three other NGOs?
The amount of money GFA said they donated to GFA-India is millions more than what GFA-India reported to the Indian govt. Will BG mention this discrepancy?
Last years audit was complete by June 13; this years is much later. If BG is doing the audit then why has this audit been delayed.

He wrote back with the following:

Mr. Throckmorton,
Applicable law prevents a CPA from communicating the information you requested. I advise you to contact Gospel For Asia and obtain the information you seek.
Thank you.
Gary

I wrote back asking for citation of TX law that forbids BG from acknowledging their auditing relationship with GFA and asked if he was representing BG in any litigation. He wrote back to say:

Please contact Gospel for Asia for any information you desire regarding the organization. I will not be responding to any more of your requests.
Thank you.
Gary

And so Mr. Kessler joined a growing list of people from Texas who don’t want to talk to me.
Having looked at the CPA law, I can understand why BG cannot address all of my questions. However, just telling me that they are doing GFA’s audit isn’t as clear cut to me. According to TX law, if BG has told the anyone in the public that GFA is an audit client, then they are not required to withhold information. See this clause:

The provisions contained in subsection (a) of this section do not prohibit the disclosure of information already made public, including information disclosed to others not having a confidential communications relationship with the client or authorized representative of the client.

I already know BG did the 2013 audit so I know there was a relationship. And it is possible that others not now affiliated with GFA know if BG is auditing the books. This should be known soon enough because that audit should be available to the public if GFA wants to remain a member of ECFA. That is, of course, unless ECFA gives GFA a pass. Hopefully, then we will know if GFA corrects the misstatements in the 2013 audit.
What puzzles me is why BG didn’t just tell me that but instead referred me to an attorney who in turn referred me to GFA.
 

C'mon Gospel for Asia, Let's Talk

On May 7, 2015 Gospel for Asia’s Chief Operating Officer David Carroll told me he would no longer answer any more of my questions. Leading up to that email was my question about why funds given and reported outside of India didn’t show up in Indian records. Specifically at that time, I asked about the funds (15 million Canadian dollars) declared in Canada as being sent to India in 2013 but never reported as being contributed from a foreign source as required by Indian law (I later wrote about that discrepancy). My email from May 5 was as follows:

David – I have reviewed some information available to Canadians regarding charities. In the year most recently available, filings with the Canadian govt. show 15million to India.
In the same year in India, govt forms show nothing came in from Canada.
Can you account for this discrepancy? I intend to write about this tomorrow afternoon.
Thank you, Warren

On May 6, Carroll wrote back:

Good morning, Mr. Throckmorton,
The Canadian funds were combined with U.S. funds by our auditor in India for various accounting reasons. There is no requirement that they be reported separately.
Thank you.
David

That same day, I wrote back with follow up questions and a request for information.

David – Can you provide contact information for your auditor in India? This combination of funds appears to be in violation of Canadian law, and possibly Indian law, according to my sources. I would like to understand the auditor’s rationale for believing there is no rationale for these sources to be reported separately.
Thanks, Warren

On May 7, Carroll cut off contact.

Warren,
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.
Sincerely,
David

In my post on the Canadian funds, I made sure GFA’s position was included. I would have included more if GFA had provided it. Instead I got my hand smacked and was sent to time out.
I have written GFA several times since then. I have addressed correspondence to Carroll, John Beers, and K.P. Yohannan. I have sent some of the emails to the Evangelical Council for Financial Accountability. No answers.
In light of my efforts to get answers from GFA, imagine my surprise when I heard from former donors that GFA is saying they tried to work with me but have been advised by their financial consultants (?) not to talk to me. I wrote David Carroll yesterday to ask him if GFA reps are telling donors that GFA tried to work with me. Apparently still taking his financial consultants’ advise, there has been no reply.
GFA, according to several former donors, you are telling them that the reason you can’t disclose answers to the question posed here is because I am asking about funds going to high risk areas for persecution.  We both know that isn’t a plausible answer since no identities or activities would be disclosed by answers to the questions I have asked.
GFA, if you are telling donors that you have tried to work with me, please stop. We both know better. I am willing to look at any new information you provide. You know it isn’t just me asking these questions. Pastors are asking, donors are asking, staff are asking, former staff are asking. If you really want to work with me, you have my contact information.
The following issues would be a good start:

Indian Tax Court on Gospel for Asia and Believers' Church: "Substantial Income" Not Used for Intended Purposes

In 2014, an Indian tax court considered a claim against Gospel for Asia and Believers’ Church. According to a court filing dated December 12, 2014, Gospel for Asia and Believers Church spent more of their income than allowed on purposes not related to the reason they were formed. Doing so made that income taxable. Gospel for Asia and Believers’ Church together appealed the assessment of tax, saying that the use of the funds were given to related organizations which had charitable purposes. The court found that funds were still being used for unintended purposes and remanded the matter back to the tax assessor. I have been unable to find any documentation of how much GFA and BC had to pay or if the matter has been resolved.
You can read the whole thing at this Indian site where public records are archived. I have pulled out the relevant portions below:

Shri M Anil Kumar, the ld.DR submitted that both the assessees are registered as charitable trust u/s 12AA of the Act. During the year under consideration, the assessing officer found that both the assessees have given loan to other trusts from the unutilised portion of the income which exceeded more than 15%. Referring to section 13(1)(d)(i) of the Act, the ld.DR submitted that the assessee trust invested its funds in the form/mode otherwise than prescribed in section 11(5) of the Act. Therefore, according to the ld.DR, there was violation of section 11(2) r.w.s. 13(2)(d) of the Act. According to the ld.DR, the assessee is not entitled for any exemption.

Assessees refer to Believers’ Church and Gospel for Asia. Both are registered as charitable trusts. Both groups had income during the 2010-2011 tax year and loaned more than the allowed 15% to other charitable trusts related to GFA and BC. Originally, the tax assessor considered those loans improper investments which meant that the income invested was not exempted from tax. The original complaint of the tax assessor was eventually set aside in favor of another interpretation by the tax court and remanded back to the tax assessor for reassessment of tax.
GFA and BC had the following interpretation of tax law. The “ld.representative for the assessee” refers to GFA’s and BC’s representative.

On the contrary, Shri Venkitachalam, the ld.representative for the assessee submitted that both the assessees advanced funds to other registered trusts which have similar objects. According to the ld.representative, the assessee advanced funds to BCMET for construction of hospital building. BCMET is also a registered trust u/s 12AA of the Act. The ld.representative further submitted that Carmel Education Trust also a registered charitable trust u/s 12A of the Act was given funds by the assessee to carry out their charitable activities. According to the ld.representative, when the funds were advanced to other similarly placed charitable trusts, amounts to application of income; therefore, the provisions of section 11(2) are not applicable. The ld.representative further submitted that advancing money to similarly placed charitable trusts does not amount to investment or deposit. Therefore, there is no violation of section 11(5) of the Act also.

GFA and BC “advanced funds” to related trusts, one involved in building Believers Church Medical College Hospital and the other an educational trust which operates various schools. I don’t know for certain, but it sounds like the educational trust was given funds to help fund operating expenses. The BC’s hospital was given money for construction of the state of the art facility. Thus, BC and GFA took income on donor money and used it to fund the hospital and engineering school.
The court considered both sides and concluded that “substantial income” of GFA and BC was not used for “the purposes for which they were formed.”

We have considered the rival submissions on either side and also perused the material available on record. It is not in dispute that substantial income of the assessee trust was not used by both the assessees for the purposes for which they were formed. (emphasis added)

The court said there is no question that GFA and BC misused the funds. The main question was about how to treat those funds for tax purposes. After going through an evaluation of Indian law relating to the facts of the case, the court ruled as follows:

Therefore, in view of the latest development of law with effect from 01-04-2003 if the income is paid or credited to another trust or institution even though they are registered u/s 12AA or approved u/s 10(23C) of the Act, the same has to be treated as income of the assessee.

bcmch
Believers’ Church Hospital and Medical College

Since GFA and BC loaned/advanced more than allowed by law, that income has to be treated as income of the two organizations. The court then sent the matter back to the tax assessor to figure out what GFA and BC owed.
I can’t find any additional cases or appeals so the matter might still be active. I asked GFA what happened in the case but, as usual, received no answers.
Donors have questions but all they are getting are assurances that their donations are going for the purposes intended. This case provides one more basis to question that claim.
This case adds one more item to the growing list of concerns about GFA’s financial affairs.

Indian Newspaper: Gospel for Asia and Believers' Church Threaten Newspaper, Claim Defamation of the Metropolitan

This seems like an odd way to evangelize.
I can’t read the Malayalam but the English indicates that GFA-India and Believers’ Church are threatening (or have filed, I can’t tell for sure) a defamation suit against a paper in Kerala India (“Breaking News Weekly”). If this is accurate, GFA-India and Believers’ Church are demanding $15.7 million for defamation which includes calling K.P. Yohannan by his name instead of referring to him as Metropolitan Bishop.
I am seeking a translation but for now here is the “legal notice” according to the paper.
 
Defamation suit1
Defamation suit2
Note that the letter says calling K.P. Yohannan by his name is defamation. He apparently is to be addressed as Metropolitan Bishop. The next two pages pull out Malayalam passages from the paper which GFA/Believers’ Church believe to be defamation. Here is page three and four. Page five is below.
Defamation suit3 Defamation suit4 Defamation suit5
This is all that was provided by the Indian newspaper. The amount demanded in U.S. dollars is $15.7 million (100 Crores). The lawyer wants that sum in 7 days.
If this is true, it won’t be the first time GFA/Believers Church have sued in India. You can use this website to read cases where GFA has been sued and has sued various parties in India.
 
 
 

Francis Chan Joins Gospel for Asia Board Meeting Today; Is He Still Skeptical?

Last week, I publicly asked pastor Francis Chan for some answers regarding Gospel for Asia, a ministry he has endorsed. Today, I learned from a source at GFA that GFA’s board is meeting in Wills Point today with Francis Chan in attendance. It is not clear if Chan is there as a new board member, as has been rumored, or if he is there to be skeptical and ask questions. In any case, this heightens expectations that perhaps GFA leaders might break their silence. 

If Chan does join the board, that might help to address concerns but not just by joining. The expectation is that he would use his position on the board to create a culture of transparency. If he doesn’t do that, the impatience of donors and the public will grow.

As a summary, here are some concerns for GFA.

While these are not the only problems, getting some information about them would be a good start.

Francis Chan: Can You Get Some Answers From Gospel for Asia?

Some time ago I emailed Francis Chan ab0ut his endorsement of Gospel for Asia. Chan says on the video below that he is skeptical and because of that he sent people to check GFA out. I was told by his assistant Chaz that he was getting my emails, but it was unlikely that I would get a personal response from Chan. And as Chaz predicted, I have not heard from Chan in response to concerns I raised in the emails and blog posts.

Watch Chan’s endorsement of GFA.

Rev. Chan, like you, I am skeptical, but unlike you, I don’t have a budget that allows me to send people to check GFA out. However, I have asked GFA multiple times for help understanding why their 2013 audited statement says they sent $58.5 million to GFA-India in 2013 but only $6.5 million shows up in GFA-India’s reports to the Indian government. I can account for another $22 million that GFA in the U.S. sent to Believers’ Church and two other NGOs controlled by K.P. Yohannan but that leaves about $30 million unaccounted for. It seems like a discrepancy like that would make a skeptical person wonder what happened to the $30 million.

If you or your auditors know anything about the unaccounted for $30 million, could you let me know? If there is a reasonable explanation for this, then it seems odd that GFA has allowed the situation to go on without public disclosure. The ECFA is no help either. All the silence makes a skeptical guy like me wonder what is happening. However, it seems like you might know something and perhaps could reassure donors and the public.

Also, there are some other matters which you could really help with:

Rev. Chan, many people trust you, and like you, I am skeptical and don’t believe it is wrong to ask questions. Perhaps, you know something about these matters and could persuade GFA to simply offer additional information and explanation. Or perhaps you, as an endorser, could write and clear things up. We aren’t the only ones who are skeptical, others too want to know what is happening at GFA.

I hope to hear from you.

Will the Evangelical Council for Financial Accountability Hold Gospel for Asia Accountable?

I am not betting on it.
CashThe Calvary Chapel Senior Pastors Conference ended yesterday with no public statements from anyone within the Calvary Chapel movement about Gospel for Asia. GFA exhibited at the conference but left their table unmanned much of the time according to sources there. Several pastors, speaking on condition of anonymity, told me that their church would soon drop support for GFA due to GFA’s public silence about various financial, personnel and leadership concerns.
Several sources have told me that GFA is holding up their membership in the Evangelical Council for Financial Accountability as proof that no real problems exist. Furthermore, GFA insiders have told me that ECFA executives have reviewed GFA’s finances and is privately expressing confidence in GFA. ECFA leaders have ignored my requests for clarification or explanation about the missing money, money carrying to India, etc.
Mars Hill Church similarly pointed to ECFA membership as an indication that funds were being used properly. Even as the church did that, Mars Hill made changes to their procedures to come more into compliance with ECFA guidelines. What I learned about ECFA via the Mars Hill experience and then later through ECFA’s handling of Faith Christian Church is that donors cannot count on ECFA to disclose problems with members.
Now ECFA membership is being used by GFA to avoid explanations of multiple concerns raised by around 100 former employees, former donors, and bloggers. In my opinion, ECFA is now responsible for whatever problems GFA manifests. Here again is a summary of issues that GFA and ECFA have ignored.

Millions of dollars are unaccounted for and GFA has not given any reasons or explanations. Now GFA is claiming that ECFA has seen the books and has given the all-clear.
Since GFA won’t be accountable, I publicly call on ECFA to provide information relevant to list of concerns listed above.
 

Gospel for Asia Exhibiting at Calvary Chapel Pastors Conference; Any Answers There?

Earlier today, Danny Yohannan (K.P. Yohannan’s son and in leadership at Gospel for Asia) tweeted the following:


GFA is exhibiting at the Calvary Chapel Senior Pastors Conference (watch live here). I wonder if GFA will address any of the CC pastors’ questions.
Tomorrow will be two months since GFA told me they would answer no more questions. GFA reps have time to exhibit at this conference but they can’t be bothered to address other matters such as:

In addition to the “awesome free materials” perhaps Mr. Yohannan could give some free answers to these questions. If anyone attending the Calvary conference gets any responses, please add that information in the comments or send me an email.

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.