Phoenix Preacher has an email from an assistant of former Gospel for Asia board member Skip Heitzig. Through his assistant Heitzig says there hasn’t been an independent investigation of GFA and the charges are of a “he said/she said” nature. What?
Talk about demoting the Evangelical Council for Financial Accountability. Is ECFA the he or the she?
Perhaps, Rev. Heitzig failed to tell his assistant that GFA was terminated from the ECFA after an independent investigation revealed most of the ECFA standards had been violated. I know that board members were told this. Another former board member Gayle Erwin told me that he was shocked to learn that ECFA terminated GFA and decided not long after to resign.
If Skip Heitzig doesn’t know any facts, why did he resign?
For what it’s worth, I believe Rev. Heitzig and Rev. Walker should try again.
Tag: Gayle Erwin
Gospel for Asia's Board of Directors and Fiduciary Responsibility
During the late 1990s, I served on the board of the American Mental Health Counselors Association. One of the first things we learned as new board members was the concept of fiduciary responsibility. I learned that our organization was formed to serve the interests of our constituents and more broadly the public interest. I also learned that I was responsible to ensure that the organization functioned within the law and in accord with rules we set for ourselves (e.g., by-laws). Furthermore, I had a duty to exercise oversight of staff and the operations of the association.
In light of recent resignations from Gospel for Asia’s board and the secrecy surrounding current board members, it seems appropriate to consider the duties and responsibilities of board members. In my view, GFA’s board shares responsibility with current leadership for the many questions raised over the past two years. Below are quotes from various authorities on the fiduciary responsibility of nonprofit board members.
Boards of nonprofits are legally responsible for overseeing the organization’s financial management. Since nonprofits receive tax-exempt status by state and federal agencies to fulfill public needs, the board’s obligations go well beyond its organization’s members, constituents, beneficiaries or clients.
An important part of serving the public trust is fulfilling the important stewardship roles of protecting financial and nonfinancial assets, and managing current income properly to fulfill exempt purposes. Although a ministry’s management has the primary responsibility for the organization’s financial management and reporting, the board of directors is ultimately responsible for the process. Outside auditors also play an important role as well. – Dan Busby, Quality Financial Reporting: What is the board’s responsibility?
Speaking of outside auditors, GFA’s auditor Bland Garvey recently resigned according to former board member Gayle Erwin.
GFA’s leaders have maintained an unseemly silence in the face of poor relationships with staff, unaccounted for funds, allegations of mismanagement, and other financial irregularities. The responses from David Carroll and K.P. Yohannan have not been specific and have not addressed certain issues at all. My Calvary Chapel survey results thus far find that former donors and supporting pastors are unsatisfied with the answers given by GFA leaders. At this point, GFA directors have a responsibility to speak to the allegations and transparently disclose what is being done to correct any violations of the public trust. So far, outside of comments from former board member Gayle Erwin, all we have heard is crickets.
Since GFA is expected to maintain discretion and control over funds sent to Asia, board members need to have knowledge of how those funds are spent and audited. According to Erwin, the GFA board was not given such information. Recently, Erwin told me, “Once the monetary figures went beyond the local, we board members had no knowledge of it. I am embarrassed by how little we knew.” According to Erwin, the board’s information came from K.P. Yohannan and was not contested by other senior leaders who in Erwin’s words, have to do “what K.P. says.”
Because the board of directors is ultimately responsible for the activities of an organization, it can become the target for criticism or legal action when things go wrong, and failure to live up to fiduciary responsibility is a serious charge.
As trustees of the organization’s assets, board members must be able to demonstrate that due diligence has been employed in decision making, particularly with regard to the oversight of financial matters. While individual board members are responsible for their own actions, the full board is responsible for the board’s decisions. This means that board members must hold each other as accountable.
But nothing absolves the board from its single most important responsibility as a fiscally accountable body of trustees – that of acknowledging the responsibilities that come with being a beneficiary of the public trust. Generally speaking, nonprofits are deemed to be holding assets, including investment funds, in trust for the benefit of their constituencies and the charitable purposes for which the organization was formed. Linda Compton, Painful Lesson in Board Investment Policy Making, Boardsource, retrieved from ECFA
Although the primary topic of Compton’s article is about board oversight of retirement funds, the principles that apply to oversight of those funds also apply to all other activities of an organization. Boards can’t merely blame staff when concerns are raised by the public and constituents of the nonprofit. As it is now, GFA lost ECFA membership, is losing donors, and has not resolved the concerns of well over 100 former staff. Three board members have resigned over these issues. The remaining board members have a duty to God and the public to step in and right the ship. Remaining silent doesn’t remove their responsibility.
Although GFA is secretive about their board members, evidence is strong that current board members are K.P. Yohannan (chair), Gisela Punnoose (KP’s wife), Danny Punnoose (his son), Chuck Zink (has a child on staff), Robert Felder, Francis Chan, and David Mains. According to K.P. Yohannan, there is at least one more member but the identity of that member isn’t clear. Looking at the board members, it would take every non-Yohannan family member to take action. One of the requirements to participate in the Combined Federal Campaign is a board made up of independent members. However, it is plain to see GFA does not meet that standard.
Difficult or not, board members have a duty to the public. Christian board members have a duty beyond that. Only time will tell if GFA’s board will rise to the occasion.
Additional resources:
Fiduciary Responsibilities of Nonprofit Directors
A Nonprofit Board’s Fiduciary Responsibility
Believers’ Church Constitution Contradicts K.P. Yohannan’s Claim that He Has No Legal Authority in Indian Church
In a May 14, 2015 staff meeting, K.P. Yohannan and David Carroll disclosed to the Gospel for Asia staff that in 2013 Believers’ Church in India gave $19.8 million toward the construction costs of the new Wills Point. TX headquarters. When the gift came in back in 2013, GFA leaders told staff that the money was given by an “anonymous donor.”
For those new to this story, Believers’ Church is the church started by Gospel for Asia founder K.P. Yohannan. Yohannan is CEO and International Director at Gospel for Asia and he is the supreme Metropolitan Bishop in India for the Believers’ Church. Although undisclosed in their 2013 audit, GFA sent just over $20 million to Believers’ Church in 2013. Believers’ Church in India received far more than Gospel for Asia India which was not disclosed in the audited financial statements.
Within the last year, questions arose among staff about the accuracy of the “anonymous donor” story and Carroll and Yohannan addressed those questions during the May 14 staff meeting. In that meeting, Yohannan asserted that he had nothing to do with the Believers’ Church’s decision to send nearly $20 million back to Texas. A major part of his defense was his claim that he does not sit on boards or trusts in India and has no legal authority in Believers’ Church. Yohannan claims he didn’t have authority to direct the donation and didn’t have anything to do with it.
Here is what Yohannan said about his membership on boards and trusts in India and his legal authority.
Transcript:
And by the way, just so you know, I am not legally on any boards, any trusts, anything in any of these countries. I have no powers to make decisions or sign money, or release money, or make decisions, I am completely legally…why? Because anybody who work in the United States or overseas countries have a board membership or have legal membership should not be part of their legal entities in India. It’s a conflict of interest and therefore we send the funds and it is immediately under the government watch care and the government of India is responsible and investigative agencies and tax divisions to make sure that is carried out within the time frame or whatever they do, that is a public thing.
In previous posts, I have shown government and church documents which contradict his claim. Today, I provide portions of the Believers’ Church Constitution which describe the massive authority and power of the Metropolitan Bishop, His Grace the Most Reverend K.P. Yohannan. It is clear that Yohannan misled his staff. If Believers’ Church follows the church Constitution, there is no way Yohannan did not approve the gift to help complete headquarters construction.
Click the link for the first two chapters of the Constitution, and this link for chapter three. Images describing the power of the Metropolitan are below. See the boxes for especially relevant sections:
Yohannan is President of all church trusts, he has discretionary power over governance of the church, he is the final authority of spiritual and administrative matters and he is the managing trustee of the church. It is inconceivable that Believers’ Church could spend $19.8 million dollars without his approval. Sections from chapter three make this even clearer. Buying and selling movable and immovable property and any management matter can be overruled by Yohannan. Committees can suggest actions but they must be cleared with Yohannan first.
Yesterday, Gayle Erwin said this about the transfer of $19.8 million from India to GFA-US:
If you read the ECFA report, you discover what we (board members–USA) had begun to know–we were kept in the dark and limited to pedantic decisions. As I saw this, I began intense confrontations with KP which I thought were gaining traction. The surprise revelation of foreign deposits and monies returned from the field (and previously described as from an “anonymous donor) pushed some of us over the edge and made our board membership untenable.
David Carroll and K.P. Yohannan told staff that the transfer of funds was completely legal and there was no conflict of interest since Yohannan had no control over the decision. He also said the $19.8 million was not a related party transaction.
DC [David Carroll] – 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.
By the way, one question, one part of that question was, is this a related party transaction? And the answer is no. It is not a related party transaction because the board members here, they’re not the same board members as there. In other words, the leadership here did not influence that decision there. Brother KP mentioned it but it was not his decision. He had to get permission, actually they told…
KP [K.P. Yohannan]– I think David, it is important for people to know the person I am. It’s like Paul said in one place he’s a doulos, he’s a servant, another place he’s an apostle, another place he’s a brother, and my role is being a spiritual father of right now about 2.7 million people scattered throughout all these nations and I do not have any legal say or decision about legal matters. My role is a spiritual leadership. You may not have asked that but there are hundreds of trusts and entities in all these countries. I don’t sit on any of those things. There are their own people. And my role is the spiritual leadership. And I hope to some extent that is here also.
It is hard for me to understand how David Carroll could make this statement:
It is not a related party transaction because the board members here, they’re not the same board members as there.
I publicly ask David Carroll: Have you ever read the Believers’ Church Constitution? You are ordained in that church. Is this like Mars Hill Church and the officers and clergy don’t have access to the Constitution? You told staff on May 14 that Yohannan wasn’t on a board under the Believers’ Church umbrella. Carroll told staff:
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.
K.P. Yohannan is CEO and leads the Gospel for Asia board here and he is by Constitution the managing trustee and President of Believers’ Church and all other Believers’ Church trusts.
I can’t see how these claims by Yohannan and Carroll and the Believers’ Church Constitution can be true at the same time.* David Carroll said there are “board documents on the other side.” Well, the board documents that I have seen don’t support what they told staff in May. Might be time for GFA leaders to produce those documents. It is already too late for three board members who quit over this matter.
*I suppose it is possible that Believers’ Church approved a new Constitution prior to the 2013 gift. However, my source denies that and tells me that this Constitution was binding at that time and is binding currently. I am certainly open to hearing from GFA and BC with new information.
Former Gospel for Asia Board Member Gayle Erwin Comments on Board Resignation
Earlier today, I saw a private Facebook posting from former Gospel for Asia board member Gayle Erwin which contained some new information about GFA and the ECFA. Erwin was responding to my post about the resignations of Damian Kyle, Skip Heitzig and Erwin from GFA’s board. I wrote to Erwin with a request to cite the quote here. He agreed with the condition that I highlight his positive comments about GFA staff. About GFA and ECFA, Erwin said:
If you read the ECFA report, you discover what we (board members–USA) had begun to know–we were kept in the dark and limited to pedantic decisions. As I saw this, I began intense confrontations with KP which I thought were gaining traction. The surprise revelation of foreign deposits and monies returned from the field (and previously described as from an “anonymous donor) pushed some of us over the edge and made our board membership untenable. The staff of GFA in Texas, despite some inferences in the discussion on your page above, are some of the finest, most ethical and loving people I know. I marvel at how well commenters on your page have combined ignorance and hostility. I thought I was making progress in ways that would have solved and prevented this heartbreak and replaced it with victory, but I was wrong but not wrong in the ways your commenters infer. (emphasis from Mr. Erwin)
Erwin later added:
I was shocked when informed that GFA had failed all 7 of ECFA criteria for membership and had consequently been removed from membership.
In his first comment, Erwin referred to the transfer of $19.8 million from India’s Believers’ Church to GFA in Texas for the purpose of completing construction on their new Wills Point, TX headquarters.
This comment provides some insight into the perceptions of board members regarding the issues I have been raising for months. It seems they (at least Erwin) have of late felt they were kept in the dark. Erwin says he and the other board members were not aware of the source of the nearly $20 million.
I think it is important to consider Mr. Erwin’s wording regarding the donation from the field: “The surprise revelation of foreign deposits and monies returned from the field (and previously described as from an “anonymous donor) pushed some of us over the edge and made our board membership untenable.”
Those foreign deposits were funds given by donors for mission work which were sent to India and deposited into accounts of the K.P. Yohannan controlled Believers’ Church. Then nearly $20 million were authorized by Believers’ Church to be sent back to Texas to help finish construction of the palatial Wills Point, TX headquarters.
Like Mr. Erwin, I suspect donors will find that to be untenable.
Three Gospel for Asia Board Members Resign
I have confirmation from someone in a position to know that Skip Heitzig, Gayle Erwin, and Damian Kyle have resigned from the Gospel for Asia board. None of the men responded to my requests for information but multiple sources within GFA have confirmed that an announcement was made during a staff meeting time on Friday.
Very little explanation was given and the announcement was delivered by Danny Yohannan Punnoose (K.P. Yohannan’s son). While GFA will not confirm, it appears that K.P. Yohannan’s son and wife, Francis Chan, Chuck Zink and perhaps one other person are now on the GFA board.
It is astonishing that the second largest mission organization in the nation keeps so many secrets regarding governance and finances.