The Evangelical Council for Financial Accountability (ECFA) claims to uphold the “highest standards of accountability.” Yet, the ECFA doesn’t file a 990 tax form with the IRS—and neither do the nonprofits headed by several ECFA board members.
The 990 tax forms provide crucial information to donors, like the compensation of highest-paid employees and whether any related parties do business with, or are employed by the nonprofit. The forms also require nonprofits to list the members of their governing boards.
All secular nonprofits in the U.S. are required to file 990s with the IRS. However, religious nonprofits and churches are exempt. And many Christian organizations, including the ECFA, have claimed church status in recent years, allowing them to bypass the 990 requirement.
Even though the ECFA doesn’t file a 990 with the IRS, it still publishes an annual 990 on its website. However, two of the organizations headed by ECFA board members don’t file a 990 with the IRS, nor do they publish a 990 on their websites.
“The church should be more moral than the world,” said Barry Bowen, staff investigator for the Trinity Foundation. “When you look at the board, these people should be leading by example.”
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Bowen also said he doesn’t believe “self-enforcement (publishing 990s on websites, as opposed to with the IRS) works well. It’s better than nothing, but we’ve seen all the problems with ECFA members. . . . That didn’t prevent corruption.”
TRR reached out to the ECFA for comment, and ECFA President Michael Martin responded: “All ECFA members, including organizations represented by ECFA board members, go through the same accountability processes each year related to the ECFA standards. This includes demonstrating compliance with ECFA Standard 5, related to appropriate financial transparency.”
Standard 5 requires organizations to provide current financial statements, comply with legal disclosures, and offer financial information on specific projects related to donations, upon request.
ECFA Board Member David Beroth is the CFO of the Billy Graham Evangelistic Association (BGEA), which hasn’t filed a form 990 with the IRS in 10 years. The BGEA also doesn’t offer 990s on its website.
Barber, BGEA’s spokesperson, told TRR that in 2015, BGEA requested that the IRS classify them as an “association of churches.” BGEA argues that their work is almost exclusively with local churches and it wants the religious exemptions and religious liberty protection that comes with the classification.
“For example, church-organizations employers are clearly protected from government interference in matters relating to employment, and BGEA believes these and other exemptions protect the ministry’s religious liberty rights,” Barber wrote.
However, around 2015, the BGEA also came under fire for the large salary of its president, Franklin Graham.
According to the BGEA’s 2014 990, Graham drew a salary of $258,677 from the BGEA. He also made $629,821 leading Samaritan’s Purse that year, making his combined salary more than $880,000.
The 26-page audited financial report BGEA currently posts on its website doesn’t specify Graham’s compensation package.
ECFA Board Vice Chair Kurt Nelson also heads a ministry that no longer files a 990 tax form—East-West Ministries, a Christian organization with outreach to Asia. According to the IRS website, the last 990 East West Ministries filed was for 2018.
The ministry states on its website that it offers 990s to those who ask.
TRR requested the form and the ministry sent TRR its 990 for fiscal year ending in September of 2023.
In 2018, when the ministry stopped filing 990s with the IRS, the ministry paid Nelson $313,057 in total compensation. Included in that is a $68,000 in tax-free ministerial housing allowance. In 2023, Nelson received $380,371, including his housing allowance.
TRR reached out to East West for an explanation but didn’t immediately receive a response.
ECFA’s Board Treasurer Jacinta Tegman also heads a Seattle-based organization that doesn’t file a 990, CRISTA Ministries. The organization’s last 990 was filed with the IRS in 2021, though it publishes more recent ones on its website.
CRISTA submitted a 990-T in 2022 to show its taxable income. Bowen said religious nonprofits still need to file 990T forms for any profitable business income, which could include rental property, advertising income, or income from a cell phone tower, for example.
Tegman’s salary in 2021 was $265,000, including a housing allowance, according to its 2021 990. In 2023, her total compensation, including housing allowance, was $340,000.
“(W)hile not required by law due to our recognition as a church, CRISTA will be publishing its audited IRS Form 990 for the 2024 fiscal year when it is able to be posted,” wrote a CRISTA media spokesperson to TRR.
Lastly, ECFA Board Member Holly Duncan heads Parkridge, a pregnancy center in Lubbock, Texas, that stopped filing 990s in 2021. Its website also doesn’t list any financial information.
Duncan made $100,000 in 2021, according to the organization’s 990.
In 2021, James St. Clair, the chairman of Parkridge’s board, also made nearly $70,000 leasing a building to the pregnancy center. Lubbock Central Appraisal District records show St. Clair owns the building where Parkridge is located.
The ECFA recommends that nonprofit boards be comprised of predominantly “independent” members, who aren’t related to the organization’s other executives or board members and do not receive remuneration from the nonprofit.
Duncan did not respond to TRR’s request for comment.
Rusty Leonard, founder of MinistryWatch, said he’s concerned about ministries not filing 990s because it deprives donors of important information, like executive salaries and potential conflicts of interest.
“It is not surprising that some ministry leaders would want to avoid having to disclose that information,” Leonard said. “I value financial transparency as it is too easy for ministries to drift away from doing the right thing without that transparency.”
Rebecca Hopkins is a journalist based in Colorado.
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19 Responses
The Voice of the Martyrs did this too while I was an employee and it never set well with me. I was told it was a way to keep bad actors from learning too much of the internal workings of the company, but I generally assumed it was to avoid criticism from donors and employees.
Another former VOM employee here. I once was a part of a ECFA annual audit for a different org. I was not impressed by it. After being at the center of the GFA exposure, I now see it as foxes guarding henhouses.
Rebecca Hopkins and Julie Roys, excellent reporting. And discouraging news. Electing to not file with the IRS may be legal, but it does not inspire confidence in an organization.
Above the signature line of Forms 990, 1040 and most others appears the following sentence: “Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete.” If an organization’s leaders are unwilling to make that pledge to civil government, how can donors be certain that the report as presented on a charity’s website is the same as it would be if filed with the IRS?
If you don’t maintain a healthy fear of the IRS, which has authority to punish taxpayers, why would you respect members of the general public who have no recourse if your organization misuses the funds that they donate? And what’s the purpose of ECFA if its own board members do not adhere to the highest levels of transparency?
“ If you don’t maintain a healthy fear of the IRS, which has authority to punish taxpayers…”
Cec, I subscribed to this belief for many decades until I began painstakingly researching avenues of government fraud shortly after 9/11 (wake up call).
People who love Jesus must wrestle with objective facts, and if the facts show duplicitous, direct, indirect, or grammatical fraud, then they are obligated morally to stop consenting to and supporting said fraud no matter the degree of consequences.
“ The following images are scanned copies of pleadings (affidavits certified by NARA) wherein a United States Attorney and a United States Department of Justice Trial Attorney, Tax Division, deny that Internal Revenue Service is an agency of the United States Government.”
https://johnhenryhill.wordpress.com/articles-and-documents-provided-by-other-people/
I’ve had many clients in the past that worked for the triple letter federal agencies, and, as far as I know, not one investigated the legitimacy surrounding the origin of their agency (whether constitutional or not), and none were interested in knowing….paychecks, benefits, and positions were too valued.
I’m a former employee of East-West Ministries and have met Kurt Nelson personally. I believe that he and EWMI are generally honorable and doing good work; however, I was DEEPLY disappointed to learn that they had reclassified the organization as a “church” just to get out of filing a 990. EWMI is not a church or an association of churches. (“Religious organizations” in general are not exempt from the 990 requirement — your article is a little inaccurate on that point.) These organizations are lying about being “churches” in order to be less transparent. I think they mean well but are doing something that is morally and ethically wrong. I’m guessing ECFA is advising this to its members. I hope this trend can be reversed.
The Voice of the Martyrs, my former employer and a non-profit endorsed by the ECFA, also does not file their 990s. I was an employee at the time of their decision to stop filing and felt uncomfortable with their choice. I was told it was to conceal certain data from bad actors to ensure the safety of the executive members of the company, but I (perhaps cynically) believed it to be another move to avoid being held accountable by employees and donors.
Do not feel bad, every church I have tried to research, with 501c3, through the IRS site for filings, do not show up as having filed. Having called the IRS about this, I was told that “once a church is approved for 501c3 status, it is up to them if they choose to file a 990, and post budget/donation,spending information.” I asked how they audit these churches to determine if they are compliant, and the response, “it is a honor system, they would have to self report.”
When the ECFA began, many thought it would turn out better than it has. The idea back at its beginning was to head off gov’t regulation and IRS scrutiny by having a watchdog evangelical organization setting financial standards for ministries.
But with the growth of the evangelical industrial complex over the past several decades, and the establishment of megachurches where even the members don’t know who’s on the Board of Elders or how much the pastors and staff are paid in salary and benefits, I think it would’ve been better for the Chrstian community if IRS regulation had come into effect.
The ECFA has been shown to be a toothless tiger, and the churches and parachurch organizations often act without integrity and fiscal prudence with the money given by Christian donors.
RR
Thanks so much for posting this! In fact the Form 990 is THE critical document to begin an evaluation of ANY NGO/501c3 organization (speaking as a CPA (inactive)).
I do not donate to any organization that does not provide this critical data.
This form will also tell how much of the “revenue” is in fact NOT contributions – but hyped up value for donated goods – making the non-Program % (Mgmt, Fundraise) seem much less than otherwise – and, indeed, the top 5 100k or more mgmt needs to be reported – most interesting to see how my donated dollars are actually being used.
I highly encourage people who are serious about stewarding to learn how to read these critical documents.
Greg
Why isn’t preparing and publishing their 990 on their website each year enough? https://www.ecfa.org/Content/Form990
It’s up to the public whether it’s enough. We simply report. However, as Barry Bowen notes, this is a form of self-reporting, which has had problems in the past. It also raises questions as to whether the ECFA classifying as an association of churches is a good practice. The IRS clearly has defined “association of churches” quite broadly and allows it. But this trend has led to scores of problems and may not be the best practice for an accountability watchdog group.
Obtaining legal status as an association of churches is a double-edged sword. On one hand it allows Christian ministries to hire and fire employees based on their adherence to belief/practice standards without running afoul of discrimination and civil rights laws. On the other hand, the status as an association of churches can be abused by refusing to file a 990 in order to hide financial misconduct. The more transparent ministries file a 990 so anyone can see their finances. I think every religious non-profit should be required to file a 990, although with all the clout they have I don’t see that happening.
If you’re going to go to the trouble and expense of preparing a 990, and you are making it public on your website, there’s no reason NOT to also file it with the IRS unless you know the statement is inaccurate and you don’t want to commit perjury.
It’s like making statements to the media about a trial but refusing to make them under oath in the trial itself.
Sadly, it seems more and more like ECFA is a paper tiger. I strongly supported them and encouraged organizations that I was engaged with to apply thinking that it would push them toward more transparency. Sadly, I might have been wrong. One thing sorely lacking in American evangelical churches and organizations is the lack of leadership by example. Way too many leaders of megachurches and organizations think that a different set of rules apply to them because of their position. The most effective way a leader leads is by the example of her life. A simple biblical principle that has been lost in our celebrity driven culture.
They have something to hide.
The miracle history of Crista Ministries’ impressive headquarters building.
God led a minister, Mike Martin, to lease the property north of Seattle that had been a tuberculosis sanitarium before it had been abandoned (which included this building). The county leased the property to the ministry for $1 per year.
Other groups protested the low lease rate and demanded that the property be put up for sale to the highest bidder. God had promised Mike Martin the property so he agreed to relinquish his lease so the property could be put up for sale. Mike Martin and other intercessors involved with the ministry prayed that God would close the mouths of other bidders like He closed the mouth of the lions to protect the prophet Daniel.
The auction date was April 14, 1958. The minimum bid $100,000. Mike Martin bid $100,001. There were no other bidders for the multi-million dollar property. The property was sold to Mike Martin.
During the years when the property was leased, the county withdrew a number of acres so the local school district could build an elementary school. This site was not part of the land auction.
About 17 years ago, standing on a slight hill across the street from the current site of King’s Elementary School, Mike Martin’s son told me how his father stood on the same spot with him looking at the public elementary school that was then across the street. Mike Martin told his son that he did not understand how the land had been taken away from his ministry. Years after Mike Martin died, the ministry acquired the school property. Mike Martin had heard correctly from God, but part of the promise was not fulfilled while he was still alive.
When the EFCA posts the 990 on their website but do not submit it to the IRS they are giving the impression they are filing it but then if they are caught being less than truthful on it they can claim the form was never official since it was never submitted. Everything is done for a reason. Does anyone really attribute any credibility of fiscal responsibility to a ministry that shows the EFCA logo? I think by now most view it as a rubber stamp endorsement that you get for sending them a check.
I was an interim pastor for a small church for a few months. They posted their statement on the bulletin board for all to see, including visitors. I highly respected that.
I was a member of a very small congregation, and was literally put out because, me and other elders asked for a financial report. We were taken to court and are still in litigation. Of course I am not filling in all of the details of how things went down, but our main offense was asking for a report. We are members in exile because Biblical Principles were not followed.