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A Luxury Suite, Questionable Loan to Officer, & Gambling: The Disturbing Truth About Leadership at MBI

By Julie Roys

As a Christian non-profit ministry supported by donors and dedicated to equipping believers to make disciples around the world, the Moody Bible Institute (MBI) should maintain the highest ethical standards among its leadership. Sadly, this has not been the case in recent years.

From maintaining a luxury suite for a famous board member to questionable loans to officers and targeting whistleblowers, MBI leadership has overseen a system of perks, privileges, and punishment that’s an affront to the gospel.  And sadly, this web of influence and corruption has not only hampered the board’s ability to deal with the current crisis facing the institute, but contributed to it.  

Board Engages in “Self-dealing”

Though IRS rules prohibit non-profits from loaning officers and board members money, or providing them with facilities and services, the MBI board apparently has been engaging in this practice, called “self-dealing,” for years.

In 2009, the institute gave President Paul Nyquist a $500,000 interest-only loan to buy a $1.08 million condo “adjacent to the institute.”  This was at a time when the institute was experiencing significant financial stress, which has only exacerbated over subsequent years.  Recently, the institute announced it is closing its Spokane campus and cutting one-third of its faculty due to financial troubles. 

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[pullquote] “I’m always against loans to corporate officers and directors. . . . If it’s not paid back, then that certainly puts it into the category of self-dealing. I’d be very uncomfortable in an audit in a situation like that.”[/pullquote]When asked generally about the practice of loaning to officers (not MBI in particular), Attorney Rich Baker, a partner with Mauck and Baker, a Chicago law firm known nationally for representing religious institutions, said: “I’m always against loans to corporate officers and directors. . . . If it’s not paid back, then that certainly puts it into the category of self-dealing. I’d be very uncomfortable in an audit in a situation like that.” According to the latest 990 Tax Form, over the past nine years Nyquist has repaid none of his $500,000 loan. 

When I confronted Randy Fairfax, current chairman of MBI’s Board of Trustees, about Nyquist’s loan, he said he’s talked to lawyers and accountants who would dispute Baker’s opinion. He also said that he had been involved in the decision to give Nyquist the loan, and that the institute did so only after consulting with legal and accounting professionals who assured MBI that the loan was legally permissible. He added that the institute has reported the loan every year on its 990 tax forms.

The IRS allows for an exception to certain types of compensation to so-called “disqualified persons,” provided the compensation is “reasonable and necessary to carrying out the exempt purpose” of a non-profit.  However, Nyquist’s home is worth more than double the median sale price of homes around the institute.  And, his total compensation in 2010 was $309,630, and increased 9.4% to $338,735 in 2016.

I emailed MBI CFO Ken Heulitt for clarification concerning Nyquist’s loan, but did not receive an answer. I also have asked Paul Nyquist for an interview, but he has not responded. 

From 2000 to 2008, the institute again reportedly engaged in self-dealing by providing Jerry Jenkins, author of the popular Left Behind books and then-chairman of Moody’s Board of Trustees, with a luxury suite on the top floor of Jenkins Hall.  In 1999, Jenkins donated an undisclosed amount of money to Moody, enabling the institute to purchase the building that bears his name.  And according to a 2006 article in the Chicago Tribune, MBI then converted two former senior units on the top floor of the building into a suite for Jenkins and his wife’s use, something state officials reportedly found “troubling.” 

[pullquote]”According to Konrad Finck, former facilities manager at MBI, Jenkins and his family members used this ‘glitzy’ suite as a ‘second home.'”[/pullquote]According to Konrad Finck, former facilities manager at MBI, Jenkins and his family members used this “glitzy” suite as a “second home.”  Finck said that other than those who cleaned the apartment and maintained it, only Jenkins and his family members had access to it.

Had MBI allowed other people to use the suite, and had Jenkins used the apartment only when he was in town on trustee business, it would not be considered self-dealing.  However, Finck said the family left their clothes in the closet and furnished it with their own furniture.  In addition, Jenkins’ wife would stay at the suite when in town, and a child of Jenkins used it as well. 

The suite had top-of-line finishes, and a “big walk-in shower,” which became a “bone of contention” to Finck.  “(Jenkins) kept complaining that it leaked,” Finck said. “It was at that point that I started to have some very negative feelings about the whole thing because he was very demanding.”

Finck said others at the institute started expressing concern about the apartment as well.  “It looked to some of us like it wasn’t really quite according to Hoyle.  I mean was he paying rent? . . . It didn’t look to us like he was.”

Sometime around 2008, Finck said someone at the institute submitted an anonymous “whistleblower report” internally at MBI.  As a result, senior management reportedly put an end to Jenkins’ exclusive use of the suite. 

Finck said he dropped the matter after that, and assumed Jenkins’ use of the suite had changed.  However, Finck knew the identity of the whistleblower.  And at one point, he said a senior manager at Moody called him into his office and asked him to divulge the name of the whistleblower, but Finck refused.

“I know Jerry was very upset about (the whistleblower),” Finck said. “I know that he was trying to find out who had – he wanted to talk to the person that had done the report. . . . To me, even asking for that was totally unacceptable because the whole agreement with the (whistleblower) website was that you would not be asked to identify yourself.  He should have known that as the chairman of the board.”

Jenkins declined my request for an interview, but offered the following statement: “This unfortunate misunderstanding was thoroughly investigated years ago by the board of trustees and the administration, and I received an apology for any implication that I had ever maintained for my exclusive use or considered my own the guest apartment in Jenkins Hall.”

I sent an email to Ken Heulitt, MBI chief financial officer, and Brian Regnerus MBI director of strategic communications, asking for details of this investigation and clarification about Jenkins’ use of the suite, but received no response. I also asked Trustee Emeritus Paul Johnson, who reportedly knew about the MBI investigation, if he would be willing to talk to me about it, but he did not respond. 

Then yesterday at noon, I received an email from Greg Thornton, MBI senior vice president of media, informing me that “after consulting with the Executive Committee of the Moody Board, leadership is terminating your employment.” No reason was given and I was informed that my boss, Program Manager Dan Craig would be at my house in two-and-a-half hours to pick up my laptop..

MBI Dropped Gambling Prohibition With Knowledge Its Chairman Was Gambling

For several years, I have been deeply concerned about apparent unethical behavior and collusion between MBI management and its board.  In 2013, I served on the employee committee that reviewed MBI’s employee standards and suggested changes to leadership. After numerous meetings, our committee recommended dropping prohibitions against alcohol and tobacco use, but insisted that a prohibition against participating in “institutionalized gambling” be retained based on Eph. 5:3-7

Several weeks after making these recommendations, Greg Thornton, who had facilitated the employee committee discussions, called me into his office for a private meeting.  Because I had expressed the most opposition to dropping the gambling prohibition, Thornton said he wanted to meet with me personally to let me know that senior management had removed the gambling prohibition, contrary to the committee’s recommendation.

In September 2013, Moody announced its new employee standards.  And a month later, WORLD Magazine reported that Jerry Jenkins had admitted to gambling both in his home and at casino poker tournaments.

[pullquote]”I asked him if MBI officers were aware that Jenkins was gambling when they decided to remove the gambling prohibition.  Thornton admitted that they knew.”[/pullquote]After this revelation, I met privately with Thornton again.  I asked him if MBI officers were aware that Jenkins was gambling when they had decided to remove the gambling prohibition.  Thornton admitted that they had.

Jenkins has since apologized to the board, faculty and staff of MBI for the trouble his gambling caused.  He’s also pledged to “never patronize a casino again,” but has not pledged to stop gambling. Jenkins also retained his position as board chairman, but in 2015, after a transition year training Randy Fairfax to succeed him, he stepped down and now serves as a trustee.

Foxes Guarding the Henhouse?

Given Jenkins’ history, and the suspect loan between the board and Nyquist, it’s not surprising that Jenkins and his successor, Fairfax, initially ignored evidence of wrongdoing by Nyquist’s administration, which surfaced this fall.

In October, prior to an on-campus meeting of the board of trustees, a recent MBI graduate sent an email to Fairfax and board member Juli Slattery, charging that MBI had “begun trading the sure foundation of God’s Word . . .  for the fragile foundation of the cultural tides of the day.” The letter documented numerous examples of this, including several disturbing accounts from the classes of Professor and Chair of the Urban Ministries Program, Clive Craigen.  The email was reportedly forwarded to Jenkins, but not some of the other board members, and resulted in no action.

Then on October 25, I sent an email to Slattery informing her of potential wrongdoing at the institute and urging her to share the information with other trustees and commission a full investigation.  My email told about a meeting on April 5 between administration and the Faculty Concerns Committee “after a substantial number of faculty members (perhaps 30 or more) sent letters to the Faculty Concerns Committee in early 2017 expressing serious concerns.” 

These concerns included “charges against (Provost Junias) Venugopal of his changing his expectations, mishandling individuals and groups, unfair hiring practices, mandates without discussion, dismissing concerns about theological drift at the institute, violations of shared governance, and lack of respect for faculty.” 

As evidence, I attached a letter from a Moody professor to Associate Provost Larry Davidhizer, referencing the April 5 meeting and also expressing dismay about the way the administration had handled the meeting. Reportedly, Venogupal shut down discussion, he and the deans treated faculty in an antagonistic manner, and Nyquist ended the meeting with a divisive comment thanking those loyal to the administration. The letter also referenced an incident when Venugopal reportedly reprimanded 18 faculty who had come to him with an issue involving theology and asked why those who were seeking to protect the doctrinal statement would be treated in that manner.

[pullquote]”Fairfax later told me that he responded by calling and talking to Nyquist, but then dropped the matter without forwarding any of the information I had sent to the rest of the trustee board or talking to even one faculty member . . . ” [/pullquote]Slattery told me that she forwarded the contents of my email including the professor’s letter to Jenkins and Fairfax.  Fairfax later told me that he responded by calling and talking to Nyquist, but then dropped the matter without forwarding any of the information I had sent to the rest of the trustee board or talking to even one faculty member.  He also admitted that he had not requested any of the 30 or more faculty letters submitted to the Faculty Concerns Committee. To my knowledge, neither had Jenkins or Slattery.

On December 15, I flew to Detroit to meet with Trustee Emeritus Paul Johnson and Vice-Chairman of the Board Rick Warren (a businessman from Michigan, not the famous pastor) so I could share the contents of my investigation with them. At that time, Warren had heard nothing of the April 5 meeting with the Faculty Concerns Committee, nor the issues that had led up to it. Johnson had heard of it days earlier, but only because he had a phone conversation with Theology Professor Rich Weber and then had received a 65-page document from Weber detailing many of the issues. 

Jenkins recently claimed in a comment on an article published by the Christian Post, “By the time Ms. Roys went to Warren and Johnson, several of us trustees were discussing the serious issues she and many others had raised.” I don’t know who these trustees were who were having these discussions with Jenkins, but apparently it didn’t involve Johnson or even the vice-chairman of the board.

From my vantage point, it wasn’t until after Weber sent the document and I met with Warren and Johnson that the board began to take any action.  But instead of driving the process, both Fairfax and Jenkins sidetracked it by criticizing me for allegedly violating “protocol” and going directly to trustees.  Fairfax confronted me for violating protocol during a phone conversation the day after I met with Warren and Johnson.  Similarly, Jenkins sent a letter soon after my meeting with Warren and Johnson to the entire board likewise complaining that I had violated protocol.

[pullquote]”Trustee boards are supposed to hold administrations accountable and protect whistleblowers.”[/pullquote]Trustee boards are supposed to hold administrations accountable and protect whistleblowers.  Fairfax and Jenkins did just the opposite. And disappointingly, when I sent a document to the trustees informing them of Fairfax’s and Jenkins’ actions and inaction, nothing happened.  But then again, some of those on the current board probably approved Nyquist’s loan. Certainly all must know about it.  In addition, some more veteran members probably are aware of Jenkins’ alleged improper use of the MBI suite.

These sad facts are what finally drove me to go public with this information. I am glad board members are finally willing to investigate and address the very serious issues with the current administration. But what about the extremely serious issues with the board? I have followed the “protocol” of Matthew 18. I have talked to administrators and numerous trustees. I have confronted them with evidence of wrongdoing and urged them to own their sins and step down.  But they have not. And now is the time for reckoning.

The words God spoke to the church in Sardis two-thousand years ago seem especially apropos to Moody today:  

I know your deeds; you have a reputation of being alive, but you are dead. Wake up! Strengthen what remains and is about to die, for I have found your deeds unfinished in the sight of my God. Remember, therefore, what you have received and heard; hold it fast, and repent.

The full MBI board is scheduled to meet tomorrow on the Chicago campus of the Moody Bible Institute.  I pray for the sake of Moody, but more importantly for the sake of God’s Kingdom and glory, that these leaders confess, lament, and own all they have done and allowed.  I believe God can and will rebuild Moody, but only if its leaders respond with humility and contrition at this crucial hour.

Please continue to pray for Moody and its leaders. Pray too for the faculty, staff and students, who certainly are hurting and struggling as a result of the current state of affairs.   

Correction: An earlier version of this post noted that Paul Nyquist made $233,252 in 2009, which would mean his salary increased 45% between 2009 and 2016. However, Nyquist’s employment began in April 2009, so his 2009 salary was for a partial year.  



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109 Responses

  1. I posted 3 times sharing facts that clearly refute 2 of your allegations (with proof) and my comments were all deleted. I guess you are not ‘up for debate’… no matter how respectful. Truth must not matter, just your own narrative.

The Roys Report seeks to foster thoughtful and respectful dialogue. Toward that end, the site requires that people register before they begin commenting. This means no anonymous comments will be allowed. Also, any comments with profanity, name-calling, and/or a nasty tone will be deleted.
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