Moody Bible Institute (MBI) last week issued a statement claiming “there is no corruption, or any illegal and unethical activity taking place at Moody,” adding “it is false to characterize” the institute’s actions in this way. Though MBI offered very few facts to refute the evidence of wrongdoing I presented in blogs on Jan 9 and Jan 18, it nonetheless sought to leave an impression that all is well at the institute.
However, all is not well, and Moody’s latest statement has only further muddied the waters. The $500,000 loan to former President Paul Nyquist is legally questionable, and certainly ethically wrong. The institute has given no evidence to refute first-hand accounts that Trustee Jerry Jenkins used a Moody-owned apartment as his own. And clearly, some MBI faculty profess postmodern views that appear to contradict the institute’s doctrine of inerrancy.
As I wrote in a previous post, it was my desire from the beginning for MBI to deal with these and other issues internally and then to communicate openly and transparently about them with supporters, alumni, students, and employees. Instead, the MBI board decided to deny many of its problems, though it simultaneously removed the institute’s three top officers, leaving many confused.
That confusion persists, and Moody’s latest statement obscuring the facts has not helped.
The Loan to Nyquist
MBI claims that the $500,000 loan it gave to former President Paul Nyquist to buy a $1.08 million condo violated no IRS rules and complied with an Illinois statute, which allows “this type of principal resident loan.” It also said, “Dr. Nyquist has been faithfully paying” the 4% loan.
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“The existence of an exception is not the issue. The issue is whether Nyquist’s loan meets the criteria for the exception – and it does not.”
The existence of an exception is not the issue. The issue is whether Nyquist’s loan meets the criteria for the exception – and it does not.
The reason for the exception in both the state and federal law is to help someone of meager means – a poor pastor, for example – to take a position with a church or nonprofit in an area with prohibitively high-priced housing. It is not intended to help executives like Nyquist making more than $300,000/year to buy a condo worth twice the median value of homes in the area.
This is an abuse of the exception, and likely would not pass the “reasonable and necessary” IRS standard under the scrutiny of an audit. The loan puts MBI at risk of a hefty IRS fine, and could even jeopardize its nonprofit status.
In addition, saying that Nyquist has been faithfully paying the loan is deceptive. Yes, he has been paying interest on the loan. But from 2009-2016 (and presumably to the present), he has paid back zero principal. This is crucial because as an expert in non-profit law noted in my first piece, if the principal on a loan to an officer is not paid back, then it “puts it into the category of self-dealing.”
I first discovered Nyquist’s loan a couple years ago when I visited the Charity Navigator website. The group no longer rates tuition-based institutions, but at the time had a rating for MBI, which included a red “X” calling attention to Moody’s questionable practice of loaning money to an officer.
According to the site, “Making loans to related parties such as key officers, staff, or Board members, is not standard practice in the sector as it may divert the charity’s funds away from its charitable mission and can lead to real and perceived conflict-of-interest problems. This practice is discouraged by sector trade groups which point to the Sarbanes-Oxley Act when they call for charities to refrain from making loans to directors and executives.”
So apparently, Nyquist’s loan is questionable from a legal standpoint, but it’s clearly wrong from an ethical and best practices standpoint. Also, it should be noted that this half-a-million-dollar loan was granted at a time when MBI was experiencing an acute financial crisis and cutting jobs.
Jenkins’ Use of the “Moody-Owned Apartment”
MBI’s statement about Trustee Jerry Jenkins’ use of the luxury apartment on the top floor of Jenkins Hall was telling not just for what it said, but for what it didn’t say. In response to the myriad of details I offered about Jenkins’ alleged inappropriate used of the apartment from 2000-2008, MBI offered one line of explanation: “Contrary to what some have said, the Moody-owned apartment was used by the Institute to host visits to campus by (Jenkins) as well as other Moody staff and guests.”
“Supposedly, MBI conducted an investigation into Jenkins’ use of the apartment and cleared Jenkins of any wrongdoing. However, I have repeatedly asked MBI to produce documentation of this investigation, but to date, MBI has failed to do so.”
I have now offered testimony from two former managers at Moody claiming first-hand knowledge that Jenkins took liberties with the apartment and treated it as his own. I also have corroborated these allegations with other former managers, who did not want to go on the record.
Supposedly, MBI conducted an investigation into Jenkins’ use of the apartment and cleared Jenkins of any wrongdoing. However, I have repeatedly asked MBI to produce documentation of this investigation, but to date, MBI has failed to do so.
Interestingly, it was only one business day after I sent emails to MBI executives and board members asking about Jenkins’ use of the apartment and the questionable loan to Nyquist that I was fired and MBI tried to seize my computer. If the institute had nothing to hide, it’s odd that it responded in this heavy-handed manner.
Also, firing an employee for blowing the whistle on suspected wrongdoing is illegal. According to Guidestar, “The (Sarbanes-Oxley) Act protects whistle blowers who risk their careers by reporting suspected illegal activities in the organization. It is illegal for a corporate entity—for-profit and nonprofit alike—to punish the whistle blower in any manner.” So if Moody wants to claim no wrongdoing, it not only must account for its financial dealings, but also for firing me for threatening to expose them.
Failing to Address Issues About Inerrancy & Theological Drift
In response to allegations that some Moody professors reject biblical inerrancy, Moody stated that “it grieves us that some of our faculty have been falsely accused of being in direct opposition to Moody’s stated beliefs and mission.” In addition Moody stated, “When an employee’s actions or beliefs regarding this doctrine are questioned, they are thoroughly examined and addressed in a timely and correct manner.”
This statement is false and MBI leaders know it.
As I wrote in an post published last week, two MBI professors hold a postmodern view of truth that rejects the common-sense claim that truth corresponds to reality. In other words, they do not believe that what the Bible says happened, necessarily happened.
These professors also reject the Chicago Statement on Inerrancy, a consensus document created by conservative scholars to defend inerrancy and signed by nearly 300 noted evangelical scholars. This statement also is the official definition of inerrancy held by the Evangelical Theological Society.
Moody administration is well aware of these professors’ views, and has been for more than a year. Yet rather than addressing the issue in a “timely and correct manner,” two Moody vice presidents refused a request by Theology Professor Rich Weber to clarify whether Moody’s definition of inerrancy is compatible with these professors’ views. Similarly, former President Paul Nyquist failed to clarify the issue when Weber appealed to him.
The professors with this postmodern view of truth and Scripture continue to teach at MBI and one has written theology curriculum for Moody Distance Learning. Weber, on the other hand, has been stripped of all his classroom responsibilities and is slated to be let go at the end of the semester.
Unfortunately, this failure of MBI leadership to address serious theological concerns, and seemingly censure those who raise them, is not isolated.
“Maybe Moody does want to be that open and have people who have those kinds of positions . . . But I don’t think it’s something that the administration wants to be publicly known.”
Zuber also said that he and two colleagues sent a letter to a Moody dean about another professor who “didn’t hold to some of the historical aspects of Genesis” and asserted that Peter didn’t write 2 Peter.
Both times, Zuber said the administration didn’t seem to take the complaints seriously. The dean responded with a letter saying he had talked to the professors in question and was satisfied with their answers, but didn’t offer any specifics. According to Zuber, the professors in question didn’t appear to have changed their positions.
“Maybe Moody does want to be that open and have people who have those kinds of positions,” Zuber said. “But I don’t think it’s something that the administration wants to be publicly known. And the more difficult part is the way that they handled it. It’s basically like . . . ‘We’ll handle it from here. Okay, we’re done.’ But was it done with a sanctified skepticism or, ‘Let’s see if we can brush this under the rug as quickly as possible’? I think the latter was how we felt it was done. . . . And subtly, it felt like having brought the concerns, it sort of made us suspect.”
Why the Change in Leadership?
These few examples are just a small sample of the mountain of disconcerting evidence that has been presented to trustees concerning issues at MBI. I know from talking to trustees in the weeks leading up to the shakeup in leadership that the failure of the previous administration to address these theological issues (and others) was a major concern for them. Yet now, MBI is denying that these issues ever existed, and I admit, I am profoundly confused.
However, as is evident in these accounts, the problems at MBI don’t just concern the top three leaders who stepped down, but extend to vice presidents and deans who remain at MBI. So the housecleaning not only needs to extend up to the board of trustees, but also down to VPs and deans. And this, I suspect, is the rub. People want to keep their positions, regardless of the cost to the institution. I sincerely hope this changes for the good of everyone involved.
Moody ended its statement with a call to prayer and unity, and I agree that for the sake of the gospel, that’s what is required. But unity requires dealing with sin, not denying it. So please MBI leadership, own and name your mistakes. And then let’s move on with a clean slate and fresh vision.