Gateway Church pledges to join ECFA, conduct forensic audit after lawsuit alleges financial fraud
Robert Morris’ embattled Gateway Church announced Sunday that they are now in the process of joining the Evangelical Council for Financial Accountability, an accreditation organization for many leading Christian nonprofits, and will undergo a forensic audit of their financials following the filing of a class action lawsuit Friday alleging leaders misappropriated millions of dollars in tithes meant for global missions.
“We are in the process of joining an organization called ECFA which stands for Evangelical Council for Financial Accountability,” longtime Gateway Church non-staff elder Tra Willbanks told congregants Sunday as he urged them to clap. “This will add an additional layer of accountability to our finances. ECFA has several requirements one of which includes publishing a financial overview to the church. We have been working on that … and we hope to publish something for you soon.”
The lawsuit which was filed by Gateway Church members Katherine Leach, Garry K. Leach, Mark Browder, and Terri Browder on Friday, names as defendants: Morris, Gateway Church, Tom Lane, a former executive pastor; founding elder Steve Dulin; and Kevin Grove, who serves as an executive global pastor and elder. It comes in the wake of growing tensions, and agitation from current and former Gateway Church members calling for increased transparency and accountability following Morris’ resignation in June over allegations of child sex abuse.
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The four church members allege that leaders of the church, which has generated in excess of $100 million in revenue annually in past years, failed to fulfill a pledge to allocated 15% of tithes to the church’s Global Ministries fund.
They further allege that Gateway Church used that pledge which remains highlighted on the church’s website, to encourage congregants to give money to fund ministries.
“The first 15% of Gateway's tithe is set aside to support local, national, and international outreach efforts. Your generosity helps provide resources for ministry partners and people in need around the world,” the church states on its website.
According to the lawsuit, Gateway Church hired a “seasoned” Certified Public Accountant to oversee the operations of Gateway Global Ministries with an expectation that the church would be giving away in excess of $10 million annually.
“That CPA was told that Gateway could really use his heart for missions to oversee with integrity the more-than-$10 million per year that Gateway was allegedly giving away,” the lawsuit explains.
Instead of being hired as an accountant in July 2011 however, Gateway Church made the CPA Executive Pastor of Global Ministries. He was charged with supervising six associate pastors and “vetting and approving relationships with gifts to ministry partners around the world.”
The CPA asserts that he would receive financial statements for the Global Ministries fund showing increases and outflows.
“When the CPA first began working for Gateway, its annual revenue was in the $100 million range and rose to about $120 million by 2014. However, during the CPA’s tenure in his executive pastoral role, he never observed the Global Ministries fund give away more than $3 million in any year,” the lawsuit says.
“In around 2013 the giving to missions had reached an estimated $20 million per year. Thus, depending on the year and the tithing, that meant that the unspent global fund balance was growing at approximately $10 million per year. In spite of that, Robert Morris and other leaders at Gateway misled the congregation during Global Impact Weekend each year by stating that the full amount was being given to missions when, in fact, it was not,” the church members claim.
When a member of the Global Ministries staff raised concern at one point about discrepancies in the fund balance and more than $1 million that was missing, Randy Bell, Gateway’s CFO, was unable to provide the CPA with a satisfactory response. It was only stated that Grove had approved the discrepancies.
When the CPA subsequently brought his concerns to Grove, the discussion allegedly became heated.
“The CPA scheduled a meeting with Kevin Grove the following day and approached him with the reconciliation errors. Kevin Grove became visibly enraged and, with a raised voice, instructed the CPA to ‘quit reconciling the accounts.’ Around this time period, the CPA began to find similar unexplained entries,” the lawsuit alleges.
The CPA later allegedly took his concerns to Tom Lane and threatened to resign if they weren’t addressed. When the CPA’s concerns were eventually brought to Morris as the church’s then senior pastor, Lane later told the CPA that he and Morris agreed to accept his resignation.
“Rather than practice transparent stewardship with one of its key pastors, who was hired to lead the directly relevant global ministry, the church ignored and buried his concerns,” the lawsuit alleges.
In his address to Gateway Church members on Sunday, Willbanks said several weeks ago, a former employee brought “several financial related issues to our attention that we felt needed further investigation.”
Willbanks said even though the allegations are a decade old, Gateway Church has asked Haynes and Boone LLP, the law firm already looking into how the church handled the child sex abuse allegations against Morris, to review the financial issues raised by the former employee.
“We take it seriously. To this point we have not been able to corroborate any of those specific allegations, but this work is still ongoing,” Willbanks said.
He said the church had planned to combine the inquiry into how the church handled the child sex abuse allegations against Morris as well as the investigation of the financial concerns into one report, but the filing of the lawsuit forced them to speak out earlier.
“Like other concerns that have been raised we are interested in learning the truth. If there is no wrongdoing here, we will tell you. If there is wrongdoing here, we will tell you and we will fix it. At this point, we are not aware of any financial wrongdoing, and we want you to know that we, your elders, and the church staff understand and embrace the sacred and biblical duty we have to steward the dollars given to Gateway,” Willbanks said.
The longtime Gateway Church elder said while the move to gain ECFA accreditation is the church’s push to respond to calls for increased transparency, it will take them some time.
“The ECFA application process does take some time, and they are wanting us to complete the Haynes and Boone inquiry prior to granting Gateway membership, which I believe is a fair ask. Additionally we do intend to publish our bylaws soon,” Willbanks said.
He said even though the church has always independently audited their financials, they intend on doing a forensic audit to address the specific claims in the in the lawsuit.
“Gateway has had independently audited financial statements since 2005. The firm who performs our audit is a nationally recognized auditing firm for nonprofit organizations. The name of that firm is Capin Crouse,” Willbanks said. “These audits have demonstrated that our finances are managed consistent with best practices, and we have never had any wrongdoing revealed through these audits.”
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