Fraud and other moral disasters occur in the nonprofit world

You may think local churches are immune to scandals.  In your ministry, perhaps you feel that since you are staffed by sold-out followers of Christ who are passionately committed to your mission, you won’t have any of those kinds of problems.  

Allow me to share some of my experiences. The vast majority of my work experience has been in the religious nonprofit community, which includes both churches and parachurch ministries. CPAs now study and analyze fraud situations so we may better detect them when performing audits (at least we hope we are better at it now than in the past).  A while back, I prepared a tally of all the frauds, moral failures, internal thefts, tax frauds, and similar disasters I am aware of based on the knowledge I have gained while providing professional services to my clients.  To clarify, this does not include what others tell me or what I read in the paper.

Based on what I have personally seen over the last 20-plus years, I estimate that approximately one out of seven Christian organizations has suffered a severe ethical failure.  The types of incidents include moral failure (a category which now includes accessing Internet pornography), significant internal theft, outright tax fraud, or “cooking” of the books.  I have no reason to believe that the level of incidents I have personally observed are any different from the level of similar traumas taking place throughout the religious nonprofit community.

Media visibility — Of the moral failures I know about, over half did not hit the papers.  Of the internal theft or book-cooking incidents, I am not aware of any that have become public knowledge.

My hope is that these comments open your eyes to understand that ethical failures affect even the church and ministry world. Those disasters are more common than you realize.

There is much more to say.  In the meantime, please use this information as motivation to improve the internal controls in your organization.

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