The Business of Church Music: Examining the Legal Structure of Worship Ministries and Practice of Pastors Operating as Music Producers

(Photo: Pastor Steven Furtick singing Psalm 121.)

Church music has become big business.

Ultimate Guitar reports that almost $600 million is spent annually on audio equipment and instruments for performing church music.”

Churches have become one of the most common venues for hearing live music.

In six years, Bethel Music, the music ministry of Bill Johnson’s megachurch Bethel Redding, generated $80 million in revenue.

Bethel Music is one of the four most popular church music ministries in America, according to a recent academic study being published at Worship Leader Research.

The researchers identified 38 of the most popular church worship songs from 2010 to 2020. Almost all the songs were written by or performed by Bethel, Elevation Church (pastored by Steven Furtick), Hillsong (founded by Australian pastor Brian Houston) and Passion City Church (pastored by Louie Giglio).

Church performances, concert tours and radio airplay have boosted worship band awareness. Hillsong has reportedly sold more than 20 million albums.

Business Legal Structure

Most American Christians have never heard of the term integrated auxiliary, but it is the key to understanding how most megachurches and televangelists operate financially successful worship ministries.

The IRS describes integrated auxiliaries as “a class of organizations that are related to a church or convention or association of churches, but are not such organizations themselves.”

For example, Elevation Church registered a trademark for the name Elevation Worship, the name of the worship band. This allows the church to create a bank account and do business in the name of Elevation Worship.

Continue reading “The Business of Church Music: Examining the Legal Structure of Worship Ministries and Practice of Pastors Operating as Music Producers”

Two Overlords and Two Gospels… American Churches Headed the Wrong Way

…with apologies to our friend Joseph Michael Bennett, who wrote a book we recommend, “Two Masters and Two Gospels” (2019).

Last week, multiple news sources reported a Lifeway Research study of 1,002 Protestant Christians strongly indicating that the “Prosperity Gospel” is rapidly rising in America.  These two beliefs go hand in hand to spread this heresy: 1) God wants Christians to prosper, attaining wealth and health and 2) God requires a gift from us humans before he will answer our prayers.

According to the well-crafted study, “Those who say their church teaches that God will bless them if they give more increased from 38% in 2017 to 52% in 2022.”—a huge increase over a short amount of time—and “76% believe that God wants them to prosper financially”, up from 69% in 2017—another rapid increase.

Lifeway Research’s methodology was an “online survey of 1,002 American Protestant churchgoers was conducted September 19-29, 2022, using a national pre-recruited panel.”  Comparisons were made to a 2017 online survey of 1,010 Protestants who attended religious services at least once a month.  They estimate that the “sample provides 95% confidence that the sampling error from the panel does not exceed +3.3%”

Prosperity Gospel Parallels the American Dream

If you believe in and think you deserve a share in the American Dream, then your beliefs are probably shared with a large segment of the U.S. public.  If you believe in the prosperity gospel—that God will multiply blessings upon those who richly bless Him with money, it appears you share that belief with a large majority of American Protestant Christians.

“The American dream is the belief that anyone, regardless of where they were born or what class they were born into, can attain their own version of success in a society in which upward mobility is possible for everyone. …(It’s) believed to be achieved through sacrifice, risk-taking, and hard work, rather than by chance.”—Investopedia

God helps those who help themselves” is a phrase that’s often mistaken as a scriptural quote.  More on Wikipedia

In some ways, the two beliefs have merged.

The only problem is that neither the Prosperity Gospel nor the American Dream “work”, especially for poor and disadvantaged people.  Both those lies wreak havoc with desperate people who are grasping at something, anything that might alleviate their suffering, even lottery tickets.  Some will be blessed by God materially, but most won’t be.

The “prosperity gospel” message panders to the sensual desire for riches but is the opposite of the message of the cross.  It’s a pious, pleasing message that avoids repentance from self-seeking.  Regarding piety… “The curse of a godless man can sound more pleasant in God’s ear than the Hallelujah of the pious”—Martin Luther (repeated by Dietrich Bonhoffer)

Consider Joel Osteen’s book, “Your Best Life Now” and other similar religious self-help books that ignore or cheapen the grace of Christ.

Jesus said, “If any man will come after me, let him deny himself, and take up his cross and follow me. For whosoever will save his life shall lose it; and whosoever will lose his life for my sake shall save it.”

The cross of Christ means the death of self.  For those of us who call ourselves believers, we prayerfully abandon control of our lives to God.

Signs that your church has embraced the lie of the prosperity gospel, sometimes ever so subtly:  the preacher’s mansions, luxury cars, private jets, and expensive clothing; the lack of transparency (read our article here) regarding the finances of the church; the lack of accountability (he or she answers to no one), i.e., nobody can hire or fire the pastor (read here).

The sin of greed thrives in a climate of secrecy. Therefore, we believe that churches should be required to make their finances available publicly—read about “dark money” in the church here.

Televangelist Jesse Duplantis: $500 Million Is Not Enough

Jesse Duplantis has stage presence. Before he became a preacher, Jesse Duplantis performed in a touring rock band. By combining the prosperity gospel and comedy, televangelist Jesse Duplantis has built a large following.

Early this month Duplantis preached at the annual Southwest Believers Convention hosted in Fort Worth, Texas, by televangelist Kenneth Copeland.

Duplantis has a knack for saying controversial things and telling wild stories. In his sermon Vision Creates Direction, Duplantis preached, “I never ask God for a need. What a waste of spiritual energy. That’s the dumbest thing I’ve ever heard of in my life.”

Duplantis uses a mafia character voice to say, “I know how to get rid of people… You do what you gotta do.” Duplantis would later tell the audience that a mafia boss offered to make him “a made-man”—a fully initiated member of the mafia.

Duplantis enjoys talking about his wealth. “You are looking at one rich puppy here. I’m not being arrogant. I’m telling you one thing. You have no idea.”

During its 43 years of operation, donors have contributed hundreds of millions of dollars to Jesse Duplantis Ministries. Duplantis claims his ministry received $500 million in response to prayers.

“I thought I could save the world with a hundred million dollars. So, I went to the throne of God. He said, ‘What do you want, Jesse?’ He didn’t ask what I need. He’s never asked what I need… ‘I said, Lord, I need a hundred million dollars.’ I said, ‘I can touch the world for a hundred million dollars.’ He said, ‘Done.’ Gave me a hundred million dollars… Well, I ran out of money, so I went back to the throne. I said, ‘Jesus.’ He said, ‘You need another hundred million. I said, ‘Yeah.’ He gave me another hundred million.”

Duplantis says that a third time God gave Duplantis’ ministry $100 million, and it was all spent in nine months. Eventually he would ask five times and God would give his ministry $500 million. It still was “not enough to touch the world.”

The first century Church could teach Duplantis some valuable lessons. With limited financial means and no modern technology, they “turned the world upside down.”  – Acts 17:6 KJV

This amazing church growth happened without the prosperity gospel.

Bible Verses Prosperity Gospel Preachers Ignore

The prosperity gospel has created a distorted view of what the Bible teaches about money, resulting in many church goers being misled to believe that God wants His people to be financially wealthy.

Instead, the Bible presents a balanced view: Times of abundance and times of scarcity both come from God. This principle is shown in Genesis 41, as God gives Pharaoh, the leader of Egypt, a prophetic dream, revealing the land would have seven years of abundance followed by seven years of famine.

This balance is clearly taught in Ecclesiastes 7:14 which says, In the day of prosperity be joyful, and in the day of adversity consider: God has made the one as well as the other, so that man may not find out anything that will be after him.”

God desires our faithfulness rather than financial success. These difficult times test our faith so that it may grow.

The Bible also teaches that sometimes people will “sow, but not reap.” In Micah chapter 6, God is upset with criminals committing fraud and condemns the merchants using dishonest scales. When dishonesty is used for financial gain, God will refuse to bless the evildoer.

Micah 6:15 says, “You shall sow, but not reap; you shall tread olives, but not anoint yourselves with oil; you shall tread grapes, but not drink wine.”

When people pray with selfish motives, God will reject their prayers as James 4:3 shows, “When you ask, you do not receive, because you ask with wrong motives, that you may spend what you get on your pleasures.”

Another relatively unknown Bible verse that challenges the prosperity gospel is found in Proverbs 22:16.  “One who oppresses the poor to increase his wealth and one who gives gifts to the rich—both come to poverty.”

Numerous churchgoers and viewers of religious television have sacrificially given to preachers misusing donations for personal gain. If Christians would stop financially supporting rich televangelists and pastors living extravagantly, there would be less poverty and Christianity would have more credibility in a broken world.

NOTE: These verses come from multiple translations (ESV and NIV)

Whistleblowers, Thank You for Your Service

Today is National Whistleblower Day.

Whistleblowers perform a valuable, but poorly understood, service for humanity by exposing crimes and misconduct in multiple ways:

  1. Privately and publicly confronting business, religious and political leaders who’ve abused their power.
  2. Filing criminal charges.
  3. Providing tips to law enforcement.
  4. Providing tips or interviews to journalists.
  5. Suing the perpetrators.
  6. Writing first-hand accounts in blog posts and books telling the story of their experiences of abuse and eye-witness accounts of fraud.
  7. Telling their stories in podcasts and documentaries.
  8. Helping other victims recover from similar experiences.

The whistleblowers’ actions expose sin, demand justice and educate the public.

Ephesians 5:11 provides a biblical mandate for whistleblowing and investigative reporting: “Have nothing to do with the fruitless deeds of darkness, but rather expose them.”

On this National Whistleblower Day, Trinity Foundation would like to thank every public whistleblower and anonymous informant that has contacted us. Your tips help us investigate church and ministry corruption.

According to Stephen Martin Kohn, founder of the National Whistleblower Center, and author of The New Whistleblower’s Handbook, tipsters uncover more fraud than professional auditors and law enforcement combined.

We would also like to thank our donors for your support. You’ve equipped us to serve the public for more than three decades as a religious watchdog and third-party whistleblower.

We are currently working on several big investigations and look forward to sharing them with you when the time is right.

How Religious TV Networks and Magazine Publishers Report Taxable Advertising Revenue

American tax laws require advertising revenue exceeding $1,000 to be reported by non-profit ministries and churches. However, some organizations fail to report unrelated business income because of either not knowing the law or purposefully restructuring themselves to avoid disclosure.

In recent years some religious TV broadcasters have begun to distance themselves from the high pressure beg-a-thon fundraisers of the past and are adopting the new business model of Free Ad Supported Television (often identified by the acronym FAST.)

The Inspirational Network, a non-profit organization operating the INSP cable network, is the leader in this transformation, having generated hundreds of millions of dollars or more in advertising revenue that has been unreported since 2014 on its Form 990s.

The Inspirational Network was the recent subject of a Trinity Foundation investigation into unreported advertising revenue and excessive compensation.

Which raises the question, how do other religious non-profits report  advertising?

In 2021, Christianity Today International reported almost $2.9 million in advertising revenue of which $637,199 was unrelated business revenue.

(Screenshot: Christianity Today International 2021 Form 990, page 9.)

Meanwhile, God’s World Publications (the publisher of World Magazine) reported all its advertising revenue ($1,543,326 for fiscal year ending June 30, 2021) as unrelated business income.

Continue reading “How Religious TV Networks and Magazine Publishers Report Taxable Advertising Revenue”

Word Network Airs Dead Convicted Statutory Rapist Tony Alamo and Other Ex-Cons, Jim Whittington, and WV Grant

Three ex-con televangelists, including one now deceased, all have compared themselves to the Apostle Paul of the early church… you be the judge.

Tony Alamo AP Photo, Evan Lewis, November 13, 2009

Tony Alamo is dead

Tony Alamo’s boring half hour program currently is broadcast three times weekly on the Word Network: Tuesday’s at 7:30 pm and Thursdays at 3:30 am and 11:30 pm.

Alamo once lived in a lavish, 13,064-square foot mansion with a heart-shaped swimming pool; his ministry once had thousands of followers; and he operated many for-profit businesses.  One of his businesses sold custom-made sequined jackets to celebrities such as Elvis Presley, Michael Jackson, and Mr. T., but that was before he was convicted of income tax evasion and “marrying” underage girls.

He was sentenced to prison twice—175 years the second time in November 2009.

Mr. Alamo was accused of taking young girls across state lines for sex and arrested in October 2008. Five women ranging from age 17 to 33 told jurors that Alamo “married” them in private ceremonies while they were minors, sometimes giving them wedding rings. Each described trips beyond Arkansas’ borders for Alamo’s sexual gratification.[1]

Alamo believed that young girls were fit for marriage. “Consent is puberty,” he told The Associated Press in 2008.[2]  A CNN news clip of his arrest includes audio of Alamo stating that women as young as twelve are ready for marriage as soon as they start their period.[3]

“I’m just another one of the prophets that went to jail for the Gospel,” Alamo called out to reporters afterward as he was escorted to a waiting U.S. marshal’s vehicle.[4]

A jury convicted Alamo in July 2009 of 10 counts spanning 11 years and on November 13, 2009, federal Judge Harry F. Barnes sentenced him to the maximum on each count, for a total of 175 years in prison.[5]

He died in a federal prison hospital in North Carolina in May 2017.

More of Alamo’s Legal Encounters

The Southern Poverty Law Center reported that “Alamo was arrested on a felony child abuse charge in 1989, but it was dismissed six years later. The case involved an 11-year-old boy who was given 140 blows at Alamo’s directions for minor academic infractions. His family later filed suit and won a $1.4 million judgment against Alamo and his ministry.”[6]

Federal agents raided his properties in 1991 when he owed $7.9 million in taxes.  He was convicted in 1994 of income tax evasion, served four years in prison, was released in 1998, and went back to his Arkansas-based ministry.

In addition to the criminal convictions, Alamo was found liable in a federal civil trial and ordered to pay $30 million to two men who were raised in the controversial Tony Alamo Christian Ministries. A jury found that those two men were beaten, starved, and denied education and found Alamo liable for conspiracy, outrage and battery.[7]

Another civil judgement was even more telling.  Seven women who were victims of physical and sexual abuse brought civil suits, resulting in a $525 million judgment, the largest in Arkansas history.[8]

Continue reading “Word Network Airs Dead Convicted Statutory Rapist Tony Alamo and Other Ex-Cons, Jim Whittington, and WV Grant”

Secular in the Daytime, Prosperity Gospel at Night; How Religious Non-Profit Network INSP Became a TV Ratings Phenomenon

Barry Bowen and Pete Evans

(Time to read: 20+ minutes)

(Photo: INSP logo appearing in network promo.)
After many years of investigating The Inspirational Network and its CEO David Cerullo, reviewing 21 years of the non-profit’s Form 990 filings with the IRS, conducting numerous corporation searches for related entities, watching INSP cable TV programming, and monitoring private jets used by the Cerullo family, we still have more questions than answers.

In 2009, the Charlotte Observer reported, “With compensation exceeding $1.5 million a year, Cerullo is the best-paid leader of any religious charity tracked by watchdog groups.”

Fourteen years later, Cerullo retains the position of highest paid executive in MinistryWatch’s 100 Highly Paid Ministry Executives list.

Over the past decade, Trinity Foundation, Inc. (TFI) investigators have examined hundreds of Form 990 informational returns of religious non-profits and have found no one that received more compensation in one year than Cerullo in 2019: $7 million.

The staggering compensation motivated TFI to dig deeper to attempt to follow the advertising revenue money but were thwarted by a confusing web of financial disclosures, Delaware corporations, LLC’s with scant information, etc.

To be fair, the highly successful TV network says it does in fact report and pay its share of corporate taxes on its TV ad revenue.

Yet for almost ten years, The Inspirational Network, Inc. has declined to report advertising revenue on 990s earned by its for-profit subsidiaries and in fact claims it is not required to.

Why this would matter if they weren’t paying corporate taxes: Non-profit organizations are required to report unrelated business income over $1,000 on a Form 990-T and pay taxes on this income. Before 2018, the tax on unrelated business income ranged from 15 to 35 percent. The Tax Cuts and Jobs Act of 2017 changed the new tax rate to 21 percent.

A for-profit subsidiary of The Inspirational Network, Inc. can separately pay taxes on advertising revenue, but these subsidiaries must be listed as a related organization on The Inspirational Network 990s—and Cerullo’s non-profit currently fails to disclose that INSP, LLC is a related organization.

Continue reading “Secular in the Daytime, Prosperity Gospel at Night; How Religious Non-Profit Network INSP Became a TV Ratings Phenomenon”

The Legacy of Pat Robertson

Televangelist Pat Robertson has died, leaving behind a complicated legacy.

The Christian Broadcasting Network (CBN), the TV network Robertson founded in 1960, broke the news this morning.

Robertson also helped found the international disaster relief agency Operation Blessing, Regent University and the American Center for Law and Justice.

According to the Associated Press, “One of Robertson’s innovations was to use the secular talk-show format on the network’s flagship show, the ‘700 Club,’ which grew out of a telethon when Robertson asked 700 viewers for monthly $10 contributions.” His talk show format “His guests eventually included several U.S. presidents — Jimmy Carter, Ronald Reagan and Donald Trump.”

The 700 Club helped mainstream the Charismatic/Pentecostal movement in America.

As host of the 700 Club, Robertson gave so-called words of knowledge and spoke prophecies that went unfulfilled. Robertson told his viewers, “I guarantee you by the fall of 1982 there is going to be a judgment on the world.”

For 2007, Robertson prophesied, “There will be some very serious terrorist attacks.” Robertson, elaborated, “The Lord didn’t say nuclear, but I do believe it’ll be something like that – that’ll be a mass killing, possibly millions of people, major cities injured.”

Robertson promoted political positions and politicians associated with the Religious Right, culminating in his founding the Christian Coalition in 1987 and 1988 political campaign.

Non-profit funds were misused to advance Roberton’s political ambitions.

The New York Times reported, “During 1985 and 1986, the network gave $250,000 a month or more to the tax-exempt Freedom Council to mobilize Christian voters behind Mr. Robertson’s candidacy for the Republican Presidential nomination in 1988. By some estimates, as much as $8.5 million was funneled to the Freedom Council in this fashion.”

Continue reading “The Legacy of Pat Robertson”

Growing Rich from Ministry: Apostle Chuck Pierce and Family Receive $4 Million Compensation

On Friday, ProPublica published a large batch of Form 990s, the informational return non-profits file with the IRS. Some of the latest 990s show a disturbing trend of excessive compensation at large media ministries. For example, Glory of Zion International’s 990 reveals more than $4 million were paid to the Pierce family. Trinity Foundation will disclose more examples in future articles.

During Covid, the IRS fell far behind in processing the 990s which disclose total revenue, total expenses, compensation for non-profit executives, and other information helpful for donors analyzing the effectiveness of American charities.

When MinistryWatch published its latest Highly Compensated Ministry Executives list in January, Apostle Chuck Pierce was ranked 4th due to receiving $1,774,051 in compensation during the fiscal year ending March 31, 2021. Pierce would rank 3rd based on the new 990 which discloses $2,084,437 in compensation.

(Screenshot: Charles “Chuck” Pierce preaching.)

Congress created a tax penalty for non-profit organizations that provide excessive compensation to employees. Pierce exploits a loophole in the law which exempts clergy from the excise tax. Page 5 line 15 of the 990 shows the ministry is not subject to the 4960 excise tax on excessive compensation which is defined as compensation of more than $1 million.

(Spreadsheet: Pierce family compensation compiled from 990 for fiscal year ending March 31, 2022.)

Trinity Foundation encourages donors to boycott non-profit organizations paying exorbitant salaries to executives.