Australian megachurch Hillsong, facing leadership scandals and allegations of financial misdeeds, has embraced a defense strategy remarkably like American televangelists facing investigations and court challenges.

Hillsong’s responses to allegations can be summarized as …

1. Deny problems exist.
2. Create churches as limited liability companies as part of a risk containment strategy. Individual churches are overseen by managers.
3. Threaten to sue critics.
4. After indisputable evidence emerges, confess, or admit that mistakes have been made.
5. Request prayer for fallen leaders.
6. Acquire expert legal advice.
7. Make personnel and board changes.
8. Experts release a report denying systemic problems exist.

Hillsong History

In 1983, Brian Houston founded Hills Christian Life Centre. The church would become Hillsong.

Actions taken by Houston more than twenty years ago still haunt the organization. In 1999, Houston learned his father Frank Houston had committed sexual abuse of children but failed to report the criminal behavior to law enforcement. Houston is currently on trial for the failure to report, with a decision expected this year.

In 2019, Hillsong threatened to sue news media for publishing articles critical of Houston:

“Much of this commentary is factually incorrect and highly defamatory, and we call on the media and others to immediately stop making these spurious claims. We have directed our lawyers to review several articles that have published untrue and defamatory claims that smear Pastor Brian’s reputation as a Christian leader. Furthermore, we remind those who seek to spread rumours and baseless information via social media that these comments may also be subject to a defamation action.”

Houston embraced the prosperity gospel and in 2000 he authored the book You Need More Money.

Hillsong began to expand internationally. In 2010, Hillsong Ministries USA, Inc. was incorporated. The articles of incorporation stated, “The Corporation shall have no members.”

On the advice of attorneys such as Stephen Lentz, the father of Carl Lentz, Hillsong would form affiliated churches in America as limited liability companies (LLCs).  Stephen Lentz is a leading advocate for churches to use LLCs as part of a risk containment strategy and describes this strategy in his book The Business of Church.

In 2020, Hillsong fired celebrity pastor Carl Lentz who led the church’s New York City congregation. After the firing, Houston responded, “I’m acknowledging that mistakes have been made and that there are things where we need to get far better, much better. I’m not shrinking back from that.”

Continue reading “Church Defense Strategy: Hillsong Responds to Allegations and Government Investigation”

Researchers at the Center for the Study of Global Christianity, writing for the International Bulletin of Mission Research, estimate that $55 billion will be spent on foreign missions in 2023. That may seem like a lot, but the same researchers also estimate that Christian religious leaders will embezzle $62 billion in 2023.

Foreign mission organizations are notorious for their lack of transparency. Gospel for Asia, which raises millions of dollars to support missionaries,  doesn’t disclose to donors important financial information such as total annual revenue, total annual expenses or compensation for highly paid executives.

Compounding the problem, American tax laws are poorly understood and poorly enforced, often resulting in noncompliance. If a church operates a mission project in a foreign nation with a foreign bank account and the foreign account exceeds $10,000, the church is required by the Bank Secrecy Act to file a Report of Foreign Bank and Financial Accounts (FBAR).

To make matters worse, if a church or ministry reports a foreign bank account, the report is confidential and cannot be revealed to church or ministry donors. Corrupt religious leaders can engage in international money laundering and the existence of their foreign bank accounts are shielded by privacy laws.

Australian Charity Rules

Some countries such as Australia have stricter laws regarding foreign reporting and foreign expenditures for churches.

In 2022, Hillsong Church employee Natalie Moses turned whistleblower. Moses served as Fundraising & Governance Coordinator for Hillsong Global Corporate Group.

According to Moses’ statement of claim, Brian Houston, the founder and former senior pastor of Hillsong “announced that $10,000 would be given to persons who were his former interns and who had sought to start a ‘Hillsong’ Church in Bucharest, Romania.”

Moses responded by informing a supervisor the direct cash payments to individuals in Romania by Australian non-profit organizations was prohibited.

To avoid violating Australian law, Hillsong Global LLC (an American non-profit limited liability company) transferred the funds. Meanwhile, Hillsong Global does not file a Form 990 disclosing its foreign spending because American churches and church integrated auxiliaries are exempted from filing the non-profit information return.

Moses raised additional concerns that Hillsong was failing to comply with Australian laws.

Australia has adopted Four External Standards which regulate foreign non-profit spending and reporting. Australian churches are not exempt from these standards.

The Australian Charities and Not-for-Profits Commission requires foreign financial records to be “complete, accurate and legible.” Australian churches and ministries should compile a list of all foreign third-party organizations they collaborate with. Non-profit organizations are expected to document criminal and illegal activities committed by employees after misconduct is discovered.

Unfortunately for Australian Christians, these complete records are not available for church donors. Instead, they must be made available to government officials that request them.

The Australian Charities and Not-for-Profits Commission provides basic financial information for Australian churches and ministries, but good luck finding Hillsong Church’s foreign missions expenditures.

(Photo: Hillsong Church Ltd. reporting no foreign expenditures for 2021.)

Continue reading “Foreign Financial Reporting: When Church and Ministry Money Travels to Foreign Countries”