(Photo: The Word Network appeals primarily to African American audiences.)
The United States has filed a lawsuit in federal court, attempting to seize Word Network president Kevin Adell’s $4.4 million Bloomfield Hills, Michigan-home, alleging the radio and TV broadcaster owes almost $18 million in estate and gift taxes, following the death of his father, Franklin Adell in 2006.
The case has received little news coverage outside of Michigan. The Detroit Free Press and Crain’s Detroit Business have covered the story. Journalists reporting on Adell’s legal problems have missed a bigger story: Adell has exploited a loophole in the law, crafted for churches, to avoid disclosing millions of dollars in compensation.
Who is Kevin Adell?
(Screenshot: Kevin Adell being interviewed following Novi city council approval to build the Adell Center.)
Kevin Adell is a broadcaster and serial entrepreneur involved in commercial real estate development. In addition to operating The Word Network, Adell owns talk radio station WFDF and WADL-TV, but not for much longer, as the pending sale of the TV station was announced May 17th and Wikipedia reports the sale price at $75 million.
Adell constructed the $125 million Adell Center, a business complex in Novi, Michigan, featuring restaurants, shops and indoor skydiving.
Adell also owns a massive car collection. In 2019, Hagerty Media revealed that Adell had a “fleet of 100 or so automobiles—plus one special tractor.” Adell is reportedly the only American owner of a Lamborghini Nitro 130 T4i tractor.
Adell’s collection features iconic vehicles from TV shows and movies. According to Hagerty, Adell “owns one Batmobile, one Bat motorcycle, the General Lee Dodge Charger from ‘The Dukes of Hazzard’ (minus its rebel flag), Burt Reynolds’ Trans Am from ‘Smokey and the Bandit,’ and the faux Ferrari 250GT California Spyder launched off a balcony in ‘Ferris Bueller’s Day Off.'”
The case United States of America v. Adell et al was filed on April 24th. According to the complaint, when Franklin Adell died, he left a “gross estate valued at $32,930,891.”
The lawsuit alleges that Kevin Adell owes $9,775,326.65 in unpaid estate taxes and $8,178,714.47 in unpaid gift taxes. The lawsuit claims, “Kevin Adell dissipated the Adell Estate’s assets and knowingly and willfully failed to pay the estate tax liabilities the Adell Estate owed to the United States.”
Four years before he died, Franklin created the Franklin Z. Adell Trust to hold assets accumulated throughout his business career such as STN.Com, Inc., a for-profit company, handling the satellite broadcasting of The Word Network.
The Franklin Z. Adell Trust also owns an 8,433 square-foot home registered to Orchard Lake Property Trust, which the United States is attempting to seize to pay off some of the owed taxes.
An Extravagant Lifestyle
If the United States wins its court case and seizes the $4.4 million home, Adell will not be homeless. Kevin and his wife Joelle own additional houses in Michigan, Florida, and Utah.
The Adells own more than 100 acres of land in Michigan. According to real estate website Zillow, the Adells’ home in Metamora and surrounding land are worth almost $3 million.
The Adells’ waterfront home in Naples, Florida, is located not far from the Naples Yacht Club, and is worth $6.8 million, according to the Redfin real estate website.
(Photo: Satellite view of Naples Yacht Club and nearby homes.)
The Adells also own a mountain home close to the Sundance Film Festival, which Redfin estimates to be worth $5.7 million.
Accumulation of Wealth Through Religious Broadcasting
Unlike most religious TV networks, The Word Network was founded by an entrepreneurial, secular broadcaster instead of a preacher. Franklin Adell, then-owner of WADL-TV, incorporated World Religious Relief, the original parent organization of The Word Network in 1999.
The Word Network grew rapidly to become America’s fourth or fifth largest religious cable TV network, whose ranking depends on if INSP is classified as a religious TV network.
In 2015, the IRS revoked World Religious Relief’s tax-exempt status, following an audit. News media failed to report the revocation as it was announced in an IRS Bulletin. A tax lien was filed against World Religious Relief for $3.7 million.
(Photo: Tax lien filed against World Religious Relief in Oakland County, Michigan.)
World Religious Relief’s name was fraudulent. According to the organization’s 990s, the non-profit frequently failed to provide any financial relief.
During the fiscal year ending May 31, 2012, World Religious Relief generated $18.2 million in revenue. As the following picture shows, the non-profit provided no grants or financial assistance to individuals.
World Religious Relief’s 990s reported no unrelated business income. What should have served as a big red flag to any donors checking the 990s, the organization reportedly had only one employee—Kevin Adell.
After his father died, Kevin developed a scheme to enrich himself through large compensation payments involving self-dealing.
Self-dealing occurs when the officer of a non-profit organization also operates a for-profit company, and the two entities do business with each other. It may become illegal when the officer excessively profits off the non-profit organization.
Adell used the companies STN.com and International Broadcasting Corp. to provide the broadcast and TV production services for Word Network.
In one year, $15.1 million out of $18.2 million in revenue was diverted to the Adell-operated International Broadcasting Corp. which provided services as an independent contractor.
During the final five years World Religious Relief filed 990s, Adell received $1,610,964 in compensation from the non-profit organization and $21,582,038 from his related companies.
(Photo: Adell received almost $5.5 million in one year from World Religious Relief and related organizations.)
Trinity Foundation estimates that since 2008, Adell has received more than $60 million in compensation from Church of the Word and related organizations.
When the IRS began auditing World Religious Relief, Adell hatched a backup plan. He incorporated Church of the Word and registered to it the trade name Word Network Church.
Adell also incorporated Word Network Operating Co. in Delaware which then registered a trademark for Word Network Church.
Therefore, a non-profit organization and for-profit corporation are both using the name Word Network Church. Trinity Foundation calls this practice the Same Name Game.
By setting up a church, Adells’ new non-profit could legally avoid filing a 990. The Word Network eliminated all financial transparency. Adell’s compensation from related organizations would no longer be disclosed. Donors to The Word Network would lack financial information to make informed donor decisions.
Failure of Government Oversight
Eight years have passed since the IRS revoked World Religious Relief’s tax-exempt status. During these years, the IRS has taken what looks like a hands-off approach to investigating/prosecuting religious fraud as the government has not revoked the tax-exempt status of any large religious non-profit organizations.
In the past ten years only one televangelist has been criminally prosecuted for tax evasion. Todd Coontz is scheduled to be released from prison in 2024. The IRS has refused to revoke the tax-exempt status of Coontz’s non-profit Rockwealth International Church despite multiple requests from Trinity Foundation on behalf of unwitting donors.
Meanwhile, the current case against Adell is civil, not criminal.
In 2015, Trinity Foundation submitted an investigative report to the IRS recommending the revocation of Church of the Word’s tax-exempt status.
Because of the 1974 Privacy Act, the IRS is unable to provide status reports of any ongoing investigation or audit. The privacy law should be amended to allow for status updates to be available, to expand information available in the public interest.
Because The Word Network describes itself as a church, a Trinity Foundation investigator called Word Network in 2017 to inquire about visiting the church and was told, “Well, you know that this is not a church, right? It’s a broadcasting network with a prayer center in the back.”
The IRS needs to account for its operational failures. A Congressional oversight committee should question the IRS Commissioner regarding quite a few laws and loopholes being exploited by religious organizations as there are numerous ministries, which are not churches, failing to file a Form 990.
Congress should also ask how long it will take for the IRS to catch up on processing 990s as there is a large backlog of informational returns waiting to be processed and made available to the public.