Gospel for Asia has responded after the Indian government accused its partner ministry, Believers Eastern Church, and leader Bishop K.P. Yohannan of "siphoning out" tax-exempted funds for "personal and other illegal expenses."

"Believers Eastern Church, and its over 50 dioceses in India, are cooperating with the Indian government as they conduct a review of the ministry's activities throughout the nation," BEC spokesperson Fr. Sijo Pandapallil said in a statement to The Christian Post.

"The inquiry, conducted by the income tax department, began last week during an unannounced visit; unfortunately, the visit was wildly mischaracterized on social media."

Pandapallil requested that people "not spread false information that can damage the good work the church is doing for the uplifting of the poor and needy, especially during this COVID-19 season."

He added: "We believe our government will continue to help us to do more to uplift the poor and needy, just as we have always done." 

Last Friday, the Indian Ministry of Finance released a statement saying that it had carried out search and seizure operations "in the case of a well-known self-styled evangelist of Thiruvalla in Kerala and his group of various trusts that enjoy exemption under the Income-tax Act, 1961 as charitable/religious trusts."

In the week leading up to the government's statement, India-based media reported that government agents had raided offices and facilities connected with the Thiruvalla-based BEC, an evangelical denomination founded by the U.S.-based organization Gospel for Asia in 1993 and now claims nearly 4 million members in 16 countries. BEC runs several churches, schools and a medical college.

The media reports, which GFA considered to be "based on exaggerated rumors," suggested that officers attributed the raids to allegations of tax evasion and the group's receiving of unauthorized foreign funds.

In its statement, the ministry of finance clarified that search operations conducted by the Income Tax Department covered 66 different premises located in Kerala, Tamilnadu, West Bengal, Karnataka, Chandigarh, Punjab and Telangana.

"The searches were carried out as credible information was received that the group has received donations from foreign countries ostensibly for helping the poor and the destitute and for evangelical purposes, but was actually siphoning out such tax-exempted funds in cash to engage in unaccounted cash transactions for personal and other illegal expenses in real estate transactions," the Nov. 6 statement reads.

The finance ministry reported that the group operates 30 trusts that are registered nationwide and alleged that "most of them exist only on paper and have been found to be used for routing the unaccounted funds and for accommodation transactions."

"It has been found that the modus operandi of the group is to systematically inflate expenses with the help of other parties, who would return the inflated amount in cash through domestic hawala channels to the functionaries of the group," the government said.

"Some of these other parties were also covered in the search action. During the search action, evidences have been found of systematic inflation of expenses in purchase of consumables, construction expenses, real estate development expenses, payment of salary, etc."

The government also claimed that the search led to the "unearthing of a number of real estate transactions involving unaccounted cash payments" and led to the seizure of related documents and sale agreements.

"The group has also inflated the price in real estate transactions to show as if the money received in donations is being spent on the activities of the trusts," the government added. "The evidence found so far indicate that the siphoning of funds in cash may be running into hundreds of crores of rupees."

According to the Indian Ministry of Finance, "unexplained cash" equivalent to over $800,000 was found during the searches, including over $500,000 that was discovered in a place of worship in Delhi.

The government's investigation is ongoing.

GFA, which is headed by Yohannan, sent The Christian Post a statement last week, stating that media reports of the allegations against BEC were "thinly sourced and unsubstantiated."

While GFA is a separate legal entity, it said that the allegations were part of an "ongoing smear campaign targeting the ministry by those who are opposed to BEC's mission in Asia."

Pandapallil explained in his statement that one of the questions asked of church leaders was related to "whether the ministry had used foreign funds to facilitate religious conversion in India."

"Based on the information given to us by government officials, it will take at least two months before their official analysis has been conducted," Pandapallil explained.

"We welcome the government's review and have assured its officials that should they identify any irregularities or wrongdoing on the ministry's part that we will immediately correct it."

The allegations against BEC come after the government in India, led by the Hindu nationalist Bharatiya Janata Party, has in recent years revoked the licenses of BEC, Compassion International and several other Christian organizations that allowed them to legally accept foreign donations. Effectively, those groups can no longer receive foreign donations under the Foreign Contribution Regulation Act.

GFA asserted in its statement last week that BEC "refutes all allegations that there have been any violations of government regulations regarding foreign funding."

"They have told us they are in compliance with India's rules and regulations regarding funding and will continue to comply as the law is written," GFA said.

The Hindu reports that Pandapallil published a video message on Monday in which he said the church will be subject to an audit.

"If the I-T authorities point out mistakes, they will [be] rectified through discussions within the Church Episcopal Council," he said.

The Yohannan-led GFA has in the past been accused of mishandling donations.

In 2019, the organization reached a $37 million legal settlement related to allegations that the charity used donations earmarked for charitable purposes within its mission fields to build personal residences and a headquarters in Texas.

Yohannan has maintained that the group did not act fraudulently.

In 2015, the Evangelical Council for Financial Accountability cut its ties with GFA after warning about concerns related to the withholding of hundreds of millions of donor dollars earmarked for "urgent" work overseas.

A $170-million class-action lawsuit was filed against GFA in Canada this year, alleging among concerns that the charity "defrauded or made negligent misstatements" to donors and "civilly conspired to misrepresent the nature of donations collected." The lawsuit alleges that instead of "urgent" donations being used in the field, funds were sitting in foreign bank accounts.

This week, GFA representatives pointed to details posted online by GFA regarding the 2019 legal settlement.

"Yes, all your donations to Gospel for Asia that were designated for mission field work were sent to the field," the document reads.

"The settlement agreement clearly states in section 9.2.2: 'The Parties also mutually stipulate that all donations designated for use in the field were ultimately sent to the field.' During the legal proceedings, we retained one of America's big four accounting firms to conduct an objective analysis of the flow of Gospel for Asia funds to the field. They concluded that all the money given made it to the field — a conclusion we knew to be true from the very beginning."

Popular preacher and author Francis Chan, who has served as a GFA board member since 2015, has also gone to bat for the organization and Yohannan.

When the allegations were pressed against GFA in 2015, Chan said he traveled to its Texas headquarters and the mission field in India with a trusted financial expert who is a partner with a large accounting firm. Chan also reviewed tax returns from Yohannan and his son.

"After careful research, our conclusion was that there was no money misappropriated and that all funds were channeled to the intended areas," Chan assured in a 2019 statement.

Courtesy of The Christian Post.