Five things to do when you suspect impropriety in your church's finances

I occasionally receive comments and emails from readers, always laypeople, who are concerned about improper or inappropriate financial matters in their local church. These are mostly well-meaning folks who have read some of my several dozen articles on the housing allowance, clergy compensation, or church finances and recognize some things are not right in their own church.

So, what should laypeople do when they are concerned about their church's handling of financial matters?

1. Don't be embarrassed about asking questions of church leaders, church finance committee members, deacons or whomever is in charge of this aspect of church administration.

There is a difference in church size here. If you are in a megachurch or large church, my sense is that your concern is unlikely to be welcomed. But most SBC churches have a single clergy staff (the pastor) and may have a full or part time administrative assistant and members are likely to have some forum or practice where they can ask financial questions.

If you have a question about the periodic financial report or budget ask the appropriate person at the appropriate time. It's your church as much as it is the deacon's, pastor, finance committee or staff and you should not hesitate to ask honest questions. Just don't buttonhole the pastor in the hallway before worship or come to be known as the tiresome gadfly at church business meetings who always has a bunch of questions.

2. If you think you know of a problem tell the appropriate person or committee before you raise the issue publicly.

Sometimes churches, church treasurers, and pastors are not as informed as they need to be on matters of compensation, IRS rules, and the like. I would like to be optimistic and think that it would not be seen as a threat if they were made aware of something that needs correcting.

I once found out that my church was innocently engaged in an accounting practice that was misleading. The reports said one thing but the reality, including how much money was actually in certain accounts, was different. I fixed it with the church treasurer and explained it to the church and that was that. No one was insulted or made to feel that they were deliberately trying to deceive the church.

If you are informed enough to know that your church is, for example, handling the pastor's compensation, tax status, or housing allowance incorrectly then you absolutely should raise this question. Just don't do it in a threatening manner. Most church treasurers (most CPAs I'd bet) are not up to speed on clergy tax matters which are different than regular folks.


3. Be known as a generous giver.

If you give a pittance to your church then keep your mouth shut unless you know someone is stealing or something serious like that. Your membership in the congregation may fully entitle you to speak at business meetings and ask any finance people or the pastor questions, but someone who doesn't support the church financially or who gives a token gift just doesn't have much credibility. As pastor, I never knew what anyone gave unless they told me but if I had someone who always complained about church finances, I might be tempted to find out. Chances are in an average congregation, folks have a sense about who gives and doesn't give anyway.

4. If you are knowledgeable, make a suggestion about how to fix things.

A church that doesn't give timely records of contributions in the proper manner, for example, could cost its members additional headaches and grief from the IRS, not to mention additional taxes. A non-threatening and simple solution would be to offer the proper forms or to direct the appropriate person to a source for this.

Frequently and regularly there are news reports of churches being robbed by staff, usually the administrative financial person. Implementing some internal controls over church finances is not all that difficult but if the pastor doesn't know enough to do this or doesn't care, a respected layperson should step up and find a way to suggest simple changes that should be made. 

Here's a fact: most pastors don't know a lot about finance, reports, and all that. They would rather stick to the 'spiritual' things and let others handle the administrative stuff. The problem is that laypeople are less likely to know certain things about clergy and church financial matters than the pastor. If he doesn't know and just coasts along, some knowledgeable layperson might help out. If you are this person, expect to be asked to take a volunteer job.

5. Leave the church. 

A church where financial mismanagement is known, has been brought before the church leadership, and nothing is done is probably not a church worth belonging to. Most laypeople in most SBC churches know that they can outlast the pastor if he is a problem, so I'd make leaving a last resort. Staying in a church with known, uncorrected financial impropriety (and not just a gripe about how much staff are paid or how money is budgeted) is serious business.

I'd make allowances for ignorance and mistakes but a church whose pastor and church treasurer know that finances are being mismanaged and does nothing about it is a train wreck waiting to happen. Better to get off before it happens if you've tried to help and have been rejected, or condemned for asking about such things.

My stance as pastor was to practice the old Baptist axiom, "Trust the Lord and tell the people." That solved many a financial problem in the church. I would also tell the congregation that if they had a money question, ask and they would get an answer. Frankly, it is harmful to the body for churches to fail to be open and  transparent about their finances.

There is no guarantee of success here if you are the concerned layperson. You may end up being the abused martyr. Pray about it and do what the Lord tells you. That always works for the best in the long run.

Stealing from the church, your church

Dear pastor, please rouse yourself from plumbing the depths of the hypostatic union and from filling your mind with other highly spiritual thoughts and give some attention to the grimy, mundane matter of church business.

There's a good chance that one of you leads a church where a trusted administrative assistant, financial secretary, or bookeeper is stealing your church, God's church, blind.

Former church bookkeper facing prison time for embezzlement

The details of this recent story are depressingly consistent with most all of the others that are regularly reported. A trusted church employee is caught stealing funds from the church, hundreds of thousands of dollars, over many years.

In the case linked above the amount was estimated at $300,000 over a period of years. The church bookkeeper is reported to have used numerous methods to steal. One report says that she would simply transfer money from the church's bank account to an account of a family member.

Banks keep up with these things, you know. Any movement into or out of a bank account has a trail. How about you initiating a simple audit and have either an accountant  or even members of a church finance committee sniff around, check bank transfers, scrutinize checks that are written, and reconcile bank deposit slips with actual deposits. 

If your church were to be a victim of such embezzlement I doubt that you would be held responsible by the congregation. But you are the leader. If you church is like most SBC churches you are the only full time staff member. You may not like it but it is part of your job to see that proper internal controls are put in place that would avoid theft like the one featured above.

Chances are, someone who reads this blog is in a church where someone is stealing from you. It is that widespread. Most of the time the thief is not all that sophisticated and it would not take much to catch him or her. 

I used to have a member of my church who was the manager of a large toy store. He told me that every year during the Christmas buying season, he would be able to find an employee, perhaps a cashier, stock person, or other employee, who was stealing. He would work with police to gather evidence and then arrange for them to come during store hours and arrest the employee publicly , perp walk and all,  so that all other employees would see and know. This was a pretty strong deterrent.

In the same way, a church employee caught stealing should be prosecuted and punished. You can handle forgiveness any way you choose, just make restitution a part of the process.

People in your church work hard and give generously. You owe it to them to take the steps necessary to ensure that it is not easy to just steal their money and God's money. Alas, when pastors address the matter of stealing from the church, they usually have a sermon on tithing in mind. You can do both, my friend.

Get with it. Now would be a good time to start.

How's your church doing financially?

One of the things about visiting different churches each week, my worship plan for the past seven months or so, is that there is almost invariably a financial statement available in the foyer.

I've been known to sneak one out for more careful review at my leisure.

To tell the truth, when I scrutinize another church's financial statement I get a mild feeling of ecclesiastical voyeurism. It's none of my business, but we all know how nosy Baptist preachers are.

I am gratified that most churches are forthright, open, and unashamedly transparent about their financial matters. Being wide open about church finances, lay it all out there for everyone to see and know, is a very healthy practice that helps clergy and churches alike avoid some of the more harmful effects that money can cause in a church.

What I am seeing, just about every Sunday, is a church that is behind on their budget.

I will admit to more than a modicum of concern about finances when I was a pastor. My favorite church committee was the counting committee and I would often, playfully tell the ladies (they were always ladies in the churches I pastored, except for honest-as-the-day-is-long Albert who was an all-in-one treasurer, counter, internal auditor, and check dispenser in my first church) that they needed to do a better job because the totals weren't large enough.

One of the things I don't miss is, dare I say it, the weekly concern about budgets, bills, and such. The Lord invariably took care of things but it would have been nice to meet a budget every now and then.

Count me as highly appreciative of the folks in church who give regularly, some who tithe, some who go beyond, some who give occasionally but who, together, make it possible to have paid, full time clergy who may focus on preaching the Word and ministering.

If I come to your church and you have a monthly financial report available, I'll subtly fold one and slip it into my Bible. When I get home and read it, I'll doubtless say a prayer for you and your church finances.

So...how's your church doing financially? Do you lose sleep over it? How do you respond in your church if things are going south?

You have my prayers.