John Oliver Exposed the Mega-Church Conmen - How the IRS Lets Them Get Away with It

John Oliver’s segment on televangelist prosperity preachers this week has exposed what some say is a massive system of fraud that is being carried out on vulnerable people with no government enforcement or oversight.


Oliver’s HBO show Last Week Tonight highlighted some egregious examples, including Robert Tilton, Mike Murdock and Creflo Dollar. Dollar came under scrutiny for raising money to buy himself a $65 million personal jet. Murdock boasted to his parish that he bought a jet with cash, and because he could sense so much jealousy, he bought another one worth three times more, again with cash.

The preachers are subscribers to something called “prosperity gospel,” a suspiciously self-serving idea that wealth is a sign of God’s favor. They tell followers that sending them money will result in receiving money, for which of course, there is no guarantee in the real world.

“Really the best way to say it is, it’s fraud in the name of God, but because it’s in the name of God our legal system turns a blind eye,” said Andrew Seidel, staff attorney for the Freedom From Religion Foundation. “It’s a religious pyramid scheme. And worse, it’s a religious pyramid scheme that’s based on spiritual blackmail.”

Non-profit organizations are audited regularly and have to submit detailed financial disclosure forms to the IRS yearly, said FFRF co-president Annie Laurie Gaylor.

Religious organizations don’t have to submit anything. There is literally no oversight. This while taxpayers are footing the bill for lavish mansions prosperity preachers often live in. Religious leaders get to take advantage of a tax policy known as “parsonage,” meaning housing allowance provided by their church is not taxable income, plus they can deduct the interest if they have a mortgage payment. This, Gaylor said, is double dipping and it costs American tax payers millions.

“Everybody pays more because the clergy has this housing allowance,” she said. “The revenue has to be raised somehow.”

To get to the heart of the problem, ministers and their organizations should have to fill out the same IRS forms other non-profits do if they are going to get this tax payer-funded subsidy.

That way, “at least the government has some way of ascertaining you are what you say you are,” Gaylor said. “Right now there is no accountability. So it’s just asking for problems, it’s the perfect way to hide things.”

In many cases though, it seems the ministers in question don’t try to hide anything. They do it all out in the open.

The John Oliver segment shows preachers pushing their viewers to send in what little money they have by promising they are going to get a windfall in return. It’s the idea of “seed faith,” Oliver explains, “the notion that donations are seeds that you will one day get to harvest.”

He then cuts to video of preachers hawking this fictional harvest.

“All you’ve got is $1,000,” says televangelist Henry Fernandez, pointing into the camera. “Listen, that’s not enough money anyway to buy the house… You get to that phone and you put that seed in the ground and watch God work it out.”

Seigel called it hucksterism at its worst.

“All of this reeks of fraud, because they’re not selling anything, they’re taking money and making all these promises,” Seigel said. “It’s incredibly predatory. It’s really disturbing. It’s a failure of the system to protect this vulnerable population.”

Ole Anthony of the Trinity Foundation, a group that investigates religious fraud, told CBS News that people donate millions to these preachers because the IRS turns a blind eye.

CBS reports that since Oliver’s segment aired, the IRS has been under pressure to look more closely at religious organizations.

Nevermind that the idea of material wealth as a sign of God’s favor seem to run counter the centuries-old tenets of Christianity that have traditionally viewed its central figure, Christ, as being born poor in a stable and dying poor, executed by the state.

Cathleen Falsani wrote in a Washington Post column that it’s an “insipid heresy” that encourages mainly the working class to live beyond their means.

“The gospel of prosperity turns Christianity into a vapid bless-me club, with a doctrine that amounts to little more than spiritual magical thinking: If you pray the right way, God will make you rich,” she wrote.

The idea became popularized in the 1970s and 1980s by three televangelists who are viewed as its founders: Kenneth Hagin, Kenneth Copeland and Frederick K.C. Price.

Seigel said the church lobby is too powerful.

“We have no idea how much money goes into these churches and where that money goes,” he said. “It’s a financial and information black hole.”

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