That would be the brusque answer to the question, “Why do so many churches have money embezzled from them?” The fuller answer would be that most churches are small, depend on volunteers for financial matters, and are far too relaxed about the handling of contributions and disbursements by the people who serve as treasurers and church financial secretaries. [It is also the answer to the question, “Why are churches targeted by pedophiles?” and I have heard experts be less kind about this. “Because churches are stupid and are easy targets.”]
Take LifeWay Research’s examination that touches on the matter which Baptist Press reported in the story linked below. It was a 2016 study that has been resurrected for current use.
Study: The church, money, and embezzlement
Key findings in the study:
9% of protestant pastors reported that there had been money stolen from their church either while or before they became pastor.
This is not a small number. Consider that the typical SBC pastor might serve half a dozen churches over time, which means that it is more likely than not that one of them will have had a problem with embezzlement and theft of funds.
I’d speculate that when a pastor addresses theft it is only in a sermon and is about robbing God of the tithe, not about embezzlement. The former addresses potential revenue of the church while the latter details actual, hard earned dollars given to the church with the expectation that church leaders will manage them properly and spend them wisely.
Earlier, smaller studies on the issue of church fraud and theft found that even higher percentages of churches were victims of such. The 91% of pastors answered the LifeWay survey question that asked if they were aware of any theft from the church. Churches, we know, don’t tell the new pastor everything that happened before he arrived.
Church audits are common
This surprises me. LifeWay found that almost half of churches reported a financial audit within the past year. Digging into the study one finds that Baptists and Methodists are more likely not to have had such audits recently. With our polity, no church is required to do this. It’s a leadership issue.
In all my years as a pastor I never asked that an audit be done nor, so far as I was aware, had the church ever had an audit. LifeWay’s question didn’t define “complete audit” so it doesn’t mean an outside audit. I did what I would call internal audits regularly with the churches I pastored.
Churches generally don’t have vast reserve funds
Half of churches report that they have 15 weeks or less reserve on hand. That sounds about right. There were times when my church was way below that. Thank God for faithful people who show up Sunday after Sunday and give, providing a steady income stream.
A few suggestions:
- To lower the possibility of embezzlement the pastor must lead the church to have sufficient internal controls and proper money handling policies. Sad fact touted by every CPA I have ever known: If people can steal some of them will steal. Yes, even good, faithful church people. State conventions do well in providing church financial policy guidance. Given that the median SBC church has 70 people in attendance each Sunday, expertise within the church may be lacking but resources are free and easily available.
- Some committee or team in the church must be knowledgeable and watchful about finances. It’s not enough to have someone who is considered to be a trustworthy individual as church financial secretary and/or church treasurer. There must be educated accountability. A single person doing the counting, depositing, check writing and signing is a disaster waiting to happen (or, that has already happened but you don’t know it yet). I recently worked with a church to educate a new church treasurer and finance committee on proper church financial policies, job descriptions, and duties and responsibilities.
- An annual audit or review should be done by every church. This need not be a full outside audit but at least an internal audit. The finance or stewardship team can do this if they know how. Our state finance people recommend that churches enlist someone outside the church to review or help review church finances. They even provide a checklist for such a review.
- The pastor is responsible for church finances. If things go awry with church money, who will be blamed all or in part? Well, the humble and dedicated pastor, of course, on whose watch the embezzlement occurred. A wise pastor will be knowledgeable enough to know how to lead the church in this area and enlist good people who can be in charge of such things.
- Being open and transparent and making regular financial reports to the congregation helps to avoid theft and embezzlement. Let members have reports and show that leadership is willing to answer questions.
Have a good Lord’s Day…and, just for fun, mentally track the money that is dropped in your offering plates. Who handles it? Who counts it? Who makes the deposit? Are copies of the deposit slips made and checked against the bank statement? Who writes the checks? Who signs them? Are bank statements reviewed by someone other than the check writer and signers? Are regular reports made the church on finances? Does anything not add up? You might identify problem areas to be addressed later.
I suspect that few of us had seminary classes in this. A little self-education can go a long ways, though.
God bless you, your budget, and your bank account brethren…and don’t handle any church money yourself, pastor, except your paycheck.
