A judge rejected a proposed $170 million class-action lawsuit against one of the world’s largest Christian ministries over alleged misappropriation of funds more than three years after the charity paid $37 million to settle a similar class-action lawsuit in the United States.
The Ontario Superior Court of Justice dismissed a motion to certify a lawsuit against Gospel for Asia (GFA World) Canada and a number of its current and former officers and directors.
Plaintiff Greg Zentner of Nova Scotia filed the motion in June 2021, alleging that GFA defrauded thousands of Canadians and churches “who collectively donated millions to GFA Canada by diverting those funds to improper purposes.”
The motion to certify a class action was denied on March 17 by Justice Peter J. Cavenaugh. GFA announced the dismissal in a press statement earlier this month.
The judge found the plaintiff “failed to show some basis in fact for his allegation that the defendants intentionally misappropriated donor funds in a manner that had no connection to any purported charitable purpose.”
The judge also found Zentner had not shown some basis in fact that he or other class members suffered a "compensable loss."
"I regard the evidence as supporting Zentner’s suspicion, based on evidence that is speculative, that GFA Canada misappropriated donors’ money," the judge wrote in his 29-page ruling obtained by The Christian Post.
"But suspicion, based on speculation, is not enough. The approach that Zentner has taken
on this motion ... is to make serious allegations of fraud and then assert that the evidence tendered by the defendants is not sufficient to prove that donors’ money was spent in India as they designated, and discovery is needed to uncover the evidence of fraud. This approach reverses the onus. The onus is on Zentner to adduce admissible evidence showing some basis in fact that donated funds were misappropriated."
"The only expert who has undertaken an analysis of how donor funds were used is [GFA Canada’s forensic accounting expert Andy] Harrington, and his opinion is that GFA Canada used donor funds in the field as directed, an opinion that is not challenged by other expert evidence," the ruling states.
The ruling comes as GFA has maintained that “all funds for the field were sent to their intended destination and used for ministry purposes,” he added.
Founded by K.P. Yohannan over 40 years ago, Gospel for Asia was founded to serve “the least of these” in Asia and Africa, often in places where no one else is serving, so they can experience the love of God for the first time.”
GFA reached a $37 million settlement in 2019 in another class-action lawsuit that accused the nonprofit of mishandling hundreds of millions in donations designated to be used in the mission field worldwide. There was no admission of liability by GFA under the settlement.
In the 2015 lawsuit, Yohannan and his associates were accused of racketeering, fraud and financial mismanagement for using donations earmarked for charitable purposes within its mission fields to build personal residences and a headquarters in Texas.
GFA denied the allegation, but the organization was subsequently expelled from the Evangelical Council for Financial Accountability and the National Religious Broadcasters after financial accountability concerns were voiced.
The offices of Yohannan’s Believers Eastern Church in India were raided by authorities in November 2020 over allegations that the network received foreign donations through associated nongovernmental organizations.
GFA — which is a separate legal entity — later described the actions against Believers Eastern Church as a type of “Christian persecution” and part of an “ongoing smear campaign targeting the ministry.”
An affidavit in support of Zentner's lawsuit cites a press release from the Indian Ministry of finance announcing search and seizure operations said to have been carried out “as credible information was received that the group received donations from foreign countries ostensibly for helping the poor and destitute and for evangelical purposes, but was actually siphoning out of such tax-exempted funds in cash to engage in unaccounted cash transactions or personal and other illegal expenses in real estate transactions."
However, the court ruled that the press release "does not disclose the source of the information" and is "not admissible evidence showing some basis in fact for Zentner’s allegation that GFA Canada fraudulently misappropriated donor’s money."
Preacher and author Francis Chan, who has served as a GFA board member since 2015, has remained a staunch public defender of the organization and Yohannan.
After allegations emerged 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.