I need to state up front that my problems with Mike Bickle's organizations stem from doctrinal issues and not his handling of finances. At least not what we know of his handling of finances.
Others have suggested there might be trouble in the New Jerusalem. So let's do a cursory review for their sake.
Any para-church organization that has grown this big (>$13 million annual income) should be subject to close inspection, closer than I can give here. Most such organizations this big, in order to gain the confidence of their contributors, would subscribe to groups such as the ECFA. Not this group.
When we discuss the Bickle franchises it makes sense to start with the most visible, IHOP. That's the International House of Prayer. Pancakes need not apply.
If you will go to guidestar.org, and sign up for a free account, you can look at IRS Form 990s for International House of Prayer; the most recent being 2005.
As some have suggested, the money issues are very complicated. The IHOP finances appear to be principally the passing through of "prayer missionary" funding to the tune of 3 million annually. IHOP has virtually no equipment or property other than a few items of A/V equipment (which means their facilities are rented from other Bickel franchises or others).
Apparently, if you are a "prayer missionary" at IHOP, you are expected to raise your own support. Your sponsors, to gain a tax benefit, give the money to IHOP with a post-it note on the check stating who it is for. IHOP then uses that for your support. On the surface it appears that nothing is wrong with that, if you are comfortable with the concept of "prayer missionary." It's a simple IN/OUT operation, a sort of heavenly "money laundering."
Most people are not aware that charitable donations to a 501(c)3 are not tax deductable in certain cases where a designation for that giving is made. Paraphrasing Keith Hamilton, CFP, in his guide on Designated Fund Management he says:
Contributions designated to an individual within the church (i.e. a prayer missionary) for the individual's exclusive use and under its total control is not a deductible contribution to the church. (The missionary is not a 501(c)(3) organization.) The church cannot add the designated contribution to the donor’s contribution statement because the church does not have any control over the contribution.
Thus, the practice of making an extra "offering" to a church so that the church can in turn support a Christian School student with a "scholarship" reducing a specific student (implied by the one making the "offering") so that the donor can, in effect, make the tuition tax deductable is not permitted.
Obviously IHOP is aware of the dynamic, or they would not instruct the donor to use a post-it note in lieu of the memo line.
An understanding that so much of the money coming in and out of IHOP is related to these designateds funds is needed to make sense of the IHOP tax filings.
2005 IHOP form 990
2006 IHOP form 990
HOWEVER, the form 990 for IHOP does list related orgs under common board control.
You will find listed there Friends of the Bridegroom and Shiloh Ministries, Inc. On the FOTB return you will then see Grace Ministries listed.
2005 FOTB form 990
2006 FOTB form 990
2005 Shiloh form 990
2006 Shiloh form 990
Shiloh is a relatively small aspect of the Bickle empire. It was originally intended as a retreat center for wounded prophets, and was headed up the wounded prophet Paul Cain. Shiloh lists two properties- a 300K retreat center and a 700K "legacy house."
FOTB's 990 is where Allen Hood and Bob Fraser salaries are listed, and they are payments to them for their work with IHOP. Also David Silker and Dale Anderson. You cannot separate the two orgs; it is one org with 2 checking accounts. Or 3. Or more.
What is tremedously disturbing about the FOTB return is you will see (2006) 2.8 million in contract labor listed, including $893,827 in contract management fees. A huge increase over 2005, BTW. The IRS typically frowns on using a lot of contract labor, in this case it appears that almost all the work at FOTB (aside from IHOP missionaries) is done by contractors. Typically, in business, this is done to avoid payroll taxes, it may also be done to avoid having to list payments to certain individuals. At the very least, the payment for labor with 70% of it through contractors is very odd indeed.
The IRS tests of an independent contractor is very rigorous - you cannot tell them when to work or how to do the work. How an org like this could function with this much work being contracted (out of their control) is a real question.
IRS contractor rules
The FOTB returns also show monies to Mike Bickle's wife for real estate management, and (2006) $12,000 to an "officer's brother" for a benevolent need. Preumably the same one who recieved $6000 the previous year. These activities are LEGAL; the reason they are required to be listed is because they raise questions. Questions, anyone?
The IHOP proponent over on the SOJ blog who said IHOP was a small organization fails to recognize that the combined revenue income of IHOP, FOTB, and Shiloh is probably around 13 Million annually. This excludes unknown revenue through Grace Ministries and through Bob Fraser end-times investment schemes. It's not Wall Street, but its not small.
An unknown factor is the effect of IHOP's recent liason with GOD TV. States one IHOP blogger:
"God TV is convinced that they can bring our monthly subscriptions to the 24/7 live webstream up to 1 million. At $10/month, 1 million subscriptions means $10 million coming into the IHOP missions base. Mike is excited about what this means in enabling thousands of intercessory missionaries to do this full-time."
That blogger worries about the effect that that much more money and exposure will have on IHOP. And that's coming from the inside.
So what conclusions can be drawn? Honestly, at this point, not much. There is a lot of smoke-and-mirrors. We do not see the type of wealth-flaunting that has been seen with many other ministries. Bickle himself reportedly lives a rather simple lifestyle.
I think the biggest questions all point back to the Joseph Company investment schemes, which probably are buried in yet another organization's returns. One of those related organizations is "Deeper Waters" which recieves interest from FOTB and owns the property used by the Forerunner School of Music.
2005 Form 990 Deeper Waters
Mike Bickle teaches about experiencing "power encounters in finances." Bickle's Joseph COmpany cohort Bob Frazier sums its all up when he talks about the "God-ordained transfers of wealth and power" from the ungodly:
"The Treasure Bringers are those with an anointing from God to facilitate this massive wealth-transfer."
"They are spiritual 'Robin Hoods.' Their greatest joy is plundering the wealth of the world for their Lord."
Plundering. Need any more be said?