A Prophet with Honor

by William C. Martin

  During the spring of 1977, the Charlotte Observer published a four-part series on Graham and BGEA by investigative reporters Mary Bishop and Robert Hodierne. After a year of scrutinizing the ministry’s operations and receiving what they believed had been a full disclosure of all its facets, Bishop and Hodierne gave Graham and his organization a clean bill of health. The ministry, they said, was financially upright and refreshingly free of scandal. In their report they quoted Graham as saying the association spent nearly everything it raised each year and was seldom more than a million or so long or short. He also volunteered that he thought it would be wrong for BGEA to own stock, since ownership could be construed as an endorsement of a corporation. Just a few weeks later, however, the Observer broke a story that delighted doubters and caused millions of true believers to wonder if even Billy Graham had succumbed to the lure of lucre. The paper revealed the existence of the World Evangelism and Christian Education Fund (WECEF), incorporated in Dallas and worth $22.9 million. Most of the holdings of the seven-year-old fund, which the paper said had been “carefully shielded from public view,” were in blue-chip stocks and bonds, but assets also included $3.9 million worth of prime undeveloped land in the Blue Ridge Mountains of North Carolina, purchased by Dallas attorney Jerry John Crawford in 1973 and held in his name until 1975. Though he used WECEF money, the Observer reported, Crawford did not mention Graham or any of his organizations while making the purchase. Further, when owners of land next to the tract asked if Graham or any of his people owned the land, they had been told no as recently as the spring of 1977. That WECEF was a Graham organization was beyond question. Almost all of its funds had been funneled into it from BGEA. Nine of its eleven board members were also directors of BGEA; the other two were Ruth Graham and her brother, Clayton Bell.

  The explicit and implied charges in the article stung Graham, and in contrast to his standard policy of turning the other cheek to his critics, he characterized the Observer article as “grossly misleading” and used an Hour of Decision broadcast to offer a detailed statement, which was then released to the press and sent to his supporters. WECEF, he explained, had been established for three purposes: to provide support for such student-oriented programs as Campus Crusade, the Fellowship of Christian Athletes, and Young Life; to establish an evangelism institute on the campus of Wheaton College; and to develop a layman’s training center in Asheville. The fund’s extraordinarily low profile, he said, had been seen as desirable to avoid giving the impression that the ministry was so rich that it did not need small contributions and also to avoid a flood of requests from needy projects. In a more scriptural but less persuasive defense, he quoted Matthew 6:3–4:

  “But when thou doest alms, let not thy left hand know what thy right hand doeth: That thine alms may be in secret: and thy Father which seeth in secret himself shall reward thee openly.” As for his previous statements about holding stock, well, this was different, since WECEF did not bear his name.

  Neither the legality of the fund nor the way its monies were spent was ever questioned. It was fully registered as a nonprofit corporation in Texas, it filed yearly 990 forms with the IRS, it was overseen by unpaid board members and had virtually no overhead expenses, and the money was being disbursed exactly as Graham said. Between 1971 and 1975, for example, WECEF had donated more than $1 million to the Billy Graham Center at Wheaton, a center for the study of evangelism and the repository of Graham’s extensive archives; $260,000 to Montreat-Anderson College; $120,000 to Gordon-Conwell Seminary; $72,000 to the Fellowship of Christian Athletes; and smaller amounts to more than a dozen other Evangelical groups. (It also channeled $240,000 into the coffers of Christianity Today, a detail that magazine omitted in a listing of major recipients of WECEF funds. When asked why he had not included CT, editor Harold Lindsell said he “saw no need to do so.”) Despite the legitimacy of the fund and its beneficiaries, Bishop and Hodierne understandably felt they had been deceived. When Graham and his associates sketched the ministry’s various financial components, the reporters asked if that covered everything and were assured that it did. Now, that seemed plainly not to be true. The claim that they had not even thought about WECEF, since it was a legally separate entity, persuaded no one. The claim that the fund was not a secret, since 990 forms are available to any wishing to see them, was equally unconvincing, since even the most diligent sleuths are unlikely to ask for information about an organization they do not know exists.

  Feeling burned, Hodierne took a closer look at the real estate owned by the fund, and for awhile it appeared he had uncovered the real dirt. Not only had Jerry John Crawford purchased land without revealing his use of WECEF money, but it seemed possible that several of Graham’s relatives and associates in the ministry might have benefited financially from the transactions. Hodierne’s investigation centered on a payment of $2.75 million for Porter’s Cove, a 1,050-acre piece of stunning mountain property on the edge of Asheville where Graham planned to build the proposed training center. The owners of the property received $2.1 million; the remaining $650,000 went to the North Carolina firm of Pharr Yarns, which had purchased an option to buy the property for $2.1 million just three months earlier. The option had cost Pharr $25,000. Real estate experts told Hodierne that no one would assess the property as worth more than $2 million, that the highest offer prior to Pharr’s had been $1.5 million, and that it was simply unheard of for a $25,000 option to produce a $625,000 profit in so short a time. The plot got even thicker when William Pharr revealed that he had shared the profit with McLain Hall, a Greenville, South Carolina, real estate broker. Hall and Melvin Graham, who speculates in land, were involved in several land deals at this time, some of which involved not only Pharr Yarns but Morrow Graham, Catherine Graham McElroy, and Leighton Ford as well. Further, Grady Wilson and Cliff Barrows had also made real estate investments with Hall. Because William Pharr indicated that he and Hall had shared $465,000 of the profit for the option but would not account for the remaining $160,000, it seemed possible that Melvin, and perhaps some of his relatives and close friends, might have pocketed some of that money. Since Melvin was a member of the WECEF board, such action would be not only unethical but illegal. Asked about that possibility, an IRS official replied, “If these are the facts, then they have a problem with us.”

  Neither Hodierne nor the IRS nor anyone else was able to establish that Pharr or Hall knew the foundation was looking for property when they bought the option. Melvin Graham emphatically denied that he or any relative or board member or ministry employee received any profit whatsoever on the transaction, and no evidence to the contrary ever surfaced. Billy Graham declined to say whether he was aware of prior ties between his relatives and the owners of the option, but T. W. Wilson said he felt sure Billy knew nothing about these dealings. When pressed as to why the foundation had paid such an inflated price for both the property and the option, without so much as getting an appraisal or haggling over the premium, WECEF and BGEA board member Bill Mead, CEO of Campbell-Taggart Industries, said, “We didn’t consider it necessary. If [a piece of land] fits the purpose and you can make [the deal], you do it. . . . That’s the one we felt we had to have to accomplish our purpose, so we bought it at the best price we could.” Melvin Graham snorted, “You pay what a man’s asking . . . or you don’t get the property. If you’ve got any common sense, you know that.” Those with more than rudimentary common sense, of course, felt that anyone who paid the initial asking price on such a piece of property had not had much experience with real estate, a description that did not fit Melvin Graham.

  It was not a happy time for the Graham organization. Even the most charitable reading of the evidence made it appear that BGEA had not been completely straightforward with either the press or their supporters, and that key leaders in the association had exercised poor business judgment and displayed uncalled-for generosity in allowing some of their friends to make an unreasonable profit on the deal. Letters and calls to the Observer and to BGE
A, even from people sympathetic to the ministry, urged Graham to come clean and clear the air, admitting mistakes if there were any, and then get on with his ministry. Others, of course, condemned the newspaper for attacking a trustworthy man of God. Ironically, some letters defended both Graham and another homegrown ministry to which the paper was beginning to give a hard time: Jim Bakker’s PTL Ministries.

  Though Graham acknowledged the fund had not been widely publicized, he denied it had been a complete secret. Its creation in 1970 had been announced at a news conference in Minneapolis, and the Religious News Service, whose subscribers include the New York Times, the Washington Post, Time, Newsweek, and CBS, had carried stories about it during the first year or two of its existence. More pointedly, Graham noted that he had talked about it freely in 1972 with Peter Geiger, a respected religion reporter with the Akron Beacon Journal, a newspaper in the Knight-Ridder chain, which also owned the Observer. The Observer’s response to that particular bit of intelligence seems to have been less than exemplary. According to Geiger, whose memory of the incident remained fresh in 1989, he had gone to North Carolina in 1972 to gather information for an extended piece about Graham prior to an upcoming crusade in Cleveland. While visiting his boyhood home, by then surrounded by a new industrial park, Graham volunteered that when his family sold the land, he had put his share of the money into a foundation headquartered in Dallas and headed by one of his board members. Monies from this fund, which had grown to $2.5 million at the time, would be used to further world evangelism. Geiger mentioned the fund in his story but thought little more about it until he read the 1977 Observer series and listened to Graham’s defense on the Hour of Decision.

  As a kind of memento of the visit, Geiger had kept the tapes of the interview. On checking them, he confirmed his memory that Graham had indeed talked freely about the fund and that he had written about the fund in his story. He immediately sent a copy of his story and a transcript of the interview to David Lawrence, editor of the Observer. Lawrence did not respond, but Geiger’s own editor advised him not to make a fuss about the matter. A few days later, Graham called to ask Geiger if he remembered their conversation. Not sure just what force his editor’s cautionary statement carried, Geiger answered carefully: “Mr. Graham, if you had told me about the fund, I would have had it in a tape recording and would have written about it. If that were true, I would have sent it to the Observer. Do you hear me?” Graham exulted, “I hear you loud and clear. Thanks a lot!” Several weeks later, Charlotte television executive and longtime Graham friend Charles Crutchfield called to ask Geiger if he had indeed sent a transcript and a clipping to David Lawrence. Geiger gave Crutchfield the same answer. Shortly afterward, Geiger’s editor asked him, “What have you done?” Geiger explained, “I tried to set the story straight.” He then learned that Lawrence had said he was going to Montreat to check with Graham. Geiger asked how long that would take and was told it was none of his business. About six weeks later, Graham called Geiger to say, “I’m hurting. What can you do for me?” Lawrence had indeed visited with him, but had written nothing as yet. “Shall I call in [AP religion writer] George Cornell?” the evangelist asked. Geiger told him that was a brilliant idea. By contract, the Associated Press was free to use everything he published, and he would be happy to send Cornell the tape and his article. Shortly afterward, Cornell called, got the information he needed, and wrote a column explaining Graham’s side of the story and chiding the Observer for its own failure to come clean. The story went out on the wire on Wednesday, for Saturday publication. On Friday Lawrence called the managing editor of the AP, demanding it be withdrawn. The editor refused. “The Beacon Journal never carried the column,” Geiger said. “I don’t think the Observer did.”

  The following week, Graham called again. “You’re in trouble, aren’t you?” he asked. Geiger admitted he was. He had been called into his editor’s office and told, “We will hear no more of this. You have done your good deed. Now keep your mouth shut.” Graham told him not to worry—“I’ll hire you.” Geiger pointed out that no matter what happened, he could never come to work for BGEA without destroying his own credibility. Graham conceded that point but assured him, “I know ten editors who would hire you tomorrow.”

  In a rare occurrence, BGEA and its affiliate organizations ran a deficit of $3.2 million in 1977, and CT speculated that the hubbub over the WECEF may have contributed to a drop in contributions, but most of the deficit was due to a $2.7 million rise in expenditures. The association was back in the black the following year, and the ministry seemed to suffer no lasting negative effects. More significant, BGEA began making an audited financial statement available to anyone who requested it, for whatever reason. The memory of that incident still rankled people within the Graham organization ten years later, but Billy himself has long since made peace with his antagonists. “David Lawrence and I became friends, eventually,” he said. “When he got a big award in Detroit from the National Conference of Christians and Jews, they wanted me to be their speaker. He did, too. I went up there and gave the address, praising him. I didn’t want to hold a grudge against him. There was no way we could quite explain it to their satisfaction, but it didn’t cause us too much trouble. I spoke to the National Press Club around that time also, and Bob Hodierne was in the audience. They asked me some questions about the incident and I said, ‘Bob Hodierne has taught us some good lessons. We have learned some things from him.’”

  Ruth Graham, cleaning up after lunch while her husband recounted this episode, interjected sarcastically, “That was very gracious of you.”

  “No, it wasn’t gracious,” Billy gently responded. “It was the truth.”

  Ruth snapped back: “He came up here and we told him everything, right out there on the porch, and he went back and what he wrote didn’t have one word of fact in it.”

  “Well, darling, I wouldn’t say ‘not one word.’ There were a few misstatements, but it had a lot of truth in it.”

  “My husband is more gracious than I am,” she said, banging pots as she spoke.

  “We didn’t mention the fund,” Graham continued, “because it was a separate corporation. And they didn’t ask about it. That was a little bit on the fence line, I think. We should have said, ‘We’ve got another fund down in Texas that we are going to do thus and such with.’ We told the government about it, but we didn’t think the newspapers necessarily had a legitimate right to know about everything. I’ve changed my mind on that. I think they do. Because I think we should be publicly accountable for everything.”

  Having proved to himself anew the value of setting up external mechanisms to ensure one’s virtue, Graham became a zealous advocate of full disclosure by parachurch organizations. In 1979 he played a key role in founding the Evangelical Council for Financial Accountability (ECFA), and George Wilson served as the first chairman of its board. The organization’s stated purpose is “to enunciate, maintain and manifest a code of financial accountability and reporting which is consistent with enlightened and responsible Christian faith and practice.” Membership in ECFA is voluntary, and almost none of the well-known television preachers opted to join, but Graham soon began to call on his colleagues to come aboard and to warn Christians against being too trusting. “It is common for most religious leaders to be very secretive about the finances of their organization,” he wrote. “Unfortunately, when legitimate Christian organizations and churches refuse to be completely open about finances, they are conditioning people to accept unquestioningly the contention of the cult leader that he is not accountable to anyone for his financial dealings. If you give to any Christian charity (including the Billy Graham Evangelistic Association) and you don’t insist on an understandable financial accounting of your gift, you are in danger of falling prey to [dishonesty].”

  During the closing years of the 1970s, Graham was nudged out of his traditional spot as the nation’s most newsworthy Christian leader by Jerry Falwell, who was soon joined by Pat Robertso
n, James Robison, and a gaggle of other religious broadcasters and parachurch leaders who were forming what came to be called the Christian New Right. Graham was not tempted to throw in with the new movement. Instead, he began to try on the role of elder statesman. In Christianity Today’s first issue of 1980, he drew on personal experience to warn his newly politicized brethren to “be wary of exercising political influence” lest they lose their spiritual impact. A few days later, in a press conference prior to a preaching mission at Oxford University, he noted that, “in my earlier days and [crusades], I tended to identify the Kingdom of the God with the American way of life. I don’t think like that now.” Though he still favored free-enterprise capitalism, he believed Christians could live under various economic systems. A few days later, in a dialogue at Cambridge with the archbishop of Canterbury, he sounded a similar note, observing that he no longer associated a Christian understanding of society with American nationalism. These were not just throwaway lines designed to please a British audience. In various press conferences and interviews in the United States, he warned against “the mingling of spiritual and political goals,” observing, in notable contrast to his earlier willingness to offer prescriptions for national policy, that “we as clergy know so very little to speak out with such authority on the Panama Canal or superiority of armaments. I do not intend to use what little influence I may have on [such] secular, non-moral, non-religious issues.”

  As he had in 1976, Graham kept a low profile during the 1980 election, but his sympathies lay with Ronald Reagan, whom he had known since 1953. “I met him through his mother-in-law,” he recalled. “I was playing golf with Henry Luce at the Biltmore Country Club in Phoenix, and Mrs. Davis came out on the course. She said, ‘I want you to meet my new son-in-law. You two have many things in common.” And indeed they did. Both reached the pinnacle of their professions by dint of a gift for articulating, in terms easily grasped by masses of people, a large but essentially simple vision. Neither demonstrated any notable talent for critical analysis or practical detail. They understood intuitively how to inspire and how to lead, and how to assemble teams to implement their visions. They trusted fully in a small number of firmly held principles, and as long their friends and associates pledged allegiance to those principles, they assumed they had no reason to be wary of anything else those friends or associates might believe or do. And when that assumption proved faulty and expectations went awry, they possessed a remarkable ability to dismiss the troublesome evidence as a blip, a momentary aberration—certainly not a fundamental weakness in their own vision or judgment. The friendship flourished, and Billy and Ruth often visited the Reagans when they were in California. Graham recalled that on one occasion, while Reagan was governor, “I spoke to a group of Democratic leaders, and they had a big battle as to whether to invite him, because they knew I was a big friend of his.” Reagan did not attend the speech but invited Graham to visit with him and his cabinet in his office, which was in the same building. As soon as they sat down, Reagan said, “Billy, tell us what the Bible teaches about things that are happening today, and where you think we stand in the prophetic scriptures.” Graham observed, “I knew he had an interest in prophecy, but I don’t know where it came from. I understand his mother was interested in all that.”