Texas Baptist 'Valleygate' lawsuit settled

The Valleygate lawsuit filed by the Rev. Otto Arango alleging libel and slander by the Baptist General Convention of Texas and others has been settled in mediation and without an admission of fault to or by Arago, according to confidential sources and documents we were provided.

The overall terms of the settlement "are confidential."

The burden of the settlement with Arango is shared, we were informed, by the Baptist General Convention of Texas (BGCT), the Dallas-based Texas Baptist Standard, Calvary Baptist Church of Mineral Wells, Texas, and the other defendants, through their insurance carriers.

Terms were apparently agreed to in mediation last month.

It was Cavalry Baptist Church Pastor David Montoya, through his blogging as the Spiritual Samurai, who first called attention to the issues involved.

Asked to comment on the matter today, Montoya told us, "I understand that the insurance company for my church has settled on my behalf as well as the church. The amount is confidential. I never had any malice toward Pastor Arango. I was upset with the people in charge of Church Planting at the BGCT back at that time for their complete lack of oversight as found by the investigators in their 2006 report, that was to whom my blogging was directed."

As Sam Hodges of the Dallas Morning News explained in August, 2008, when the original action was filed:

The Rev. Otto Arango claims he was defamed by the Dallas-based BGCT as it dealt with allegations of "phantom churches" and misspent money in a scandal that came to be known in Baptist circles as "Valleygate."

In an independent investigation commissioned by the BGCT noted that Dr. Arango and two other pastors sponsored a reported 258 new churches, which together received more than $1.3 million in BGCT funds.

But many of those new churches failed, others were mere "extension units" of existing churches, and some never existed at all, the investigators found in a report sharply critical of the BGCT for lax oversight.

Although the investigators' report referred to a "troubling deposits of checks into Dr. Arango's personal bank account," no criminal charges were filed. The BGCT chose not to pursue recovery of any of the more than $1.3 million in BGCT funds involved, arguing that civil action was “neither practical nor would it represent good stewardship of churches’ resources.”

Arango's subsequent suit was filed in Hidalgo County (TX) District Court and sought damages for both lost earnings and "past and future mental anguish." Arango's attorney said in 2008 that the matter had made it hard for Arango to continue working with churches in Texas and across Latin America.

[This item is cross-posted on WordPress.]

Misspending God's money

Stop Baptist Predators makes superb use of Mary Kinney Branson's book Spending God's Money to illustrate how key Southern Baptist Convention organizations are abusing the trust of faithful contributors.

Branson is a former marketing director for the SBC's North American Mission Board and her book is "an insider's account of the extravagance and financial mismanagement there."

Christa Brown writes:

Branson provides details that implicate high Southern Baptist officials and those details are not flattering. For example, (NAMB President) Bob Reccord “had a $1 million fund he could use at his discretion, no questions asked and no receipts required.” (Branson at p. 61)

Can you imagine any other organization that would allow an official to spend such sums with so little oversight? According to Branson, that $1 million fund was replenished each year, and in Reccord’s last two years, the fund was reduced to $350,000. In other words, the money didn’t just sit there. He spent it. “No receipts required.”

When Reccord resigned, 41 Southern Baptist leaders signed a letter, praising Reccord and essentially whitewashing his “undisputed misuse of funds.” (Branson at p. 18) One of those signers was Johnny Hunt, who is now the president of the Southern Baptist Convention. Another was evangelist Jay Strack.

According to Branson, after Bob Reccord left the North American Mission Board, “auditors discovered that payments were being made to evangelist Jay Strack ($300,000) and Bob’s mega-pastor Johnny Hunt at Woodstock Baptist Church ($92,000). Final payments were sent after Bob resigned but before he left the building…. There were no written contracts. So nearly half a million dollars was paid to Strack and Hunt through verbal agreements with Bob.” (Branson at p. 113)

Brown's entire piece also deals with the Baptist General Convention of Texas "Valleygate" scandal and a great deal more.

It deserves to be read in full here.