Televangelist Scandals: Holy Fraud

Jim Bakker built the third-most-visited theme park in the United States, raised approximately $1 billion from television viewers over 13 years, and spent the money with essentially no financial controls — selling hundreds of thousands of “lifetime partnerships” for hotel stays at accommodations that didn’t exist and never would. He was convicted in 1989 on 24 counts of fraud and conspiracy.^2^ His story established that fraud through a religious nonprofit could be prosecuted like any other fraud, and then he got out of prison and went back on television.

In 1987, Bakker — the host of The PTL Club and the builder of Heritage USA, a Christian theme park in Fort Mill, South Carolina — resigned from his ministry after it emerged that he had had sex with Jessica Hahn, a church secretary, in 1980 and that PTL had paid her approximately $265,000 in hush money. The financial investigation that followed revealed that Bakker had used PTL donor funds to pay excessive salaries, luxury perks, and personal expenses, and that the Heritage USA timeshare program had oversold lifetime “partnerships” — collecting money from hundreds of thousands of donors for accommodations that didn’t exist and never would.

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The PTL Fraud Showed What Happens When There Are No Financial Controls

The specific fraud at PTL — the Praise The Lord network — involved the sale of “lifetime partnerships” to viewers who donated $1,000 and were promised four nights of lodging per year at Heritage USA hotels. Bakker sold approximately 68,000 such partnerships for hotels that had not been built and, in many cases, would never be built. The donations were used for operating expenses, to fund other PTL activities, and to support lavish salaries and perks for Bakker and his wife Tammy Faye — including a $279,000 Christmas bonus to Bakker himself for one year and air-conditioned doghouses for the family’s pets.^1^

PTL’s finances had never been audited in any meaningful sense. The “partners” who had donated $1,000 for lodging they would never receive lost their money entirely; the bankruptcy proceedings produced cents on the dollar for creditors.

Jimmy Swaggart’s Collapse Was Moral Rather Than Criminal

Swaggart’s scandal broke in February 1988, a year after Bakker’s, when photographs emerged showing him at a motel in Metairie, Louisiana with a prostitute. Swaggart was one of the most prominent televangelist ministers in the world, with a broadcast ministry reaching 145 countries and annual revenues of approximately $150 million. He tearfully confessed on February 21, 1988, in a broadcast that became one of the most-watched moments in Christian television history — the “I have sinned” speech. Unlike Bakker, Swaggart was not prosecuted for financial fraud. His ministry suffered severely and further scandal in 1991 — when he was found again in the company of a prostitute — ended his dominance of the televangelism landscape.^3^

The Bakker and Swaggart scandals in 1987 and 1988 occurred nearly simultaneously and generated intense scrutiny of the televangelism industry. The PTL scandal had specifically financial fraud components that made it criminally actionable. The broader questions they raised — about how religious organizations use donor funds, what oversight exists, and what accountability applies — received sustained public attention but limited regulatory response, given the First Amendment protections that shield religious organizations from many financial disclosure requirements.

Robert Tilton’s Ministry Was Discarding the Prayers While Keeping the Money

In 1991, ABC News’s Primetime Live broadcast a segment revealing that Robert Tilton’s Success-N-Life ministry, which raised approximately $65 million annually through prayer requests and associated donations, was discarding the prayer requests — the letters containing donors’ personal prayer needs — without reading them. The ministry had told donors that Tilton personally prayed over every prayer request letter. Investigators found dumpsters behind a Texas bank that processed Tilton’s ministry mail full of discarded prayer requests; the money enclosed in the letters had been extracted, the letters thrown away.^4^

The investigation also documented that Tilton had promoted medical claims about what prayer could accomplish, implying or stating explicitly that donations would lead to physical healing. Donors with serious illnesses had sent money, sometimes thousands of dollars, based on these representations. The Texas Attorney General opened an investigation, Tilton’s ministry collapsed financially, and he faced no criminal prosecution before subsequently rebuilding a smaller television ministry.

The Financial Structure That Made This Possible Still Exists

The financial structure that made PTL’s fraud possible — religious organizations’ exemption from many financial disclosure requirements, the emotional relationship between viewers and televangelists, the solicitation of donations tied to specific projects or promises — has not been eliminated. In 2007, Senator Charles Grassley of Iowa launched a Senate Finance Committee investigation into the finances of six televangelism organizations, including those of Benny Hinn, Joyce Meyer, Creflo Dollar, Kenneth Copeland, Eddie Long, and Paula White.^4^ The investigation sought financial information about how these organizations used donation revenue, including for private jets, luxury residences, and personal expenses. Most of the organizations declined to cooperate fully, citing religious freedom protections. The investigation concluded without significant enforcement action. For how this pattern continues in the current prosperity gospel movement, see Prosperity Gospel.

Bakker’s conviction established that fraud through a religious nonprofit — selling something you can’t deliver in exchange for donations — is criminally prosecutable regardless of the religious context.^2^ The line between criminal fraud and aggressive fundraising in religious contexts is genuinely contested, and courts have been reluctant to scrutinize religious organizations’ use of donation revenue as long as the basic corporate structure is maintained. Donors who send money to televangelists in response to claims about healing, prosperity, or specific promised benefits have limited legal recourse when those promises aren’t kept, because the claims are typically framed in religious language that resists straightforward fraud analysis. The emotional relationship that makes the donations occur also makes victims reluctant to report or litigate.

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Sources:

1. Shepard, Charles E. Forgiven: The Rise and Fall of Jim Bakker and the PTL Ministry. Atlantic Monthly Press, 1989.
2. United States v. Bakker, No. 88-cr-200 (W.D.N.C. 1989).
3. Martz, Larry. Ministry of Greed: The Inside Story of the Televangelists and Their Holy Wars. Weidenfeld & Nicolson, 1988.
4. U.S. Senate Finance Committee. Staff Report on Grassley Investigation of Religious Organizations. 2011.