Vowing "the truth will come out," a board member of the American Bible Society (ABS) confirmed that a forensic accounting firm will probe the organization's financial records. The investigation comes after ABS suspended its two top executives following embarrassing revelations in The New York Times that linked ABS president Paul Irwin to a technology company with ties to the internet-pornography and gambling industries.
Founded in 1816, ABS is one of the nation's oldest and best-endowed charities, with nearly $693 million in cash and investments on its balance sheet at the end of 2007. But ABS had a $72.8 million operating deficit in 2003 and operating deficits totaling more than $160 million between 2002 and 2006.
Members of the 30-person board at ABS thought they had solved their problems when, in 2005, they brought in the experienced Irwin as president to ramp up fundraising. Irwin, a United Methodist minister, brought with him a record of controversy as CEO of the Humane Society of the United States, including allegations of misuse of funds when a 1987 USA Today report said the Humane Society paid for $85,000 in renovations to his home.
One of the outside vendors Irwin hired to help drive his fundraising success at the Humane Society was Exciting New Technologies (ENT). Irwin and ENT took the Humane Society to the forefront of internet fundraising. The Humane Society ultimately became the largest animal-rights organization in the world.
But ENT's founder, Richard Gordon, has a checkered history. Throughout the 1990s, Gordon's companies, specializing in credit-card transactions, helped make the internet-pornography and online-gambling industries hugely profitable. ENT's work with the Humane Society was part of the company's diversification out of porn and gambling and into the more respectable arena of nonprofit fundraising. In 2003, according to the Times, Irwin's son was hired as ENT's director of business development.
When Irwin came to the American Bible Society, he brought the relationship with Gordon and ENT with him. Under Irwin's leadership, ABS spent more than $5 million with Exciting New Technologies.
When the story of Irwin's and the Bible Society's association with ENT was laid out in the 4,000-word Times exposé, the ABS board acted quickly, suspending with pay CEO Irwin and Chief Financial Officer Richard Stewart. ABS spokesperson Roy Lloyd said the suspension was "without prejudice," meaning that there is no assumption of guilt on the part of either Irwin or Stewart. However, said Lloyd, "We want to deal with any hint of impropriety." Lloyd also said ABS has terminated all ties with Exciting New Technologies.
Ironically, before these recent revelations, it appeared that some of Irwin's innovations at ABS had been working. In 2007, the organization saw a dramatic rebound in revenue, to $120 million, much of the increase coming in the form of increased donations.