Church loaned £65k to pastors son? For His Private construction company?

[MeganLewis1]

So in 2020, many senior church leaders and bunch of people who attended the church for decades suddenly left. It was very weird, they’ve been there since 1995, loved and very loyal to the church and pastor.

I heard someone who left who was once very close to the pastor say something like “they only care about money” and someone say for financial reasons.

I was curious so I looked up church charity commission page.

“The loan of £65 000 was made to company X on 13 January and 9 March 2020. The Director ofthis company was formerly a Trustee ofthe charity. The loan is charged at an interest rate of 6.5% per annum and is secured by a Personal Guarantee of the company director.“

When I looked up this company I see it is the pastors daughter and son in laws construction company.

The pastor is one of the trustees by the way.

I see only £10,000 of the original £65,000 appears to have been repaid by 31 March 2025, with £55,000 still outstanding.

I put this through ChatGPT and it said Its filed financial information also shows that the company had negative net assets/net worth in the years shown by the available accounts:

2020: -£47,206
2021: -£54,522
2022: -£65,403
2023: -£58,886
2024: -£34,417

And The 2021 accounts explicitly state 6.5% interest.

But the later 2024/2025 notes, as displayed in the Charity Commission accounts, omit the interest-rate wording while continuing to describe the loan and personal guarantee.

And tbh I don’t remember pastors son in law or her daughter ever being trustees like the document says. Btw church annual income is about 95-100k a year.

I guess I’m asking if this is normal/legal? If anything here seems dodgy?

And if not, why did it so many people leave (I think ) because of this?

BTW this church is non denominational.

Thank you

No idea. Not sure this is the best section to post this in? Maybe try the legal advice bit?

Bit suspicious of the little flurry of threads about church and finances

Tbh Same church.

i name changed for privacy reasons

So have you started three threads on church and finances? Each with a different angle?

I started 2

i at first was paranoid about being too identifying. So decided to name change.

but this is the situation.

i opened their charity commission accounts.

saw this 65k loan first and then saw this orphanage listed. I don’t know why but I decided to google it and first thing I see it’s closed. Closed since 2017.

I’m trying to make sense of all this

There is definitely something fundmentally wrong with that church.
You can report the financial thing to the chariry commision.

This isnt a Christianity issue though so it would be better to ask about this in a different part of mumsnet.

So I now gather that this is the same place as the one collecting for a non existent orphanage. They sound like con artists. Find another church and don’t give them another penny.

Wise advice.

@MeganLewis1 and @Vanessaandjamie1 Agreeing with @Geneticsbunny and @LauritaEvita here. This is a legal issue and not specifically a Christian issue so best to post in more appropriate parts of the site. You should also be contacting the Charities Commission. Also agreeing that you should not pay another penny and find yourself another place of worship.

Even if it is legal for a charity to have investments (presumably OK if it's not contrary to the trust deed and on what you say the Charities Commission know about it) an investment like this at best has very poor optics given how close each side are to each other.

A personal guarantee means that if the company doesn't pay the director has to. Personal guarantees are worth as much as the person giving them has, but people tend not to want to go bankrupt.

Btw my concern here would be that the construction company was insolvent and the loan was to bail it out. This would be a big conflict of interest if so and the church would also risk losing its investment.