Posted on March 14, 2022

AME Church Halts Retiree Payouts Amid Probe Into Missing Funds

Theo Francis, Wall Street Journal, March 10, 2022

The African Methodist Episcopal Church, among the largest U.S. Protestant denominations, has suspended retirement payments and discussed steep cuts to the savings of its ministers amid an investigation into missing funds, according to church documents and officials.

The church said federal law enforcement and an outside law firm are investigating “a possible financial crime” involving funds managed by its retirement-services department covering about 5,000 participants, including ministers and bishops.

The church declined to say how much money may be missing or which federal agency is investigating. A summary of a church governing-body meeting in January shows the group discussed borrowing $45 million or selling church property to replace at least some of the shortfall.


Ministers said they had learned few details about what might have happened to the contributions their churches had made to the retirement program over the years.


In a mid-February personal blog post, Bishop Jeffrey Leath, based in Nashville, Tenn., wrote that many pastors within a decade of retirement had potentially lost $100,000 or more and suggested that as much as $91 million had been lost. {snip}


The AME Church was formed by Black worshipers in the late 18th century in Philadelphia. The church had about 2.5 million members in 2011, the most recent year for which figures were available, according to the National Council of Churches.

In a Facebook message Oct. 7 addressed to church members, officials of the church’s Council of Bishops said its department of retirement services “has reported a material loss in the value of one or more of its departmental investments” and was undergoing a comprehensive audit and law-firm review, promising to make the resulting report public.

A later letter to ministers said the discrepancies had been discovered after the election of a new retirement-department executive director last summer. The former director, who held the role for about two decades, according to articles he wrote for church publications, didn’t respond to a phone message and emails seeking comment.

In at least some communications to participants, the church’s retirement department described using a third-party administrator to help manage its plans without identifying it. Account statements sent to members showed names or logos of Symetra Financial Corp. and Newport Group Inc., a retirement-services provider. A spokeswoman for Symetra said the company wasn’t a third-party administrator for the plan but declined to comment further. A Newport Group spokeswoman had no comment.


The body also considered a replacement plan allowing participants to choose investment vehicles and discussed selling church property or cutting expenses by $3.5 million a year for 13 years, the summary says.

AME documents show retirement-portfolio assets of just under $120 million in 2017, up from nearly $95 million five years earlier, and five-year average rates of return of about 5%. {snip}