IRS Questions $1.3 Million in Purchases Bakkers Charged to PTL

From the Washington Post

The Internal Revenue Service has questioned scores of luxury items charged by PTL founders Jim and Tammy Faye Bakker to the ministry they founded here, ranging from a $592,000 oceanfront condominium in Palm Beach, Fla., to $67,000 in women’s clothes and an $800 Gucci briefcase, a PTL official with access to IRS work sheets says.

Such purchases are among $1.3-million worth of items which were charged by the Bakkers to PTL between 1981 and 1983 and which IRS auditors have questioned as possible personal expenses in the course of their continuing audit into the finances of the tax-exempt organization, the PTL official said.

The items charged to PTL include a Hawaiian holiday by the Bakkers and guests in December, 1980, shortly after Jim Bakker’s sexual tryst with church secretary Jessica Hahn that led to his resignation two months ago.


During that trip, the Bakkers stayed in a $350-a-night hotel suite, bought the Gucci briefcase, a $120 Gucci pen, a $74 toilet kit and a $70 address book--all paid for with church donations, said the official, who asked not to be identified.

IRS auditors are working in the pyramid-shaped executive offices here just down the hall from outside auditors, who also are trying to unravel the ministry’s finances.

Last week, PTL’s new board, headed by the Rev. Jerry Falwell, said that it was unable to account for $92 million in contributions to the ministry and that it believes millions may have been diverted to finance the personal life style of the Bakkers.

A Justice Department official confirmed Saturday that the office of U.S. Atty. Charles Brewer in Asheville, N.C., has asked to meet with Falwell or his representatives within the next few weeks to review allegations of criminal wrongdoing at PTL during Bakker’s tenure. The unidentified official stressed that an investigation into PTL has not begun but that he expects one to begin shortly.

One potential focus of such an investigation, PTL officials say, may be separate ministry accounts controlled by Bakker and kept secret from his chief financial officers. These include one “executive account” from which Bakker and his two top aides, David Taggart and former PTL President Richard Dortch, paid themselves $890,000 in performance bonuses in the first three months of 1987 without approval from the PTL board, the unidentified PTL official said.

Peter Bailey, a PTL vice president and chief financial officer, said Saturday that he was barred for several years from examining any records relating to huge cash advances to Bakker and Taggart from the ministry’s credit cards.


The Florida condo under review by the IRS was purchased for the Bakkers by PTL on Oct. 25, 1982, for $390,000 and furnished at a cost of an additional $202,000 in ministry funds. It was sold the next year after public criticism arose.