Oral Roberts Contracts Stir Anger : Evangelist Imposes New Rules on Medical Students

The money began to pour in as soon as Oral Roberts said God would end his life unless he raised $8 million for his troubled medical school. And, thanks to a $1.3-million gift from a Florida dog track owner, Roberts announced that the goal had been topped just before the March 31, 1987, deadline.

The television evangelist-faith healer repeatedly told his followers that the donations would fund “full scholarships” for Oral Roberts University medical students. But, in fact, the scholarships were loans.

In exchange for a loan of $93,500 made available during four years of study, according to a contract that incoming medical students signed last year, they agreed to work as medical missionaries for four years after graduation to pay back the money.

This year, as the fall term opened at the school in Tulsa, Okla., the returning medical students were faced with having to sign a new contract with an imposing list of restrictions and loopholes. The revised contract states that additional loans will be made “if and when necessary funds become available.” Students who do not sign must borrow from outside sources to meet ORU’s $15,500 annual tuition plus living expenses.

The switch in contracts has angered and intimidated many students, upset donors, and left questions about how the $8 million was spent.

The situation points to a cash-flow problem that may be a sign that the $500-million evangelistic, educational and medical empire of the 70-year-old Roberts and his son, Richard, is tottering.

Officials in Roberts’ ministry and the medical school declined The Times’ requests for comment on the situation.

Jerry Collins, the Orlando, Fla., race-track owner whose gift pushed Roberts over the $8-million goal, said, “Oral needed money right away to graduate all the students at ORU” in May of 1987.

“The medical school was a (financial) failure from the start,” Collins, 80, added in a telephone interview. “They needed cash flow, and I never thought the money would be exclusively for the med students.”

Regarding Roberts’ fund-raising approach, Collins said: “I don’t approve of what’s happening there, but I’m for helping education.”

Many students feel betrayed. Some say they turned down scholarships at other medical schools because they wanted to serve as missionaries through the ORU program.

“I think I’ve been deceived and used by Oral Roberts to raise money in that way,” said a second-year student from California. Like most of the disgruntled students interviewed for this story, he requested anonymity because he feared reprisals by ORU officials.

“They never intimated anything but that it was a four-year (scholarship loan) program,” the student complained.

“It’s a trail of deceit,” agreed another.

Scholarship Contract

A letter to incoming medical students dated July 1, 1987, included a “financial summary sheet” of a four-year scholarship loan contract that showed them how $93,500 would be distributed between 1987 and 1991.

And before they enrolled last fall, the 50 incoming freshmen signed the contract that indicated they could receive the specified funds for tuition, fees, insurance, books, equipment and living expenses over four successive academic years. The students, upon completion of residency, committed to four years of missionary service.

But the contract also contained a paragraph stating that “ORU makes no promise or warranty whatsoever that additional medical school scholarship loans will be made in future years.” “Future years” is not defined.

Then, in a memo Feb. 1, the medical school students were informed by Assistant Dean Milton C. Olsen that the Healing Team Scholarship Loan program would be canceled at the end of the 1987-88 academic year.

Students who stayed in the medical school for the next three years would then have to pay as much as $71,000. And those who transferred from ORU to avoid the high tuition were told they would have to pay back the money they had already received at 18% interest.

Roberts, on his television programs and in letters to donors this year, has insisted he never promised the medical students anything beyond one year’s help.

Writing to his giving “partners” on March 16, Roberts denied that the medical missions program had been canceled--despite the memo to the healing team students saying their scholarships had been cut off.

Less than two weeks later, in a broadcast of the “Richard Roberts Live” television show taped on March 28, Oral and Richard Roberts announced a new drive to raise a second $8 million to restore the scholarship loan program. Richard Roberts said the special drive was aimed at ending the controversy and confusion created by “negative media” about the status of the scholarship loan plan.

Father and Son Explain

More than $8 million had been raised in the first drive not just for the students, but for the cost of operating the medical school for one year, the father and son said on the program.

And in an interview with the Tulsa Tribune, medical school Dean Larry D. Edwards was quoted as saying that only $2.4 million was spent on student scholarships, while $4.75 million went for staff and faculty salaries, $750,000 for research, and $700,000 to support the medical missions programs overseas. Edwards, the only authorized spokesman for the medical school, declined to be interviewed by The Times.

The explanations by the Robertses and Edwards seem to contradict not only what the incoming medical students were led to believe but also what some faculty had thought.

“Dean Olsen . . . admitted in front of the whole class that he represented this as a four-year program because that’s what he thought it was,” said Donald Godfrey, former associate professor of physiology at the ORU School of Medicine. “That was my understanding too,” added Godfrey, who left ORU last spring to become a research professor at the Medical College of Ohio in Toledo.

Donors have complained they were misled by Roberts’ pitch that God had told him to raise the money “in one year or I am going to call you home.”

In the April, 1987, issue of Abundant Life magazine, which is sent to his contributors, Roberts wrote:

“God’s instructions were for me to raise the $8 million it will take to give full scholarships to each of our young physicians-in-training, including their room and board. This way, when they finish their residencies they will not have to go into practice here in America, where there is already a surplus of doctors, to pay off heavy educational debts before they can go to the mission field. They can go immediately, debt-free.”

But that is not possible under the new contract, according to returning medical students who are upset about signing a document that would significantly change their financial situation and their future.

Many Refused to Sign

At least 25 have sought legal advice. Twelve have transferred out of ORU, and about half of the 85 who received scholarships in past years have refused to sign the new contract. This year’s beginning class of medical students is not being offered scholarships.

The “restated loan agreement” says that ORU “may make additional loans, in its sole discretion, if and when necessary funds become available through . . . faith. . . .” It prohibits students from borrowing from “any source other than ORU . . . except with written approval of the President (Oral Roberts) and the Board of Regents.”

Another change under the new contract is that students must pay for their own travel and living expenses during their missionary service, which they must accept “in any domestic or foreign location, without limitation.”

“They want us to hitchhike to the poorest parts of the world, work for free, and feed our families on our good looks--what a deal!” sputtered a student who has refused to sign the revised agreement.

The new contract also changes the terms of service repayment so that most students will have to complete 15 months of missionary work for each year of scholarship funding--which this year was capped at $20,000. Under the original agreement, repayment was based on one year’s service for one year of study, and the yearly scholarship cap was about $23,500.

If they do not serve on a healing team, students must repay their ORU loan in installments at 8% interest calculated from next spring.

“My advice is not to sign the second contract,” said Tulsa attorney Carl D. Hall, who is giving free help to distraught medical students. “They came in with the understanding that the money was raised and they would have no problem and they could go on through” medical school.

Jack Hayford, pastor of the Church on the Way in Van Nuys and a member of the ORU Board of Regents, said he found the flap over the scholarship program “bewildering.” It was his understanding that the $8 million was raised to cover the total costs of the medical school program for one year, Hayford said in an interview.

“A small group of med students feels there’s been some kind of a breach of trust,” Hayford said. “In a technical sense, perhaps.” But, he added that he thought the students should “be grateful for any attempt to continue” the scholarships. “That’s superior to nothing.”

‘The 80,000 Club’

In the August, 1988, issue of Abundant Life, Roberts declared that the healing team program “must continue . . . by faith” for another year and offered a “gold-toned commemorative medallion” to “founding members” of “The 80,000 Club”--Roberts’ new vision of 80,000 “partners” each giving $100 for ORU medical missions.

Hayford said no financial statements for the Robertses’ ministries are provided at regents’ meetings. Nevertheless, he said he has “no doubts” that the $8 million was spent on the medical school and its programs.

“If I thought there was any compromise of integrity, I’d protest,” Hayford said.

Most students who are protesting are doing so anonymously, citing an “authoritarian” atmosphere that has descended on the ORU campus like a thick cloud since news of the scholarship controversy hit the press.

“Sure, we’re intimidated,” declared a student from the East Coast. “We have strong feelings but don’t feel free to speak out.”

Several students told a reporter that at the semester’s opening chapel service (all ORU students are required to attend), Oral Roberts told them not to grumble, warning: “Keep your cotton-pickin’ mouth shut!”

Declared Hall, the lawyer counseling the disgruntled students: “This guy (Oral) is perfectly capable of kicking them out” of school.

One student willing to talk for the record was John Dingilian, 23, an ORU undergraduate and second-year medical student whose father is an officer in Hayford’s church.

Dingilian, who signed the revised contract, said that as a single student, the cut from $23,500 to $20,000 in his scholarship money this year “doesn’t affect me badly . . . but I can see how those (students) with families would have problems.”

“I know I’m at risk (in) talking to the media,” he added, “but I’m not a belligerent student. . . . I like the post-residency program (under the new contract). It leaves a little more latitude, since it allows me to do inner-city work in this country.”

High Debt, Falling Income

Roberts’ publications have reported that the medical complex has been a constant financial drain since it opened in 1981. Roberts has said he needs $4.5 million a month just to maintain the evangelistic ministry, ORU, and the City of Faith Hospital which he has vainly tried to sell. Last December, according to students present at an ORU chapel service, Roberts announced the ministries were $28 million in debt.

Indeed, annual ministry income has fallen at least $30 million from the $88 million raised in 1980, according to several published sources. Jan Dargatz, Roberts’ ministry spokeswoman, declined to cite any figures, saying only: “We are holding our own since January of 1988.”

Meanwhile, obsolescence, attrition and economy measures are pinching the empire of Oral and Richard Roberts.

Their weekly television show has been cut back to cable only because of declines in donations. Last November, Richard Roberts told the Tulsa Tribune the ministry had sold four Mercedes Benz cars that had been driven by Roberts family members.

And in February, a posh Beverly Hills home used by the Robertses was sold for $3.25 million. The house, which had been part of the ORU endowment fund, turned an $825,000 profit for the school over the 1982 purchase price of $2.4 million.

According to ORU Regent Hayford, the Internal Revenue Service had asked that the lavish 17-room residence be sold because the investment appeared to benefit the Robertses personally.

Godfrey, the former ORU physiology professor, said his department--one of five in the medical school’s two-year basic-science program--had declined from 10 faculty members to two over the last several years. Replacement efforts have been unsuccessful, he said in a telephone interview, adding that at least three professors had also left the anatomy department recently.

Equipment in the basic science areas is becoming obsolete or wearing out and is not being replaced, Godfrey said.

“There are still a lot of good people there, but . . . it is not out of the realm of possibility that it (the medical school) could fall on its face or lose accreditation.”

So far, the school remains fully accredited, according to Dr. Harry Jonas, secretary for the American Medical Assn.’s national accrediting body. Jonas and other members of the Liaison Committee on Medical Education made a special visit to the campus in June after medical students wrote the AMA, asking it to investigate the missionary scholarship program and other problems.

Jonas would not comment on the committee’s findings but said a full written report will be presented late next month to Oral Roberts and Edwards, the medical school’s dean. Whether any portion of the report is released, Jonas said, “is up to them.”