Falwell Faces IRS Probe of His Liberty U.

As part of a sweeping Internal Revenue Service investigation into nearly every major television ministry, the Rev. Jerry Falwell has been notified that the IRS will begin an examination next month of Falwell’s Liberty University and may later investigate his television show, the Old Time Gospel Hour.

The IRS also is auditing the operations of major evangelists Pat Robertson and Oral Roberts, spokeswomen for both said Friday, but neither has received word on what the agency has concluded.

As previously reported, the IRS is looking into whether Robertson illegally used millions of dollars from his Christian Broadcasting Network to help finance his bid for the presidency. The investigation into the campaign has been completed. But a related inquiry into the operation of the tax-exempt network itself still is under way, according to Frankie Abourjilie, public relations director for CBN.

Audited Before

A spokesman for Falwell said that the evangelist’s organizations have been audited twice before by the IRS and it “found our books to be in good shape.” Mark DeMoss, the spokesman, said Falwell welcomed the current inquiry.

The Falwell, Robertson and Roberts investigations appear to be part of a wide-ranging probe by the IRS that began in 1987 following disclosures of widespread financial abuses by former PTL Club hosts Jim and Tammy Bakker and top PTL officials. Jim Bakker, who was indicted for wire and mail fraud this week in Charlotte, N.C., is also part of the ongoing IRS investigation, as are three of his associates, sources said.

The IRS has told Rep. J. J. Pickle (D-Tex.) that the inquiry encompasses 34 television ministries and involves nearly 100 IRS agents around the country.

The examinations are in various stages of completion, according to a letter to Pickle from Assistant IRS Commissioner Robert I. Brauer. At least six of them involved “prominent television evangelists” and two of those six entailed criminal investigations, according to the letter, which gave no names and few identifying details.

According to the letter, the IRS is investigating whether contributions to the ministries were diverted for personal use but not reported as income, whether salaries and benefits received by evangelists exceeded what is considered reasonable for tax-exempt organizations and whether donations were channeled to political activities, which is forbidden by law.

An additional three examinations of lesser-known evangelists involved criminal investigations, bringing to five the number of criminal investigations reported in the letter. Three of them have been referred to the Justice Department for possible prosecution, the letter said, while one is undergoing preliminary inspection and one has been closed.

Spokesmen for the IRS, the Justice Department and Pickle’s office declined to elaborate on the Brauer letter.