Home > Uncategorized > New Information Emerges in Family Christian Saga

New Information Emerges in Family Christian Saga

Free Press

An article published Sunday in the Detroit Free Press carries information not seen to this point, including the amount of kickbacks the chain received from World Vision for each child sponsor recruited. There’s too much to reprint it all here, so you’ll need to click through. A couple of highlights though:

Now, the future of 3,100 employees and 266 stores in 36 states is hanging in the balance as the company seeks a potential alternative buyer. The bankruptcy comes less than three years after three wealthy evangelical benefactors, including [Richard] Jackson, purchased the struggling chain from private equity firm Blackstone, converted it into a not-for-profit venture and donated it to FCRC [Family Christian Resource Centers].

and:

Executives told attorneys for the U.S. government and the company’s creditors that the Family Christian has not been profitable since the 2007 calendar year.

which begged the question asked by one creditor:

“If these stewards have $20 million to spend to buy a company that’s not making a profit, why wouldn’t they take that money and use it for the Dominican and Haiti and stuff like that?” said Dave Rowland of Cleveland-based Union Gospel Press. “I’m not computing here.”

The article also uncovers some practices concerning the charities FCS collected for. As we learned personally, going through the checkout there is a litany of pitches including bonus buy offers, but also charitable causes including placing Bibles in prisons, and child sponsorship:

The chain has come under scrutiny for the transfer in December of $1 million in customer donations to its parent company.

Under inquiry from attorneys after the company’s bankruptcy filing, Family Christian Vice President of Finance Ken Dady acknowledged that in-store customer donations to Christian causes are placed directly into cash registers and not physically segregated from other funds.

But he said the company adequately tracks the actual amount of the donations through accounting measures.

The one which this writer was most appalled at:

Family Christian has also benefited from customers who sign up to sponsor a third-party group called World Vision, which provides food, clothing and shelter to impoverished children throughout the world.

The chain solicits sponsorships from its customers and receives a $150 fee from World Vision for each customer who signs up and pays the monthly fee, according to records obtained by the Free Press. Family Christian receives another $35 if the customer signs up for automatic payments.

Again, you’re encouraged to read it all at The Detroit Free Press.

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