Winnipeg Christian group's charitable status revoked
Gospel Outreach head spent donations on himself and his family, CRA audit found
A Winnipeg-based evangelical group has lost its charitable status, after an audit found its director was using donated money to benefit himself and his family.
The Canada Revenue Agency has revoked the charitable status of Gospel Outreach, which claims to send children to Bible camps and help people in need.
A CRA audit of Gospel Outreach's 2009 books found that director Harold Reeve used the charity's money to fund two trips to Punta Cana, in the Dominican Republic, as well as a ski trip to Montana.
He also used the charity's money to pay the property taxes on his family's cottage in the Traverse Bay area, according to the audit.
The CRA audit found that in all, Reeve spent more than $76,000 — more than half of the $124,000 the charity spent in total in 2009 — in personal expenses for himself and his family.
Reeve has not responded to requests from CBC News for comment.
But in a letter to the CRA, Reeve wrote, "What I have done and do is for the charitable benefit of others.
"I used the organization to pay for the expenses as I deemed them to be part of the service of the organization," he added.
'He's been judged wrongly,' says board member
Gospel Outreach board member Paul Jenkins says he believes poor bookkeeping is to blame.
"I trust Harold and I feel that he's been judged wrongly," Jenkins said.
"As far as I know, the money that was given went to people in need or it went to furthering the gospel."
While Jenkins could not explain Reeve's ski trip to Montana, he said he understood that Reeve was preaching the gospel to the poor while in the Dominican Republic.
The CRA audit also found that Reeve spent $18,000 to buy 46 grocery store gift cards, with the aim of giving them to people in need.
But Reeve kept a $400 gift card for himself, gave seven cards to his relatives, four cards to his close friends, and six to people with business or personal ties to him.
At least 13 of the gift cards Reeve purchased were given to people who earned between $60,000 and $150,000 a year, the CRA found.
The audit also found that Gospel Outreach owns four vehicles and a boat. Auditors found that Reeve, his wife and a child were doing most of the driving, but there was no document to show how the vehicles were used to help the group's stated purpose.
Jenkins said the boat that was registered to the charity was used at a Bible camp in Manitoba, but officials with the camp declined to comment when contacted by CBC News.
Gospel Outreach can still operate as a charity, but because it has lost its charitable status, it can no longer issue tax receipts.
Gospel Outreach audit
Below is the Canada Revenue Agency's letter to Gospel Outreach, explaining why the group's charitable status has been revoked. The letter also details the agency's audit of the group's books and records from 2009.