US tax rap report meant to protect INC

By: Nimfa U. Rueda-LA Correspondent - 9 years ago

A crowd gathers around the Iglesia ni Cristo cathedral in Quezon City. INQUIRER FILE PHOTO

LOS ANGELES—A former Iglesia ni Cristo (INC) minister said he took a “less explosive” approach when he reported the sect and its leaders in the Philippines for tax fraud to protect the INC congregations in the United States.

Vincent Florida, a former minister in the INC Northern Virginia congregation, said he used the Internal Revenue Service (IRS) Form 3949A, which involves a longer process for investigating suspected tax fraud, to give the congregations time to correct financial malpractices.

Florida made the statement two weeks ago in response to the sect, which questioned his decision to use IRS Form 3949A instead of the whistle-blower Form 211.

INC leaders claimed Florida did not have solid evidence to back his tax fraud report implicating the sect, its executive minister Eduardo Manalo and auditor Glicerio Santos Jr.

“Kung seryoso ka Vincent Florida sa pag-file ng report ng tax fraud laban sa INC bakit hindi ang IRS Form 211 ang ginamit mo (If you, Vincent Florida, are serious in reporting INC for tax fraud, why did you not use the IRS Form 211)?” the sect said in a blog entry titled “Answering Fallen Angels: Punto-por-Punto na Pagsagot sa mga Kumakalaban sa Pamamahala (Point-by-point Response to Those Opposing the Leadership) part 54.”

Whistle-blower program

IRS Form 211 is used as part of the tax collection agency’s whistle-blower program that awards informants 15 to 30 percent of the tax collected.

Florida said he deliberately chose not to use the whistle-blower form, which he compared to a “bomb” that could destroy the sect.

“Let me give you an analogy. If you have vermin in your house, there are two ways to get rid of them: hire an exterminator or burn the house down,” he said.

“Both will get rid of the vermin, but the [the second way] leaves you homeless. I consider (IRS) Form 211 analogous to the burning-your-house-down approach,” he said.

The 65-year-old former minister said he was also not interested in any monetary award.

IRS Form 3949A is used for reporting suspected tax fraud, including false exemptions or deductions, kickbacks, false or altered document, failure to pay tax, unreported income and organized crime—without the IRS whistle-blower program’s monetary award provision.

Florida said he deliberately chose the form involving “a longer investigation lead time” to give the INC leadership and “anyone else who received income from the US congregations” time to cooperate with the US government and make the appropriate tax declarations.

“I want to make them recognize that what they are doing is illegal … and make them stop what they are doing,” he said. “I wanted to protect the congregations’ finance officers and, most especially, the church.”

In Manila, there was no immediate comment from the INC leadership on Thursday. The Inquirer’s text messages to INC spokesperson Edwil Zabala requesting comment remained unanswered as of press time.

Tax evasion

Florida said many churches in the United States had lost their nonprofit status because of tax evasion and “offerings being used for personal gain.”

Florida said that when he served as minister he cautioned the district auditor about the financial malpractices.

“[The auditor] told me that I was the only one in the district who complained about it and ignored my concerns,” said Florida, who left the sect on July 30 following allegations of corruption in the sect and the abduction of ministers critical of the INC leadership.

“I could no longer be a part of these wrongdoings and I stepped down,” he said.

In an earlier interview with the Inquirer, Florida claimed only checks received as offerings from members during bi-weekly worship services were deposited in the bank

He said the congregations had been directed to convert cash collections into $100 bills and to turn over the money to district auditors.

The auditors, he alleged, remitted the cash to Santos during pastoral visits “without record keeping.”

Florida said the Mid-Atlantic district alone, which included his former congregation, turned over about $150,000 in cash to Santos four times a year for the past six years.

The IRS declined to comment on the tax fraud report filed by Florida.

“Federal law prohibits the IRS from discussing specific taxpayers,” IRS spokesperson Dean J. Patterson told the Inquirer.

The IRS has not yet opened an investigation of INC as of this reporting.

According to the IRS website, once an investigation is opened, a special agent will obtain evidence by conducting interviews of third party witnesses, doing surveillance, executing search warrants, subpoenaing bank records and reviewing financial data.