Hillsong Church has denied whistleblower accusations it intentionally deceived the Australian charities regulator about its financial records, in a defence filed to the Federal Court.
The megachurch is being sued in a Fair Work case by Natalie Moses, who alleges she was unfairly suspended from her role in the finance department after she complained about financial misconduct and questionable expenditures inside Hillsong.
Ms Moses's 25-page statement of claim filed in August alleged dubious financial record-keeping, the misappropriation of church finances, and accusations Hillsong leaders used tax-free money for "large cash gifts" to Hillsong founder Brian Houston and his family.
Lawyers for the church's subsidiary, Hillsong CityCare, strenuously denied these accusations in a defence they filed on Friday.
The defence said the church's transfer of money overseas was not in breach of Australian regulations and its international operations were not subject to its external conduct standards.
The defence stated "Hillsong would not look to do anything illegitimate, but had charitable entities in countries outside Australia" so it could make legal payments outside of the country.
These overseas projects included $3.5 million in PPE (personal protective equipment) it donated to a charity in India and a fundraising appeal for Ukraine in the wake of the Russian invasion earlier this year. Both of these projects were organised by Hillsong congregation members.
The megachurch's defence was filed amid it being investigated by the Australian Charities and Not-for-Profits Commission (ACNC), which has been examining a number of Hillsong's subsidiaries' compliance obligations since March.
Ms Moses said she had uncovered the alleged questionable bookkeeping and expenditures after being tasked by chief financial officer Peter Ridley, a named defendant, to prepare an internal audit ahead of the ACNC investigation.
Ms Moses's statement of claim alleged Mr Ridley misled the charity regulator after he told ACNC investigators that Hillsong did not send money overseas beyond small purchases and that its US operations were disassociated from its Australian entities.
She alleged Mr Ridley asked Ms Moses to come up with an acceptable story — something the whistleblower had characterised as "lies" — to explain transactions between Hillsong's global entities.
Hillsong's lawyers in its defence rebuked these claims and denied Mr Ridley had become "angry and dismissive" towards Ms Moses when she raised her concerns about the church's potential illegal and unethical financial conduct.
Its defence said a Hillsong manager even reassured Ms Moses that if any issues were identified as part of the ACNC investigation, "then Hillsong would move to correct the issue proactively".
Hillsong said it sought independent advice about Hillsong Foundation's use of tax-deductible donations to renovate Melbourne's iconic "Festival Hall", which was purchased by a Hillsong-related entity in 2020.
Ms Moses allegedly warned Mr Ridley the church may be committing fraud and misleading its followers by spending money it was falsely claiming was tax deductible.
In its defence, Hillsong said its use of donations on Festival Hall renovations was not in breach of the ACNC Act and that it received an independent audit report from global accounting firm Ernst & Young that its processes were compliant.
Hillsong's defence filing showed this independent audit was officially received two weeks after Ms Moses filed her statement of claim in August.
Ms Moses had alleged the Australian Hillsong leadership team moved to suspend her, under the pretence she had breached IT policy after downloading huge swathes of internal documents, after she refused a directive to deceive regulators about its overseas activities.
The church said the amount of data she downloaded — about 40,000 documents in one weekend in June — was outside the scope of her role. It claimed it launched a broad IT monitoring process of its systems after a media report in March referred to confidential church documents.
Ms Moses previously claimed her access to these documents was necessary to her role.
Ms Moses's lawyers at Maurice Blackburn declined to comment. The matter is due to return to the Federal Court in February next year.
