THOMASVILLE, N.C. – Michael C. Blackwell, longtime president and CEO of the Baptist Children’s Homes (BCH) of North Carolina, is retiring from his post effective immediately following an independent financial review revealed multiple instances of misuse of the organization’s funds.
An announcement from BCH on Tuesday (Sept. 19) said its board of trustees reached an agreement with Blackwell earlier in the day for him to retire. Blackwell has been on a leave of absence since May 26.
The announcement said, “Both parties have agreed that moving in the direction of new leadership is in the best interest of the organization and its mission of ‘sharing hope…changing lives.’”
“While the outcome of this review was disappointing, the action taken by the trustees clearly prioritizes that the integrity of the BCH mission and, most importantly, our commitment to the children and families we serve comes first,” Gayla Freeman, chair of the BCH executive committee, said in a statement. “It is our hope that this is the first step in rebuilding trust with our supporters, partners and NC Baptists who have faithfully stood with us to minister to the needs of the most vulnerable while showing them God’s unconditional love.”
Freeman added that the misuse of funds was “not systemic” but was “isolated to the former President/CEO.”
BCH officials also released a detailed summary of the financial review, which was conducted by the Schell Bray law practice.
The review involved a forensic accountant’s assessment of specific organizational expenditures by Blackwell and “the findings substantiated multiple instances of misuse directly conflicting with both BCH policies and Blackwell’s fiduciary duties.”
Among the findings were Blackwell’s use of a specific accounting code for personal expenses. Over the past 14 years, Blackwell directed more than $300,000 in donor funds to that account. Investigators also found that he used his corporate American Express card for personal expenses, including stays at a luxury resort, and that he asked a donor to purchase a brand-new Nissan Altima for his wife in 2022.
“… Dr. Blackwell directed [Donor Redacted] gifts away from their purpose of supporting BCH’s general operations to benefit himself, and he was not fully transparent with donors …,” the Schell Bray summary states.
In an email statement sent to some Baptist State Convention of North Carolina leaders as well as the Biblical Recorder about three hours after BCH’s announcement was made public, Blackwell said that he “had never deliberately done anything to bring harm to this ministry that is so deeply personal to me.”
Blackwell said he shared that sentiment with members of the BCH board of trustees when he was invited to meet with them during a special called meeting that was held in closed session on Thursday, Sept. 13.
In his statement, Blackwell acknowledged the existence of a “special Discretionary Fund” and said he “never stepped outside the original, established parameters and purpose of the Fund.”
Blackwell added that at some point he “did determine that some charges were, indeed, personal. I made note of those and reimbursed BCH for those charges.”
He added: “There was no intentional misuse of funds.”
In a follow-up interview with the Recorder, Blackwell reiterated the claims he made in his statement.
“There were some misunderstandings, [but] there certainly was no deliberate misuse of anything, ever on my part,” Blackwell told the Recorder. “I love BCH, and I always will.”
Blackwell also said the decision to retire was his.
“I retired on my own,” Blackwell said. “That was my decision.”
Under terms of the separation, Blackwell has agreed to reimburse BCH in full for the funds that were identified. Additionally, he will pay the appropriate amount of applicable taxes. Blackwell’s final compensation will consist only of that which is required by law, and BCH policy regarding accrued vacation and sick time, the statement said.
The review also determined that BCH’s bylaws, as currently written, give the president/CEO position too wide a margin of financial authority.
Freeman said the BCH board is in the process of developing a plan for updating and strengthening governing structures to establish the degree of oversight that is essential for an organization of the BCH’s size and scope.
The BCH’s announcement also said a search committee would be formed “in the coming weeks” to identify a new executive leader for the organization.
BCH Chief Operating Officer Keith Henry and Executive Vice President for Development Brenda Gray, who have shared presidential responsibilities since Blackwell’s leave began in May, will continue to lead the organization in the interim.
Blackwell, 81, is the longest-tenured president in BCH history, having led the organization for nearly 40 years. A native of Gastonia, N.C., Blackwell became BCH’s eighth president on July 1, 1983.
In a statement to the Biblical Recorder, N.C. Baptist Executive Director-Treasurer Todd Unzicker praised BCH trustees for commissioning the financial review and commended them for “taking swift action upon receiving the audit’s results.”
“It was disheartening and appalling to read a summary of actions that occurred under Dr. Blackwell’s leadership,” Unzicker said. “Transparency is the currency of trust for N.C. Baptist churches and this report clearly demonstrates that the actions of Dr. Blackwell not only represent a lack of transparency but also a misappropriation of cherished missions dollars. As heartbreaking as these actions are, it encourages me to see BCH trustees move toward a change in executive leadership and seek full restitution.”
Unzicker pledged assistance to the Baptist Children’s Homes in the days ahead and called on N.C. Baptists to join him in praying for the BCH’s ongoing ministry.
“N.C. Baptists stand ready to assist BCH in the days ahead as they work to change their policies and set a new direction,” Unzicker said. “Please join me in praying for wisdom for them in the days ahead.”
The Baptist Children’s Homes of North Carolina was established in 1885 as a single orphanage in Thomasville. BCH has grown from its inaugural location into one of the southeast’s largest child care organizations, located in 35 communities in North Carolina, South Carolina and Guatemala.
The nonprofit organization, which is fueled by charitable funding provided by churches and donors, offers help and hope to children, families, single mothers, expectant mothers, adoptive families, college students, intellectually and developmentally disabled adults, and aging adults.
Baptist Press contributed to this report.
