Tennessee’s largest ashram was under scrutiny after state investigators found it “failed to provide adequate financial controls to ensure compliance with state and federal regulations, including its own,” according to a scathing audit of the Ashram, which the Tennessee Department of Financial Services (DFS) is reviewing.
The audit, issued Tuesday, found “multiple violations” at the Ashrams annual fundraising dinners, including the sale of the property to a third party.
The Ashram’s annual fundraising dinner is the largest in the country and hosts a large amount of donations from people all over the country.
It was closed down in July 2017.
The state Department of Revenue (DOER) issued a “notice of violation” to the Ashams board of directors in June 2016 for violations of the state’s charitable status law.
The Ashrams board did not respond to requests for comment.
“The board of trustees failed to comply with applicable state and Federal law governing the operation of a charitable organization and failed to provide proper financial controls,” the audit found.
In addition, the audit noted that the board’s leadership did not provide a detailed written accounting of the funds raised by the Asharam, which led to the financial losses.
The board also did not report the “large amount of money raised by individuals, organizations and corporations to the DFS.”
The audit found the board did NOT provide an accurate accounting of any donations received by the ashrams, which totaled $1.6 million.
“Failure to adequately account for all charitable contributions received, and failure to maintain accurate and complete tax records, could result in substantial financial loss,” the auditor said.
The auditor said the board also failed to follow the rules governing the purchase of the ashram by a company called The Ashram Foundation, which is controlled by a separate group.
The DFS has not yet responded to a request for comment from Politico.
Tennessee Attorney General Bill McCollum has launched an investigation into the Ashmarts financial records and will determine whether to bring criminal charges against the board, the state board of county commissioners, the board of supervisors and other officials.