The Church of Jesus Christ of Latter-day Saints, commonly referred to as the Mormon church, has been fined millions of dollars for supposedly hiding the size and scope of its actual investments, which now likely total more than $40 billion.
The U.S. Securities and Exchange Commission announced on Tuesday that it had conducted an extensive investigation into the finances of the LDS church that stretched back decades. According to the SEC, between 1997 and 2019, the church and its investment firm, Ensign Peak, funneled funds through 13 shell companies in order to obscure the extent of the church's assets, which are currently estimated to be close to $44 billion. The LDS church manages to maintain such a well-stocked treasury because it asks its members to donate a tenth of their earnings, a biblical practice known as "tithing."
The SEC statement claimed that church and firm leaders believed that the LDS church would face "negative consequences," should the full scope of its investments be made known. To prevent that from happening, "the LDS Church’s investment manager, with the Church’s knowledge, went to great lengths to avoid disclosing the Church’s investments," the SEC said.
The SEC also alleged that the names of different church leaders were utilized on various disclosure forms to further obfuscate the appropriation of funds. Meanwhile, the church and Ensign Peak had actually invested heavily in global enterprises, like Apple, Microsoft, United Health, Google, Exxon Mobil, and Doe Chemical, the Daily Mail reported.
The allegedly hidden investments were brought to the attention of the SEC in 2019 when David Nielsen, a whistleblower from within Ensign Peak, came forward. This month, Neilsen submitted a 90-page filing to the U.S. Senate Finance Committee, demanding further oversight, according to KTVB.
The SEC statement did not specify how much money the church supposedly shielded from public view, but the church was assessed a fine of $5 million. Ensign Peak has covered the lion's share of the fine, $4 million, while the church has assumed responsibility for the remainder.
In its own statement regarding the fine, the LDS church claimed that it had not intended to mislead the feds, its membership, or the public.
"Since 2000, Ensign Peak received and relied upon legal counsel regarding how to comply with its reporting obligations while attempting to maintain the privacy of the portfolio," the church statement read. "As a result, Ensign Peak established separate companies (LLCs) that each filed Forms 13F instead of a single aggregated filing. Ensign Peak and the Church believe that all securities required to be reported were included in the filings by the separate companies.
"We affirm our commitment to comply with the law, regret mistakes made, and now consider this matter closed," the statement concluded.
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