It's Time for a Real Apology and Accountability from the First Presidency, and Complete Transparency in the Church's Finances

    I'm sure  a lot of members of the Church of Jesus Christ of Latter-day Saints are either unaware of the recent SEC action against the church, or read the church's official statement that downplays it and makes it sound like a simple error in filing paperwork and just went on with their lives. I kind of wish I had done that, instead of digging deeper. If you want to hold onto the perception that the church leaders are righteous, kindly old men who are constantly following revelation, don't read past this, because what they've done is just plain wrong. 

    First, the background: the church created Ensign Peak to manage the church's investments. Ensign Peak is a non-profit, does not charge the church management fees, and has no shareholders or members. When it was started, Ensign Peak managed approximately $7 billion of church assets. (Yes, all of the numbers we are talking about are BILLIONS, with a B.) Ensign Peak was required to file Forms 13F to report the fair market value of the securities it manages. The church realized that if that happened, their financials would become public knowledge, which they felt would "lead to negative consequences." To avoid this, the church created a trust and an LLC to file the 13F forms. This was the first shell corporation, with an address in California (to avoid any association with the church in Utah.) 

    The illegality of this setup started here. Ensign Peak was required to give investment discretion to the investment managers of the LLC, but didn't. They maintained complete control. By 2005, the church realized that this first LLC could be linked back to them because the person signing the 13F was a church employee. To fix this, the leadership of the church approved the creation of another LLC, with “better care being taken to ensure that neither the ‘Street’ nor the media [could] connect the new entity to Ensign Peak.” (Keep in mind that at this point the internet was becoming a common source of information, so they would have to try harder to hide things.) By 2011, the portfolio was large enough that it might "attract unwanted attention," so Ensign Peak, with approval from the church's senior leadership, created 5 new clone LLCs. In 2015, a third party connected the holdings of these clone LLCs to Ensign Peak (which would also link them to the church.) The senior leadership of the Church approved Ensign Peak’s recommendation to “gradually and carefully adapt Ensign Peak’s corporate structure to strengthen the portfolio’s confidentiality” by creating 6 additional clone LLCs. Ensign Peak (which is controlled by the church) had complete authority over all of these LLCs, but was designated as a client of the shell companies. 

    Each LLC was assigned a "business manager" who actually worked for Ensign Peak, and each of these managers was supposed to have responsibility for the preparation and filing of governmental reports and such. In reality, the only duty they had was to sign the signature page on the 13F forms. These "business managers" were selected not because of their education, experience, or ability, but because they "had common names and a limited presence on social media, and were therefore less likely to be publicly connected to Ensign Peak or the Church." Every clone LLC had an address outside of Utah, again to make it more difficult to trace it back to Ensign Peak or the church. Ensign Peaks' senior management drafted and even filed the 13F Forms before even getting the "business manager's" signatures! Every one of these 13F forms falsely stated that each LLC had sole investment discretion and that there were no other managers for those securities. Ensign Peak only gave the "business managers" the signature page and not the complete documents, so the "business managers" really had no idea what was going on with the investments. 

    At least once a year, Ensign Peak's managing director met with the church's senior leadership to discuss their activities, including the LLC structure. In 2014 and 2017 the Church Auditing Department reviewed the LLC structure and highlighted the risk that the SEC might not agree with their approach, although they didn't give any advice on specific changes. In 2018, a website reported that entities affiliated with the church were connected with some of the LLCs. When this information came out, 2 "business managers" resigned and voiced concerns about what they had been asked to do. (This may be referring to David Nielsen, a former Ensign Peak employee, who filed a whistleblower case with the IRS, and who spoke out because Ensign Peak had $100 billion worth of holdings that it was not using for charitable purposes.) In February 2020, Ensign Peak finally filed a consolidated Form 13F for securities valued at $37 billion. 

    Almost all of this information comes straight from the SEC's Order, which you can read in its entirety here. From what I understand, the church (leaders and legal department) would have had input into and agreement with what was included. That makes their official statement (found here) a bit disingenuous. In their statement, they not only avoid taking responsibility, but downplay it to make it sound like it was a clerical error for not filing the right government form. They then shut the door on any discussion by saying the matter is now closed. I beg to differ. 

Major Issues I have with this:

1) There was blatant dishonesty in the intent to hide the church's assets. 

2) The fact that they wanted to hide the assets at all is problematic. There is not one single reason they could give that would be good enough to explain why they wanted to hide their wealth. They should be transparent with their tithe-paying members and the world at large about how much they have and what they are doing with it. Those are basic financials that most people would want to see before donating to any charitable organization (and that the majority freely provide.) 

3) They not only worked to hide the assets, but did it in such sneaky, deceptive ways. They involved multiple "managers" who were chosen specifically because they had common names and limited social media presence, to make it even less likely that these "clone LLCs" would be tied back to the church. 

4) At every step, the highest church leaders were complicit. Nothing was done without their approval and direction. This is what happens when three men are given so much control over one of the biggest financial empires in the world. There was no real oversight, no accountability, and no transparency. 

5) The church's own auditing department highlighted the risk of using such sneaky practices in 2014 and 2017, but they didn't end the practices. They continued to have the church auditing department make the worthless claim in general conferences that "Based upon audits performed, the Church Auditing Department is of the opinion that, in all material respects, contributions received, expenditures made, and assets of the Church for the year 2014 [2017] have been recorded and administered in accordance with approved Church budgets, policies, and accounting practices. The Church follows the practices taught to its members of living within a budget, avoiding debt, and saving against a time of need." 

This obscure and standardized statement doesn't actually tell the members how any of the tithes are being used, and there is not enough transparency for anyone to know if what they are saying is true or not. They just stand up and read this same exact statement every year, as if that should be good enough.

6) I have to assume that most of the people involved in this still have current temple recommends, which begs the question... "how?" They were not being honest in their dealings with their fellow men, a question asked at every interview. People are kept out of the temple for not paying their tithing, but these men are still allowed in (and to dedicate the buildings!) even though they have not been honest in how they have dealt with their fellow men (members, the public, and the government.) Not to mention being complicit in requiring others to be dishonest in their dealings. 

7) Why the hell is the church sitting on 37 BILLION dollars in the first place? (Keep in mind, that's not the total or overall wealth of the church- this is just the church's US investments!!) I understand living with a budget, avoiding debt, and saving against a time of need, but there's a difference between doing those things and sitting on a hoard of gold like Smaug in Lord of the Rings. I'm pretty sure the leaders aren't benefitting directly from the church's wealth, so I don't think that's an issue. But why aren't they using a lot more of this money to help the poor and needy? You know, the people JESUS was most worried about? They could easily spend at least 10% of their wealth (or even 10% of the interest on their wealth) every year and still have plenty to keep the church going forever. But they don't even do that much. They expect us to pay a full 10% AND serve in callings, and clean the buildings, and take care of each other while the church cuts back on things like helping ward members in need, building maintenance crews, janitors and ward budgets. And I don't want to hear lame excuses about needing to save for a "rainy day"- there have been lots of rainy days (floods, earthquakes, droughts, famines, a global pandemic, severe poverty, and other needs) that they could be helping with. I also think they need to follow their own teachings and have faith that they will have what they need when they need it. Just like they tell their members, who often struggle to pay tithing and still have money to put food on the table. Spend the money and have faith that the Lord will continue to provide!! We have become a rather elitist organization in the United States, one that wants members who can take care of themselves, dress nice on Sunday, pay their tithing, and not ask the hard questions. How is that welcoming to the people Jesus was most likely to be found ministering to and welcoming into His inner circle? I've had issues with this for awhile, but this scandal is really bringing it front and center.

8) This is a serious betrayal of trust. It isn't a little "mistake" that was made, and regret isn't good enough. For a breach of trust this serious, they should be apologizing for their very specific roles in this. They should a) promise that it will never happen again, b) tell us what measures they will put in place to ensure it doesn't and c) create complete transparency in the church's finances. What they have done is akin to a spouse who has cheated saying "I'm sorry a mistake was made," I quit doing it, so let's just forget about it. Trust has to be re-earned when there's such a deep betrayal, and that can't happen if they try to just sweep it under the rug (as they are akin to do with many unpleasantries.) 

    What's really sad is that I never had any issues with paying tithing to the church. I always saw it as giving back to God, and believed the church when they said “We take seriously the responsibility to care for the tithes and donations received from members. The vast majority of these funds are used immediately to meet the needs of the growing church including more meetinghouses, temples, education, humanitarian work and missionary efforts throughout the world. Over many years, a portion is methodically safeguarded through wise financial management and the building of a prudent reserve for the future." (https://www.deseret.com/utah/2019/12/17/21026182/mormon-lds-church-washington-post-whistleblower-irs-complaint-taxes-ensign-peak) (The vast majority, huh? I think they have a different definition of that phrase than I do.) Now, I feel like I would have to pay tithing if I want to go to the temple or continue attending BYU-Idaho, but my conscience says that it isn't right to entrust sacred funds to a church that really is acting a lot more like a corporation than a charity. I believe tithing is meant to provide for the needs of the church (everything they listed in the statement above) but it's also supposed to be for helping the poor and needy. When the church has enough to keep the day to day business of the organization going for hundreds of years with their stockpile of wealth, the focus should be shifted to alleviating the needs of those less fortunate than us. Jesus was far more concerned about the "least of these" than He was in building a rainy day fund. 

    Maybe the church leadership needs to be reminded about Jesus' thoughts on excessive wealth. Here are a few: “Lay not up for yourselves treasures upon earth, where moth and rust doth corrupt, and where thieves break through and steal” (Matt. 6:19) “How hard is it for them that trust in riches to enter into the kingdom of God! It is easier for a camel to go through the eye of a needle, than for a rich man to enter into the kingdom of God” (Mark 10:24–25) "No man can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon." (Matthew 6:24) "There was a certain rich man, which was clothed in purple and fine linen, and fared sumptuously every day: And there was a certain beggar named Lazarus, which was laid at his gate, full of sores, And desiring to be fed with the crumbs which fell from the rich man’s table: moreover the dogs came and licked his sores. And it came to pass, that the beggar died, and was carried by the angels into Abraham’s bosom: the rich man also died, and was buried; And in hell he lift up his eyes, being in torments, and seeth Abraham afar off, and Lazarus in his bosom. And he cried and said, Father Abraham, have mercy on me, and send Lazarus, that he may dip the tip of his finger in water, and cool my tongue; for I am tormented in this flame. But Abraham said, Son, remember that thou in thy lifetime receivedst thy good things, and likewise Lazarus evil things: but now he is comforted, and thou art tormented." (Luke 16:19-25)

I don't know how things are going to look for me moving forward with the Church of Jesus Christ of Latter-day Saints. I hate that a few men at the top have ruined many of the good feelings I had towards them and the church, especially since I believe most of the doctrine, I've experienced many wonderful spiritual experiences within it, and there are so many really good people in the pews each week. How do I stay in light of this (and other issues) without being untrue to my core values? How do I hold on to what is good and right but not ignore what is horribly wrong?