Mormons reportedly stockpile $100 billion in donations, not using them for the designated charitable work but to buttress businesses

December 17, 2019 • 1:15 pm

A long report in yesterday’s Washington Post details some allegedly nefarious behavior of the Mormon Church: accumulating donations of members to the tune of billions of dollars, saying that they’re tax-empt funds, and then not using them for charitable purposes as that money accumulated interest and capital gains, which violates the law. You can read about it at the link below (click on screenshot). If you hit a paywall, try judicious inquiry.

This resembles the latest accusation that a Vatican Fund, Peter’s Pence, has also accumulated lots of money for charitable work, but then used almost all of it to reduce the Vatican’s debt (see my post here).

The new accusations come from a Mormon, David Nielson, who manages a portfolio into which the Mormon Church’s excess donations come. As you may know, the Church is extremely wealthy because Mormons tithe 10% of their yearly income to the Church, and many Mormons have a substantial income. The tithes amount to about $7 billion per year, and only $6 billion of that is need to cover the Church’s operating costs. The rest has been sequestered over the years in a fund called “Ensign Peak Advisors,” for which Nielson works as a senior portfolio manager.  The accumulated dosh in that account is over $100 billion, and of course grows because it’s invested.

The problem is that none of that money appears to have been used for charitable purposes, even though it should be given that Ensign is registered as a not-for-profit organization. In fact, the only disbursements that appear to have been made from Ensign were illegal: to two for-profit concerns. All of this is illegal. As the article reports:

Philip Hackney, a former IRS official who teaches tax law at the University of Pittsburgh, said the complaint raised a “legitimate concern” about whether the church’s investment arm deserved its tax-exempt status.

“If you have a charity that simply amasses a war chest year after year and does not spend any money for charity purposes, that does not meet the requirements of tax law,” Hackney said in an interview. Hackney, who served in the IRS chief counsel’s office, has been retained by The Post to analyze the whistleblower documents.

IRS rules dictate that a nonprofit organization must carry out charitable activity that is “commensurate in scope with its financial resources” to maintain its tax-exempt status. No threshold for this test is specified, and the agency instead considers examples case by case.

Now this isn’t all for sure, as Nielson appears to have provided no evidence for lack of charitable spending beyond his claim that no money went for that purpose. However, there should be records if it was. And get this rationalization from other Mormons:

In a speech in March 2018, Caussé linked the church’s financial strategy to the “prophecies about the last days.” Just as the church maintains grain silos and emergency warehouses, Caussé said, so it “also methodically follows the practice of setting aside a portion of its revenues each year to prepare for any possible future needs.”

According to the complaint, Ensign’s president, Roger Clarke, has told others that the amassed funds would be used in the event of the second coming of Christ. Clarke did not respond to an email seeking comment.

They’re going to wait a very long time for that! Besides not giving money from Ensign to the needy, the Church is also sitting on billions of dollars worth of real estate. And, unlike other nonprofit organizations, churches are exempt from having to give public reports of their income and assets. That seems to be an unwarranted and probably unconstitutional coddling of religion. (In contrast, the Post reports the value of the Bill and Melinda Gates Foundation’s holdings at $47.8 billion—less than half of Ensign’s money alone).

So how was the money used? Nielsen says that $2 billion went to “bail out a church-run insurance company and a shopping mall in Salt Lake City that was a joint venture between the church and a major real estate company.”

You can read the rest for yourself, and of course caveat emptor since this is still playing out. (Also, Nielsen, as a tax whistleblower, gets 10% of what the government recovers in unpaid taxes.)

Just remember that the Mormons, like the Catholic Church, seem to be hoarding money designated for charity and using it for other purposes—or waiting to dispense it when Jesus returns. (Does this mean that all the saved are going to get Ferraris?). But when Jesus comes back—I’m just joking! He ain’t gonna!)—both the Vatican and the Church of Jesus Christ of Latter-Day Saints will have some ‘splaing to do. There may even be lashing by the Savior in Temple Square!

Ensign remains mum, as does the Church itself. We’ll see how far a Republican government (if we still have one in 13 months) will go in prosecuting a church.

h/t: Muffy

 

23 thoughts on “Mormons reportedly stockpile $100 billion in donations, not using them for the designated charitable work but to buttress businesses

    1. Suppose he/she/they were a real entity. Why would they need money?

      “Excuse me, why does God need a star ship?”

      (Kirk, Star Trek V: The Final Frontier)

  1. And this is where being a whistleblower can really pay off. I’ll take 10% of that. Of course what should be done to fix all of this corruption in the churches is to make them pay taxes. We also know that is not going to happen. Money laundering and tax evasion are the favorite thing in the Catholic church so why not the Mormons as well. I think the Catholics are the richest of all but the Mormons come in something like 3rd or 4th in the world. It is a great deal and no impeachment.

  2. Maybe they’ll use some of the charity donations for a Romney Presidential bid in 2024! Wouldn’t put it past ’em.

    Joking aside, it’s amazing how greedy religious institutions are. If they actually put their money where their faith teaches, they could solve world hunger. That’s something I could get behind, yet it seems these rich institutions are in it for themselves and don’t give a wit about the public good, unless it’s in their flock’s interest.

    1. You can read about the Churches nefarious dealings during WWII where Nazis were preferred to Marxists so they pretty much went all in with Hitler and Mussolini. Top clergy were taken from the pool of bankers for a very good reason.

    2. ” . . . they could solve world hunger.”

      By also funding birth control. (Unless they are Catholic in their attitude toward the matter. Or capitalist? Don’t want anything to happen to negatively affect the consumer market.)

  3. So is this just coincidence or what? Is Ensign Peak Advisors a private equity fund or maybe a hedge fund? And what was it that Mitt Romney use to do besides politics? He ran a private equity firm called Bain Capital. So do you think he might have something to do with this??

  4. Sick, sick, sick. This is prima facie evidence of mind control and brain washing if ever there were any. I know first hand, having been involved with such corruption and money grubbing for many years.

  5. It kind of surprises me, on the one hand, that this kind of fraud isn’t more easily detected. The IRS should have found out years ago and shut it down (assuming the story is true). On the other hand, in the US giving religion a pass is so deeply ingrained, all they have to do is duck quietly behind the robes of faith and the feds give a blind eye. Remember faith-based initiatives started, I think, by Bush, but continued, I think, by Obama? You might as well let the churches run a gambling casino in the basement.

    1. The IRS has been systematically slashed and burned by Republicans in the last few years (or is it decades?) – you don’t have to be a religious organization. Tax cheating is not a real problem, only government overreach is, doncha know.

      1. It seems the Republican party is dedicated to shifting our form of government towards $plutocracy$. You can already use that term appropriately, but I think the GOP things we have a ways to go before they’ll be satisfied. That’s why I think Ayn Randian libertarianism is such a danger. There’s a lot of that going around.

  6. The Utah papers covered this scandal today. It will probably remain the biggest news item for days if not weeks. It will give Utahns something to anguish over besides the presidential impeachment proceedings. I was born in Utah and have lived in Utah nearly my entire life (besides the part I haven’t finished yet), about 70 of 73 years.

    Someday there may be some compelling reason for self examination by the Mormon Church and its acolytes. But I am not very hopeful right now. Only one of our Congressional delegation supports the impeachment proceedings. Rep. Ben McAdams just today announced he would vote for the articles od impeachment. Watching his career I expected he would stand up. Strangely he is an active Mormon. Sen. Romney is uncommitted as I understand his position. The other four all oppose proceeding with the trial. We are at a moment of reckoning about the kind of integrity professing being a Mormon requires. I am not sure what the outcome will be but I am not hopeful. My Mormon roots trace back to April 9, 1832 but I no longer engage with the Mormon church although all my siblings remain among the faithful. I have not been able to grasp the current convictions of the faithful.

    Somewhere in downtown SLC a group of old men are discussing how to present this situation to their faithful in a way that solidifies the community. That will probably be the easy part. They are also looking at their legal defense. In the 1990s the Mormon church supposedly divested themselves of the profit making entities they owned. As I understand the history they kept some corporations but sequestered them in a church owned corporation that I believe paid taxes on profits.

    1. Somewhere in downtown SLC a group of old men are discussing how to present this situation to their faithful in a way that solidifies the community.

      Yep. I had a close-up view of when the Mormons fought to keep nonprofit status for the Polynesian Cultural Center in Hawaii (big money maker) in the 70s. It really galvanized them.

  7. I always am impressed with whistleblowers, It takes a lot of courage and he’s got a lot to lose if he’s wrong.

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  8. Demonizing OR eulogizing capitalism is beside the point. So is asking if you would prefer communism; that’s misguided rhetoric. The point being that capitalism is not intrinsically democratic, and that’s the thing that should worry the West.

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