The document said it also had no nonexecutive directors or a board to which EPA had to report. The Mormon Church and its investment adviser will pay millions to settle charges with the SEC. Clarke told the Journal, We dont have any idea whether financial assets will have any value at all during a second coming. Leaders of EPA declined to comment in the original stories at ReligionUnplugged.com. Over many years, a portion is methodically safeguarded through wise financial management and the building of a prudent reserve for the future., The Wall Street Journal, which didnt cover the story until February 2020,made a unique contributionby visiting Salt Lake City and interviewing leaders of EPA and the church who confirmed the previous reporting ofReligionUnpluggedandthe Post. As Deuteronomy 14:28-29 makes clear, the church is supposed to use the tithes collected to actually help those in need: 28 At the end of every three years, bring all the tithes of that years produce and store it in your towns, 29 so that the Levites (who have no allotment or inheritance of their own) and the foreigners, the fatherless and the widows who live in your towns may come and eat and be satisfied, and so that the Lord your God may bless you in all the work of your hands.". Just last year, Prophet Russell M. Nelson did a worldwide speaking tour where he told members in Africa that only paying tithing can get them out of the cycle of poverty. Again, the church refuses to be transparent with their members as they enjoy the benefits of being a tax exempt corporation. That touched off waves of new scrutiny for a global church used to keeping the slimmest of financial profiles. Ensign Peak also has at least $1.3 billion in shares of oil and gas companies, even after dumping 44% of its stock in Exxon Mobil early in 2020. Ensign Peak's investing strategy turns the $100 into $150 (Ensign Peak pays no tax on the gain because its passive . A former employee of a $100 billion investment fund owned by The Church of Jesus Christ of Latter-day Saints has submitted a memorandum to the U.S. Senate Finance Committee and its subcommittee on taxation and IRS oversight about the operations of the Salt Lake City-based Ensign Peak Advisors Inc. Former employees said the fund mushroomed from about $40 billion in 2012 to around $100 billion by 2019. 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. Back to the article: Others may not be as concerned. I will never claim to speak for Jesus, but it's beyond clear that the leaders of this church never have either whether it's claiming God called the Native Americans Lamanites from Israel, that dark skin is a curse from God, or that God changed his mind in just 3.5 years on treating LGBT members as apostates. There might be ways to get there with creative accounting such as including what the church gives in assistance to members on the ward level, but remember again that local help is heavily funded by members on the local level and is also a way to evade the matter at hand which is how the church handles tithing contributions. When we shut down critical thinking, it allows those who claim authority from God to abuse that trust over and over again, which we have seen from the days of Joseph Smith promising exaltation to marry the young daughters of early members through today with finances, interviews with children, or shutting down questions about church history. Hes on Twitter @PaulGlader. That strategy, Clarke said, was designed to prevent members from parroting what Ensign was doing and to, as the paper stated, protect them from mismanaging their own funds with insufficient information., Church officials described the fund as a rainy-day account and to help fund operations in poorer parts of the world such as Africa, where the faith is booming where member donations cant keep up.". The church contended no actual tithing was ever used and instead came from Ensign Peaks earnings. This is yet another rationale that is contradicted by their past actions, and they are only saying it to try and pacify members who are waking up to realize that this church is not only untrue, but not good, either. It wouldnt completely shock me if the reporting kickstarted the disclosure, said Sam Brunson, a law professor specializing in tax law at Loyola University of Chicago and a practicing Latter-day Saint. The final section of the article: Clarke also told The Journal he was misunderstood by Nielsen, who asserted that Clarke had said the church had mustered the money for Christs Second Coming. Roger Clarke, head of Ensign Peak (Wall Street Journal): "So they never wanted to be in a position where people felt like, you know, they shouldn't make a contribution". Manage Products and Account Information. In it, Clarke affirms the veracity of all business records submitted on Ensign Peaks role in the case, including its payments to City Creek Reserve. Not only is the church being dishonest by leading the church members to believe that they areWe are not a wealthy people but we are good people, and we share what we have" as Elder Andersen said in 2018, they are taking active steps to obfuscate their financial dealings in order to keep members thinking the church needs their money. So they never wanted to be in a position where . A Salt Lake Tribune analysis shows the next highest concentrations of its investments beyond tech are in consumer goods, health care and financial sectors, each at stakes of between 12% to 15% of Ensign Peaks total value, for shares worth a total of $8.6 billion, $6.9 billion and $6.6 billion, respectively. Even if the stock market dropped 30%, they would *still* have enough to fund the entire church and not need a dollar more from that one investment fund alone - not even counting their for-profit ventures, vast real estate portfolio, or massive land purchases such as the gigantic ranch in Florida. Whether it's hiding church history, changing what the meaning of translation or 'curse of dark skin' is, or hiding finances in over a dozen shell companies, the leaders of this church simply do not believe that members will stick around if they are honest about their history or practices. This page was processed by aws-apollo-l2 in 0.084 seconds, Using these links will ensure access to this page indefinitely. Top editors give you the stories you want delivered right to your inbox each weekday. The church here is saying they need the $124 billion for when the "next 2008" takes place so they "won't have to stop missionary work," yet when the 'Great Recession' actually did hit, the church never tapped into the fund nor did it halt missionary work. The Church of Jesus Christ of Latter-day Saints' has a $100 billion portfolio, according to a 13F filing. (Subscription required) Next Up In Faith Ensign Peak Advisors employs 11 employees. See all articles by Roger G Clarke Roger G Clarke. Clarke, Roger G and de Silva, Harindra and Thorley, Steven, Fundamentals of Efficient Factor Investing (October 11, 2016). By 2003, Ensign Peaks assets had grown, according to court documents, though the church isnt publicly saying by how much. Suggested Citation, 60 East South Temple4th FloorSalt Lake City, UT 84111United States, 555 West 5th Street50th FloorLos Angeles, CA 90013United States213-688-3015 (Phone)213-688-8856 (Fax), 616 TNRBBrigham Young UniversityProvo, UT 84602United States801-378-6065 (Phone)801-378-5984 (Fax), Subscribe to this fee journal for more curated articles on this topic, Finance Educator: Courses, Cases & Teaching eJournal, S&P Global Market Intelligence Research Paper Series, Subscribe to this free journal for more curated articles on this topic, We use cookies to help provide and enhance our service and tailor content. as well as other partner offers and accept our, Church of Jesus Christ of Latter-Day Saints, Registration on or use of this site constitutes acceptance of our. A closer analysis of Ensign Peaks latest disclosures show that beyond big name stocks, technology in a variety of forms accounts for up to 27% of all its shares worth nearly $13.3 billion. So how does the church go from claiming $2 billion in donations over 34 years (which is overwhelmingly based on service hours that are converted to donation amounts) to $1 billion per year as church officials are claiming just months later? BYU Marriott School of Business. Financial Analysts Journal, Vol. But he filed an appeal in February of 2022 to the 9th U.S. See all articles by Roger G Clarke Roger G Clarke. The Mormon church created a system of more than a dozen shell companies to make their investments harder to track? Foreign accounts: EPA now admits having foreign accounts, after denying it under oath for 10+ years: Mr. Nielsens prior submissions demonstrated that EPA has falsely denied under oath each year since at least 2007 that EPA has long had foreign bank and investment accounts, estimated to exceed $9 billion and thus EPA is liable for FBAR (Report of Foreign Bank and Financial Accounts) penalties of more than $2 billion. The head of EPA, Roger Clarke, indicated to the Journal that EPA is a . Its holdings dwarf those ofendowments at any university,such as Stanford, Harvard or Yale. Religion Unplugged reached EPA's managing director Roger Clark by phone on Monday, offering to explain key parts of this story and to ask questions for EPA to give a response. Now he has a podcast about it. Roger Clarke, the head of Ensign Peak, said: 'Paying tithing is more of a sense of commitment than it is the church needing the money' Clarke and other officials say the money is saved. The investment activity has been the subject of. Downloads 496 (82,744) In several rounds of clashing court motions, the closely watched dispute led church attorneys to reveal innermost business details to a federal judge on some of Ensign Peaks biggest transactions including how it helped fund the City Creek Center mall in downtown Salt Lake City. Whenever we lead people in any way to believe something that is not true, we are not being honest.". The complaint added that Roger Clarke, the president of Ensign, claimed that the investment branch collected the funds in preparation for "the second coming of Christ." Visit Insider's homepage for more stories. Asia Pacific +65 6212 1000. It said Huntsman would donate the money to groups he viewed as marginalized by the churchs teaching. According to its first 2020 report to the U.S. Securities and Exchange Commission, filed months after allegations by whistleblower David Nielsen and his twin brother, Lars, made headlines, Ensign Peaks value was reported at $37.8 billion in stocks and mutual funds. Ensign Peak Advisors ( email) 60 East South Temple 4th Floor Salt Lake City, UT 84111 United States. This page was processed by aws-apollo-l1 in. I feel terrible for the members who have been contributing their entire lives only to find out that not only did the church not need the money, but that they aren't even using it to help those in need. It accused church leaders of fraud over their handling of billions of dollars in members tithing. The new document alleges several new violations by EPA and its leaders. Along with the quarterly SEC filings, EPA appears to be more recognizable as an institutional investor in public companies now. Neither Clarke nor other officials would provide The Journal with details on the size of the churchs annual budget or how much money goes to Ensign Peak. For members of The Church of Jesus Christ of Latter-day Saints, tithing donating 10% of ones income to the faith is more of a sense of commitment than it is the church needing the money, Roger Clarke, head of Ensign Peak Advisors, which manages the denominations investing holdings, told The Wall Street Journal. The SEC alleges that from 1997 through 2019 Ensign Peak failed to file 13F forms, which are documents that certain investment managers must disclose quarterly, listing the securities that they manage. , UT Previous President for Ensign Peak Advisors Inc (801)240-3053. "This settlement relates to how the forms were filed previously. In criminal conduct, EPA has engaged in a Klein conspiracy to defraud the IRS by pretending to be tax-exempt while concealing and falsifying the facts of its massive securities investment business, the document states. The Mormon Church and its investment manager will pay a total of $5 million to settle charges with the US Securities and Exchange Commission over failing to properly disclose holdings in the church's massive investment portfolio. "Ensign Peak adjusted its approach and began filing a single aggregated report. But, the paper reported, they gave estimates for its main areas of expenditure that, collectively, total about $5 billion. The Journal reported that some of the money comes from donations from church members, a practice also known as tithing in which parishioners must give 10% of their annual income to remain in good standing. While some may look at that as a good thing, I actually think it's another instance where we can see that the church is not only untrue, but not good either. That should not surprise anyone considering the way they do accounting of these donations. EPA started filing a quarterly 13F form on Feb. 14, 2020, with the Securities and Exchange Commission, which regulates publicly traded companies and other financial firms. . They also did not respond to a request to comment this week for this update story. 6 (November/December 2016), Available at SSRN: If you need immediate assistance, call 877-SSRNHelp (877 777 6435) in the United States, or +1 212 448 2500 outside of the United States, 8:30AM to 6:00PM U.S. Eastern, Monday - Friday. The financial records destroy Huntsmans fraud claim, its lawyers argued in Aug. 31 court filings. 72, No. Ensign Peak Advisors, The Church of Jesus Christ of Latter-day Saints multibillion-dollar investment fund, has gone from operating nearly incognito 19 months ago to facing an uncomfortably hot spotlight. Donate to the newsroom now. Huntsman seeks to recover his tithing funds that were fraudulently obtained by the LDS Corporation, the lawsuit stated. Shortly afterward, Ensign Peak sold it all, judging from its absence in recent reports. . Those organizations will not only help people in need with the money, but they will be transparent about how they spend your money. . Steven Thorley He was a kid when the Swift raids split his family. It had a $1.5 million stake in sports apparel maker Lululemon in early spring of 2019, but managers had drawn that down to $2,000 by the start of 2021. 6 (November/December 2016), Posted: 10 Jun 2015 Upon learning of Mr. Nielsens IRS submission in December 2019, EPA abruptly began filing in its own name as required. Church officials have said the reserves are intended to help pay for operations in poorer parts of the world and to see the 16.6 million-member faith through any economic downturns. Huntsman countered that tithing funds and earnings from those member donations were commingled at Ensign Peak. Note: ReligionUnplugged.com will update this story with responses from relevant parties. The stake bounced up again to $102,000 in June. When you look at the details of the story along with the church's rationale for deceiving members, it quickly goes from dishonest to reprehensible. The Ensign Peak Advisors management team includes Anthony Kirkham (Vice President and Senior Portfolio Manager), Jason Butterfield (Chief Compliance Officer), and Roger Clarke (President). As of June, the funds shares in five Big Tech companies Apple, Microsoft, Google, Amazon and Facebook were worth nearly $9 billion, or 18% of its total value. Ensign Peak Advisors Inc., which oversees a $32 billion equities portfolio for the Church of Jesus Christ of Latter-day Saints, will pay $4 million to settle regulatory claims that the money. Circuit Court of Appeals. The LDS welfare fact sheet from 2009 shows in the years 1985 through 2009 (24 years), the church donated just $327.6 in cash donations but they also count $884.6 million in donations of "material assistance." Financial Analysts Journal, Vol. Back to the article: "The funds handlers are instructed not to invest in industries that Latter-day Saints consider objectionable including alcohol, caffeinated beverages, tobacco and gambling, he said, alluding in part to the churchs health code known as the Word of Wisdom, which bars those substances (although caffeinated sodas are not part of that prohibition). But if church leaders truly believed that, why not be transparent with the members who are taking their hard earned money and funding the church's investment portfolio? Ensign Peak and the Church have cooperated with the government over a period of time as we sought resolution." Keywords: factor investing, rules-based portfolios, quantitative portfolio management, Suggested Citation: Ensign Peak Advisors ( email) 60 East South Temple 4th Floor Salt Lake City, UT 84111 United States. The fund relies on a healthy share of so-called real estate investment trusts (REIT), which package landholdings into shares for sale. Ensign Peak, which manages $124 billion in investments cultivated from tithing funds, is admitting that the church doesn't tell its members about the fund because they know members aren't going to keep paying tithing if they knew the church is sitting on so much money that they could cover every administrative cost for the church with the yearly gains and still have billions left over in gains each year to grow the account. According to lead counsel for Mr. Nielsen, Michael A. Sullivan of Finch McCranie, LLP, the team representing Mr. Nielsen includes a former senior official of the SEC, more than one former federal criminal prosecutor, a former IRS Criminal Investigative Division agent, another former IRS official, and an international tax lawyer, all with decades of experience. At some point, saving needs to be converted into good works and charitable giving.. Either they don't have enough faith in you remaining 100% obedient to tell you the truth, or they are so greedy that they would rather lie to keep the money rolling in. Carolyn Homer, a Latter-day Saint who lives in Virginia, told The Journal that after she heard about the money held by Ensign Peak, she resolved to tithe less and give more to other charities. 1907, 7) 1. We believe at some point the Savior will return. The statement here by the church is a flat out lie, and as a member of record I beg any church leader to explain to me how this is not as damning towards their honesty as it appears to be. 1. And the concept of tithing in the Mormon church wasn't always like that and it was never supposed to be like that according to Prophet Joseph F Smith. Software Updates. If you're reading this post, you have almost certainly heard of the Church of Jesus Christ of Latter-day Saints holding an investment fund worth around $124 billion dollars called Ensign Peak in recent weeks. Cookie Settings. As we tend to do, we'll go through it in chunks to cover what the church is saying along with what they're not saying. Nielsen was also someone who had experience on Wall Street, working at a major New York hedge fund for five years and obtaining an MBA at UCLA before EPA recruited him in 2010 as an investment portfolio manager. Harindra De Silva. That was in keeping, they said, with then-church President Gordon B. Hinckleys declaration that the faith had a compelling responsibility to protect the environment of the Salt Lake Temple and that it was imperative to do something to revitalize this area.. 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