Welcome to Study Faith with AI, where we use the power of AI to help you explore the Church of Jesus Christ of Latter-day Saints.

I'm Meg Jensen.

And I'm Paul Carter,

and we're Google AIs. Whether you're a lifelong member or just starting to learn about the Church, we're here to dive deep into its history, beliefs, and culture.

So, if you're ready to learn, you're in the right place.

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It's a really striking contrast, isn't it? You look at Utah, known for this incredibly strong community spirit.

Yeah, very tight-knit.

And then you see these, well, surprisingly high rates of financial fraud. It seems counterintuitive.

It really does. And when you dig in a bit, you find members of the Church of Jesus Christ of Latter-day Saints are often disproportionately affected.

Okay, so let's try and unpack that connection today. We're doing a deep dive into this, uh, fascinating maybe slightly unsettling intersection of Mormon culture and finance.

We'll be looking at a few key things. There's this idea of a soft prosperity gospel, maybe how that plays out.

Right? And the big emphasis on self-reliance. That's huge.

Definitely. And then unfortunately, the reality of financial scams, specifically affinity fraud, targeting people within the community.

Yeah, affinity fraud. We'll get into what that means.

And what's really compelling, I think, is seeing how these threads, the theology, the cultural values, and then these real world vulnerabilities, how they all kind of weave together.

So, our goal here for you listening is to help understand those connections to maybe shed some light on why a community built on trust might actually be, well, susceptible.

Exactly. Hopefully give you a more nuanced picture of a really complex issue. We've looked at, um, quite a range of sources for this.

Like what?

Well, articles talking about the doctrines, warnings straight from Church leaders over the years, and then uh some pretty sobering firsthand accounts. and analyses of actual fraud cases.

Okay. So, let's start with the theology then. This idea of a soft prosperity gospel in the Church. It's not the, you know, the super overt send me money and get rich kind of thing.

No, generally not. It's usually more subtle. A key part is how certain scriptures get interpreted, especially from the Book of Mormon.

Like which ones?

Well, a classic example is 1 Nephi 2:20. It promises that if you keep the commandments, you'll prosper in the land.

Right? Prosper. But what does that actually mean in context?

That's the crucial question. Our sources raise the Latin root prosper means something like to cause to succeed or make happy.

So not just money.

Not just money. Even back in Joseph Smith's time, prosper meant things like growing, increasing, thriving. It was a much broader sense of well-being, including spiritual health, guidance, protection.

Okay, that makes sense. It's not purely financial, but then you have tithing.

Ah, yes, tithing.

That feels a bit more direct, doesn't it? With the promise in Malachi 3 about opening the windows of heaven that also gets linked to blessings including temporal ones.

It does and that's where you see some divergence in interpretation. Some people definitely see that connection paying and tithing leads to blessings maybe including financial ones as sort of aligning with prosperity gospel ideas.

Like a cause and effect.

Yeah. Or as one perspective in our sources puts it, it can sometimes feel a bit transactional almost like paying for blessings.

But Church leaders themselves seem to push back against that purely transactional view, right? They don't explicitly promise you'll get rich if you pay tithing.

Correct. Our sources highlight statements from leaders like Elder Ballard or former BYU dean Ned Hill. They tend to emphasize that righteousness leads to stronger values, stronger families,

which might result in temporal success sometimes.

Often, yes, as a byproduct, maybe, but not as a guaranteed quid pro quo. President Nelson, for instance, talks about obedience leading to a joyful life, eternal rewards, not necessarily a specific bank balance. It's more holistic.

That footnote in President Nelson's conference talk from October 2023 was interesting. The one clarifying about tithing and professional opportunities.

Yes. It really felt like an acknowledgement that there's potential for misinterpretation there.

Like they wanted to make sure people didn't see it as pay tithing, get a promotion.

Precisely. It reinforces the idea that God isn't, as one source put it, like a vending machine. You don't just put in obedience and automatically get out a specific material blessing. It's about a relationship, faith, covenant.

Okay. So, a more complex view of prosperity than sometimes assumed. Let's shift gears then to another really core idea, self-reliance.

Yes. Absolutely central in Mormon culture seen as vital for spiritual and temporal growth.

There was that quote from Elder L. Tom Perry about freedom being threatened if we depend on anything but the Lord.

Right? That really captures the spiritual side. But it's important, as our sources note, to distinguish spiritual self-reliance, depending on Christ, from temporal self-reliance,

which is more about managing earthly things wisely.

Exactly. Managing resources, finances, skills, but they're linked.

So, it's not about just pulling yourself up by your bootstraps and ignoring everyone else.

No, not really. The principle of stewardship is really important here from the Doctrine and Covenants. The idea is that resources ultimately come from God

and we're accountable for how we use them.

Yes, we're stewards, not ultimate owners. So, we should be diligent, wise, avoid greed, manage things responsibly.

And the Church even has programs focused on this, doesn't it? The self-reliance initiative.

Yes, exactly. Programs aimed at helping people with education, jobs, starting businesses, managing finances,

but grounded in faith.

Crucially, yes. The program materials emphasize that temporal self-reliance is built on a foundation of spiritual reliance on God. It's not just about individual effort and isolation.

I have heard the term self-reliance itself criticized sometimes though, like it might discourage asking for or offering help.

That's a fair point raised in the sources. The term can be misunderstood as promoting total autonomy, maybe downplaying community support.

Is there an alternative?

Some suggest provident living might capture it better, emphasizing careful planning and resource management within a supportive community.

And you have to remember the history too, right? The pioneers, the Church welfare system, there's always been a communal aspect.

Absolutely. A balance between individual responsibility and collective support. Maybe the emphasis shifts subtly over time, but both are usually there. Recent efforts focus more on building people up, not just giving aid.

Okay, so we have this nuanced view of prosperity, this strong emphasis on stewardship and self-reliance,

which brings us to the difficult part, financial fraud,

especially affinity fraud.

Yeah. This is where things get really troubling. Affinity fraud basically is when scammers exploit trust within a specific group,

a group they belong to or pretend to belong to.

Exactly. Religious groups, ethnic communities, professional organizations, anywhere, there's a built-in level of trust and shared identity. The scammer's angle is fundamentally, "Hey, I'm one of you. You can trust me."

And that's particularly damaging in a religious setting like the Church.

Immensely damaging because trust is often higher. There's a shared moral framework. It lowers people's guards.

And these scams often take the form of Ponzi schemes or pyramid schemes. Can you quickly explain those?

Sure. A Ponzi scheme named after Charles Ponzi doesn't rely on any real business profit. It just pays returns to early investors using the money coming in from newer investors.

So, it looks legitimate at first,

right? It creates this illusion of high steady returns, but there's no underlying engine generating wealth. It's just shuffling money around until it inevitably collapses when new money dries up.

And pyramid schemes.

Pyramid schemes are more focused on recruitment. You make money primarily by recruiting other people into the scheme who then recruit others. and so on. Again, unsustainable. Those at the bottom always lose out when recruitment stalls.

And sadly, as we mentioned, Utah seems to be a real hot spot for this kind of thing, particularly within the Mormon community. Our sources had some really disturbing examples.

They really did. The Mormon Stories podcast interview with Mark Pugsley, an attorney who deals with this stuff, and The Mormonism Research Ministry article, they paint a grim picture.

What are some of the common tactics fraudsters use?

Well, leveraging Church connections is key. They might casually drop names of bishops or even general authorities they supposedly know

using their own Church calling maybe.

Absolutely. Using a calling like being in a bishopric or Stake presidency to build instant credibility. They emphasize the Church connection over the actual financial details of the investment.

Wow. I heard somebody even start pitches with prayer. Yeah.

Or get emotional.

Yes. Using prayer, shedding tears. It's all about manipulating emotions and trust. They promise unusually high, often guaranteed returns. That's a huge red flag.

And pressure you to act fast. Avoid paperwork.

Definitely creating urgency, avoiding things like official prospectuses or private placement memorandums, relying on handshakes and trust instead of documentation.

The specific cases are just mind-boggling. The guy with 19 luxury cars.

Yeah. While supposedly running a business that served the community, even catering youth activities. Just brazen.

Or the fake CD in New Zealand promising 30% a month. How I didn't believe that.

It sounds unbelievable, but desperation, trust, maybe a bit of greed, people get taken in. And the scammer, Jeff Mohan, already had a criminal record.

Then there was the guy who lied about his son being on a mission while taking millions.

Just awful. Using something so sacred as cover. And Clint Nordle targeting people he home taught or met on an LDS dating site.

Exploiting the most vulnerable points of connection.

Exactly. Jacob Keith Cooper bragging about his mission and Eagle Scout award. Andrew Dean Kelly faking trading software while playing the faithful member.

The Jacobson case, allegedly using Church membership directly to lure investors.

It's a recurring theme. And Curtis Young stealing retirement funds. The judge in that case explicitly called it an epidemic in the community.

An inexhaustible supply of gullible victims and predators. That's a harsh assessment.

It is, but it reflects the frustration. Even recent widows aren't safe, like in the Steven Hines case. It shows how deep this problem runs.

So, what are the absolute key warning signs? you should look for if someone approaches you, especially within your ward or stake.

Okay. Number one, promises of high returns with little or no risk. That's almost always a scam. Real investments have risk.

Makes sense. What else?

High pressure to invest immediately. Get in now before it's too late. That's a manipulation tactic.

Lack of paperwork.

Huge red flag. Legitimate investments have prospectuses. Offering memorandums, detailed financial disclosures. If they wave that away, be very suspicious.

What about the person selling it? Check if they're licensed. You can look them up on the SEC's website or FINRA's broker check. Unlicensed sellers are a bad sign.

And overly complex strategies, offshore stuff.

Yes. Things that sound too complicated to understand, especially involving offshore accounts or secret trading methods, often designed to confuse and impress, not clarify.

And ultimately, if it relies more on trust me, we go to Church together than on solid financial proof.

That's the core of a fraud. Trust is great, but it shouldn't replace due diligence when it comes to your money. Also, watch out for songbirds.

Songbirds.

Yeah, that's a term for trusted people within the group, maybe even a well-meaning bishop, who get roped into promoting the scam, sometimes without fully realizing it's a fraud themselves. They lend their credibility.

Man, that's insidious. So, why does this seem to happen so much within this specific community? What makes Mormons potentially more susceptible?

Well, as we've said, the strong community ties and the culture of trust are a big factor. It's a strength, but it can be exploited.

People let their guard down with fellow members

often. Yes. There's an assumption of shared values and honesty. Then there's the lay clergy system.

How does that play into it?

Your bishop is typically someone you know from the community, maybe a neighbor or colleague, not necessarily a financial expert, but the position carries immense trust and respect. A scammer who is a bishop or just gets the endorsement of one gains instant credibility that might be undeserved financially.

And what about the history? Does the early Mormon experience play a role?

Some sources suggest it might. That history of persecution being driven out, financial losses,

it could foster a kind of circle the wagons mentality,

making people more reliant on trusting those inside the group and maybe more suspicious of outsiders.

Potentially, yes. It could lower the critical scrutiny applied to fellow members compared to someone from outside the community.

And is there anything about the culture's view on success? That's another factor discussed. There can be in some circles a strong emphasis on achieving financial success and respectability,

which might make people more eager for quick gains,

perhaps more susceptible to pitches promising high returns, and maybe also more reluctant to admit they've been scammed out of embarrassment or fear of losing face in the community.

One source also mentioned something about missionary work normalizing high pressure sales tactics. That seems like a stretch.

It's a more speculative point, but the idea is that the culture values persuasive communication, which in a different context could overlap with high pressure sales techniques used by fraudsters. It's a subtle potential influence.

Okay, so putting this all together, this isn't just bad for the individuals who lose money. It sounds like it's a significant issue for the Church itself.

Oh, absolutely. The impact can be devastating. When members lose their life savings to someone they trusted from Church, it can cause profound disillusionment,

questioning their faith, their community.

Yes. Frustration, anger, a sense of betrayal. Sadly, our sources indicate it does lead some people to leave the Church altogether. The broken trust cuts deep.

And does the perceived emphasis on financial success sometimes contribute?

There's a perception mentioned in some analyses that the culture can sometimes seem to value worldly success quite highly. If that's the case, it might create incentives for people to chase risky schemes or even perpetrate fraud to achieve that status.

And how effectively can the Church police this? You mention the lay leadership.

It's inherently difficult. The Church structure is decentralized locally. Leaders are volunteers. They issue warnings. Absolutely. But actively policing complex financial dealings among members is very challenging.

Local leaders might hesitate to confront someone they know well.

It's possible. Plus, these high-profile fraud cases involving members inevitably generate negative publicity and can harm the Church's overall reputation.

Though, it's fair to say Church leaders have warned about this stuff repeatedly. over many years. Right.

Definitely. Our sources include many quotes from Joseph B. Wirthlin, M. Russell Ballard, Dallin H. Oaks, Marvin Ashton, James Faust, even going back to Brigham Young and N. Eldon Tanner. Warnings against get-rich-quick schemes, speculation, dishonesty, and specifically affinity fraud.

So, the awareness is there at the top.

The awareness and the warnings are definitely there, but the problem persists, which highlights how deeply ingrained some of these vulnerabilities might be and the constant need for individual vigilance.

Okay. Wow. We've covered a lot of ground here. As we sort of wrap up this deep dive, what are the main things you think people should take away?

Right. I think first understand that prosperity in a Mormon context is complex. It's meant to be broader than just money encompassing spiritual well-being, too.

Okay.

Second, second, self-reliance is vital, but it's rooted in stewardship being accountable to God, not just rugged individualism. It should coexist with community support. Got it. And the fraud.

Third, affinity fraud is a serious ongoing problem within the community. Sadly, exploiting that very sense of trust and shared identity.

And fourth, there are reasons for that vulnerability. The trust, the leadership structure, maybe history, and cultural emphasis.

Exactly. And finally, this isn't just about money. It impacts faith, trust, and the Church's reputation despite leaders consistently warning against it.

It really leaves you with some heavy questions, doesn't it? Like, how do you balance that essential community trust with the critical thinking needed to avoid getting scammed.

That's the core dilemma, isn't it? How do you maintain the good parts of that closeness while protecting yourself and the community's integrity? And

maybe how can that strong sense of community itself be turned into a tool against fraud, leveraging those bonds for education and mutual protection, perhaps?

Those are definitely the kinds of questions worth thinking more about, things individuals and communities need to grapple with.

Yeah. Well, this deep dive gives you a lot of context, hopefully. We hope so. And we definitely encourage you if this is something that interests you or affects you to maybe look into some of the sources we drew on, think about it, maybe even discuss these dynamics carefully within your own circles. Fostering awareness is probably the best defense.

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