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.

That's right.

Let's get started. 

Welcome to the deep dive. Today we're tackling uh, a really interesting topic, one that brings up a lot of questions for people.

The modern finances of the Church of Jesus Christ of Latter-day Saints. You're probably here because you want to get the key info. Get it quickly, but also thoroughly. And that's exactly what we're aiming for. And we've got a bunch of sources, official Church stuff, SEC documents, whistleblower accounts, a real mix. And honestly, some of it is pretty surprising.

Yeah. Our goal here is to unpack the important certain bits from all this information to give you some clarity on what's a really complex topic without, you know, drowning you in jargon.

And it's not just theory. We're zeroing in on some key areas like Ensign Peak Advisors, that's the big investment arm, the SEC settlement that hit the news, allegations about how funds are used, and really what this all means for Church members and uh everyone else. Okay, let's get into it. Maybe start with a bit of history. How did we get here with Church finances?

Sure. It's evolved quite a bit. Way back 1840 41. It started as a trust with Joseph Smith basically in charge of the finances.

Okay.

But then a pretty big shift happened in 1916. They moved to a corporate structure. That probably gave them a more, let's say, formal way to handle money as the Church grew.

And even early on, they seemed to recognize the need for some oversight, right? Didn't they set up an audit committee way back?

They did. Yeah. 1877. And then a really crucial moment, financially speaking, was President Snow's revelation about tithing in 1899. That's often credited with saving the Church from, well, some serious debt issues.

Right. The emphasis on tithing that really laid the foundation for building up reserves later on.

Exactly. That combined with what sources describe as you know careful financial planning over the years and more recently they started sharing a bit more. Since 2013 they've put out annual reports on humanitarian spending.

Okay. So some level of reporting there. And then there was that big merger in 2019 bringing different financial parts together under one main operation name.

Yeah. The Church of Jesus Christ of Latter-day Saints Corporation. The First Presidency explained it then as being about using resources wisely for the Church's growing needs. Meeting houses, temples, education, aid, missionaries, all that.

Which brings us to Ensign Peak,

right?

Set up in 97, a nonprofit technically, but managing the bulk of the Church's investments. And this is where things get uh let's say more complicated, especially with the whistleblower David Nielsen.

Yeah, Nielsen's account is pretty significant. and he came from finance worked at Ensign Peak and he talked about the sheer scale of the money he estimated during his time it grew to somewhere between$150 billion

billion with a B that's just huge

it's a massive amount

yeah

and Nielsen’s main concern according to his account was that very little of this huge reserve seemed to be going out for charitable purposes while he was there

he mentioned exceptions right like bailouts

yeah he mentioned financial help for beneficial life which is Church affiliated and also covering extra costs for the City Creek Center Mall in Salt Lake City, but widespread charity. He claimed he didn't see much.

And this lack of charitable spending, given the size of the fund, was a big red flag for him.

It seems so. It led him to file a whistleblower complaint with the IRS and eventually he cooperated with the SEC investigation, too.

Yeah,

it really centers on that question. What's the purpose of that much money sitting in reserve for a religious nonprofit?

Okay, let's talk about City Creek specifically because you had top leaders like President Hinckley back in the 2000s and others later saying pretty clearly that tithing funds weren't used for that big shopping center development,

right? On the surface, those statements sound definitive, but if you trace the money flow, it gets a bit murky. Donations go into the main Church Corporation, the Corporation of the Presiding Bishopric. From there, funds flow to Ensign Peak for investment.

Okay?

And then funds went from Ensign Peak to Property Reserve Inc. or or PRI which was the actual developer of City Creek.

Ah so the Church's argument is yes tithing money went into Ensign Peak but the money used for City Creek came from the profits earned on those investments not the original tithing donations themselves.

Precisely that's the distinction they make.

But does that distinction you know really land with the average member paying their 10%. If they hear tithing wasn't used they probably think their donation didn't buy part of a mall.

And that's the counterargument is that distinction. meaningful or potentially misleading to a reasonable person donating in good faith. The argument is that the framing wasn't fully transparent, even if technically correct about the investment layer,

which connects to legal ideas like fraud. In Utah, for instance, fraud involves things like a false statement about something important, knowing it's false or being reckless, intending someone to rely on it. They do rely on it reasonably, and then they suffer damages. How does that apply here?

Well, the allegation is that “tithing wasn't used for City Creek” could potentially fit that definition of a false statement about an important fact. The source of funds for a major commercial project, especially given how members might reasonably interpret that statement.

Okay. This all kind of sets the stage for the SEC settlement in February 2023. Now, that wasn't about City Creek directly, was it?

No, not directly, but it definitely fueled the broader questions about financial transparency. The SEC focused on something else.

What did they find? They found that the Church in Ensign Peak had failed to properly file required forms disclosing their investments. Specifically, they found that over almost 20 years, they created 13 shell LLCs.

13 shell companies.

Yeah. To basically obscure the size of their securities portfolio, which had grown to about $32 billion. It should have been reported.

And didn't these companies have, like weird details? Phone numbers going to voicemail?

That's what the SEC order described. Local numbers straight to voicemail. Back office account. Signing forms for portfolios they didn't actually manage. It painted a picture of deliberate obfuscation.

What were the fines?

Ensign Peak was fined $4 million and the Church itself $1 million.

What was the Church's explanation for setting up these shell companies?

They stated that they had relied on legal counsel who advised this approach.

And the CEO of Ensign Peak, Roger Clark, reportedly gave a reason for wanting this secrecy, didn't he? Something about the members.

Yes. The concern reported was that if members knew the sheer magnitude of the wealth, it might have negative consequences, including potentially discouraging tithing donations.

Wow. Admitting the secrecy was partly to keep members from knowing how much money there was, potentially affecting donations. That feels significant.

It has major implications, especially for ongoing lawsuits that allege fraud or misleading members. The SEC finding that they actively hid the scale of their holdings certainly adds weight to arguments about a lack of transparency. So, how does all this land with everyday Church members? Learning about billions in reserves the SEC finds, you've got to imagine it affects how some people feel about paying tithing.

It certainly could. We've heard stories, anecdotes of members deciding to redirect their charitable giving to other causes after learning more about this.

Though the Church's perspective would be different, right?

Absolutely. From the Church's standpoint, tithing is a commandment, a principle tied to faith and blessings, both spiritual and temporal. Discouraging it would be seen as doing members a disservice.

But still, you can see the tension. Members making real sacrifices, maybe struggling financially, paying 10%, and then learning about these vast reserves that seem largely untouched.

It's a stark contrast. And you hear anecdotes like a member wishing for better sound systems in their local chapel while knowing billions are sitting in investments.

Yeah. And there are those accounts of leaders in, say, developing countries really pushing tithing even before people will cover their basic needs. Setting that alongside a $100 billion plus fund, it raises tough questions,

profound questions about priorities and resource allocation. Definitely.

So, let's try to put this wealth into perspective. What are the estimates now? Around $240 billion total assets late 2022.

That's one widely cited estimate. Yeah. With maybe two thirds of that, so over $150 billion in investments managed largely by Ensign Peak.

And how does Ensign Peak compare to other big investment funds.

It's up there with the giants. Comparable in size to huge university endowments like Harvard’s or Yale’s or even major investment firms like Berkshire Hathaway in some comparisons. It's a major player.

And the money keeps flowing in. Tithing estimates are around $8 billion a year.

That's an estimate. Yes. And after operating costs, the suggestion is maybe over a billion dollars gets added to the reserves each year. So it's not just large, it's growing.

Which brings us back to transparency. Legally in the US, Churches have exemptions, right? They don't have to disclose finances publicly like other nonprofits.

Correct. Legally, there's no obligation for full public disclosure.

But ethically, when people donate based on faith and trust,

that's where it gets complex. There's an implied contract, you could say.

Yeah.

Members trust the funds are being managed wisely and used for the Church's stated mission. There are internal audits reported at the local level, but they don't give that big picture view.

So, where does the money go? We know the Church talks about humanitarian aid. Over a billion reported recently. Yes. Humanitarian aid, education subsidies like for BYU, building and maintaining temples and meeting houses, supporting the missionary program. Those are the main areas highlighted.

Is the spending proportionate to the reserves though? That's the debate, isn't it?

It is. Some argue given the scale of the wealth that philanthropic giving could be vastly increased. There is the anecdote about President Packer questioning the cost of an MTC expansion, asking how many temples could be built for that price, showing that internal discussion about allocation happens

and distributing huge amounts of aid effectively isn't simple either, right? Professional philanthropy has costs.

True, doing it well requires infrastructure and expertise. But the argument remains, could the Church significantly ramp up its charitable impact?

Then there are ideas like the Widow’s Mite Report suggesting members give elsewhere and the Church uses its reserves to run things.

That proposal really crystallizes the debate. What's the best use of these funds? Even the cost of building and maintaining all the temples, while substantial, is argued by some to be manageable well within the existing reserves without needing constant growth.

And what about the idea that they're saving for the second coming? Is that a serious justification?

It's mentioned sometimes perhaps a bit tongue-in-cheek, but for some it reflects a genuine belief about preparing for future perhaps catastrophic events. How practical or central that is to the actual financial strategy is harder to say.

Let's touch on the secrecy aspect again. Reports suggest very few people, maybe just the First Presidency and Presiding Bishopric know the full details of Ensign Peak's holdings.

That seems to be the case. There's that story about Elder Packer when he was President of the Twelve Apostles apparently being denied full access to the Ensign Peak information he requested.

If even the President of the Twelve can't get the full picture, why such tight control?

Well, the reasons reportedly given by Ensign Peak leadership circle back to what we discussed, fear that donations would drop if members knew the full amount,

right?

Also preventing others from copying their investment strategies and avoiding public scrutiny or criticism of their financial choices.

Do those reasons really justify that level of secrecy in a religious organization built on trust?

Many would argue no. That transparency actually builds trust even if the numbers are large and that making decisions based on fear, fear of member reaction, fear of criticism isn't ideal.

So wrapping this section up, we have this picture of an institution with true enormous wealth. It creates incredible opportunities, but also real challenges and questions.

Exactly. The potential for good is immense. But the questions about how that wealth is used, how transparent the process is, and how it aligns with the sacrifices of members, those questions remain very relevant.

Okay. So, bringing this all together, this deep dive really shows that the financial side of the Church is, well, way bigger and more complex than maybe most of us assume.

Definitely. And the information we've gone through pulled from those sources, the statements, the SEC findings, the whistleblower accounts, it paints a much more detailed, nuanced picture.

We really hope that laying this out helps you, the listener, reflect on it all and maybe see the Church's role and impact financially speaking in a new light.

Yeah. Take some time to mull it over. Think about what it means for your own understanding.

And maybe a final thought to leave you with after hearing all this. What's the one question about Church finances that sticks out most to you? What feels most important to ask going forward? There are different paths you could explore further, too. Depending on what grabbed your interest, you could follow news on the ongoing lawsuits, look into that Widow’s Mite project we mentioned, or even research ethical guidelines for how large nonprofits should handle their finances.

It's always good to stay informed, right? And understanding these things is definitely an ongoing process. Thanks so much for joining us for this deep dive.

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