whistleblower on Church finances

[Calm]

2 hours ago, california boy said:

It is only harmful if he made the whole thing up. 

Do you disagree that truth can be presented in ways that are either fair or harmful?  Or unrealistically positive for that matter?

That how truth is presented can create mistrust where no mistrust should exist?

For example, over the period of a week someone sees a neighbour’s wife with another man at lunchtime. They are sitting very close together and talking quietly, sometimes laughing, lots of smilies, apparently oblivious to the world.  The observer tells the husband about the meeting the first time it happens as well of the other times. She has not told her husband about the meetings nor does she when he asks if she is doing anything interesting that day.

Do you think there could be ways that such truth could be presented as harmful with the intent to create mistrust and other ways that would not, rather it was presented as an everyday social encounter?

Once mistrust is created, in some people the wife confirming she was with another man would only strengthen the mistrust as one aspect of the accusation being proved is what is focused on, not whether or not that aspect is wrong in itself. 

Edited December 20, 2019 by Calm

[rockpond]

44 minutes ago, pogi said:

Part from tithes, part from other investments and for-profit businesses. 

And how did the Church get the other investments and businesses that are producing this income?

[rockpond]

58 minutes ago, gopher said:

As long as the church isn't refusing to help out its members, I don't feel a need to decide what's the appropriate amount for the church to invest.

So as long as it is doing something/anything to help out its members, there is no limit to how much wealth the Church can accumulate?

Have you heard of the Liahona Children's Foundation (now Bountiful Children's Foundation since the Church asked it to change its name)?  It is an organization that was formed specifically to provide nutritional supplements to underweight and malnourished LDS children. LDS children.

And this was done while our Church was allegedly amassing a $100 billion investment portfolio.

How do you just your standard that the Church isn't refusing to help out its members?

[rockpond]

18 hours ago, The Nehor said:

I read the 74 page pdf. The IRS is not the intended audience. It is filled with irrelevant footnotes hamfistedly shoved in covering plays from the anti playbook like worthiness interviews. There is a mention of the mall that cost “X” (someone forgot to proofread and fill that in later). There is a quoted anecdote about President Packer showing up wanting to know what was going on since he was next in line and he was turned away since only the First Presidency was allowed to know about what was going on. How did a mid-level guy like the whistleblower know what was said to President Packer and how did he get an exact quote? The whole thing is riddled with appeal to emotion and ridicule. Out of context quotes from church leaders show up regularly and there are a lot of cutesy in-jokes from Church culture and hymns and the like. For example, it is suggested that “angels are silent notes taking” about supposed financial practices. I was amused by the call for congressional investigations with not so subtle hints about who should be called to testify. Then there is the references to mega churches and their excesses and the Church is referred to as a gigachurch. At one point the document says it is the only gigachurch (sorry to Catholics and Baptist’s and all the other wannabes who did not make the cut). Later it calls for legislation specifically to target gigachurches where they seem to have forgotten there is only one.

It is also riddled with grammatical errors. I did like one portion where three major changes to tithing practices are listed. The first one is in the early church, the second in the 1970s, and the last is right after World War 2 and the verbiage conveys that they are being presented sequentially. After all who can forget when President Ronald Reagan, Prime Minister Margaret Thatcher, and President Mikhail Gorbachev teamed up to form the Allied powers against the threat of the Axis?

Stripped of irrelevancies it should have been five to ten pages at most. Of course that would not serve because that would not fill the real role of using it as propaganda. Either that or the writer is an idiot and actually thought the IRS cares about worthiness interviews and LDS Second Coming eschatology and how it can be mocked as the equivalent of the return of Lord Xenu (despite there being no such doctrine even in Scientology).

Well -- Nielsen did say that his "Letter to an IRS Director" was an homage to Runnels' "Letter to a CES Director".   Just as I haven't read the CES Letter, I don't plan to read Neilsen's doc either.  But, it sounds like Nielsen may have mimicked more than just Runnels' title.

[mrmarklin]

On ‎12‎/‎16‎/‎2019 at 8:41 PM, blueglass said:

Hmm, I work as a stake auditor.  Have you ever had to audit a local units "other" account?  This "other" account is gianormous.

I used to be a stake auditor.  You realize that all donations of any kind in the US are swept into Church accounts in Salt Lake City, right?  And that there is only a nominal amount of $$ are local mainly to keep a bank account open for deposits.

There are no "giganormous" amounts of Money held locally at all.  Just numbers on pieces of paper....oh wait....that's online now as well.

[mrmarklin]

From the IRS website::

 

"Generally, tax-exempt organizations must file an annual information return (Form 990 (PDF) or Form 990-EZ (PDF)). Most small tax-exempt organizations whose annual gross receipts are normally $50,000 or less can satisfy their annual reporting requirement by electronically submitting Form 990-N if they choose not to file Form 990 or Form 990-EZ. Churches, some church-affiliated organizations and certain other types of organizations are excepted from filing."  My bold.

This thread has certainly shown a lot of ignorance about how churches are treated in the US.  In general, churches have no filing requirements at all regarding their tithed funds.  The only thing that must be kept track of is "unrelated business income".  See form 990 above.

The Church has no obligation to disburse any of its funds for charitable purposes at all.  It there are Church sponsored charities, that would be different.  But it seems like Ensign is just a holding entity for tithing.  Assuming that is the case, it would only report to the IRS its unrelated business income and nothing more.

[Calm]

On 12/19/2019 at 1:23 PM, The Nehor said:

Many would assume they would be better off but if the United Order equalizes worldwide...........very few in my local area would be uplifted through redistribution.

The ultimate financial benefit for Americans and Canadians, whose standard of living compared to other places where there are increasing numbers of Saints, would likely be stability, security.

[Calm]

It would be nice to get a stripped down version of the 74 page commentary that includes only the actual documents he got from Ensign Peak Advisors....from what I could tell maybe 20 or 30 at most, many flow charts for a power point slide show as opposed to actual financial documents?

[Teancum]

On 12/17/2019 at 3:54 PM, smac97 said:

Per the Church's statement: “Claims being currently circulated are based on a narrow perspective and limited information. The church complies with all applicable law governing our donations, investments, taxes and reserves. We continue to welcome the opportunity to work with officials to address questions they may have.”

This doesn't sound like spin, or deflection, or evasion.  It sounds like the Church is pretty comfortable that it has complied with the law.

Actually no, I don't see it.  What a disgruntled former member of the Church things the Church "should" do with its funds is not a "legal argument."

A disgruntled former member of the Church asking the IRS to punish the Church by revoking its tax exemption is not a "legal argument."

Thanks,

-Smac

I think you are correct and the statement does seem to be confident. As has been mentioned, there is no question that the church likely has tax advisers of the highest caliber consulting with them on Ensign Peak. I cannot imagine that they would have done something to the level of accumulating $100 Billion or even $30 Billion of assets in a fund without being fairly confident they were not running afoul of the law. I work with tax law but I am not an expert on NFP rules having intentionally avoided that area of tax law because it does not interest me. But from a high level I do not know of any limit that an NFP has on accumulating assets in a reserve fund. Now using those assets for something other than the NFPs stated purpose would be problematic. It seems the $$ going to Beneficial Life and City Creek Mall could be a problem but I am not certain of that.

The real problem is public perception both in and out of the Church.

[Teancum]

3 hours ago, rodheadlee said:

But if they had lost that money in failed Investments everyone would think they are definitely not prophets seers and revelators.

Perosnally I would not. I see no reason to think if there is such a thing as prophets. seers and revelators (I don't by the way) that God would give them any special investment savvy either way.

[pogi]

1 hour ago, rockpond said:

And how did the Church get the other investments and businesses that are producing this income?

Modest seed money from tithing may have been used initially to start church businesses such as in agriculture or the Tabernacle Choir.  The Church has owned businesses almost from the very beginning. This seed money has been paid back in full and the Church no longer depends on tithing money for further investments.  City creek could have easily been paid for without using a dime of tithing money, which has all been paid back.    

[pogi]

3 hours ago, rodheadlee said:

But if they had lost that money in failed Investments everyone would think they are definitely not prophets seers and revelators.

Many early saints and church leaders were disillusioned with the early financial problems and failure of the Kirkland Safety Society.  So, you aren't wrong.   But, this just shows that financial failure or success is the sign of a profit but not a prophet.  It is only within the last few decades that the Church has found any financial success.  The Church has been in debt for a long time. 

[rockpond]

5 minutes ago, pogi said:

Modest seed money from tithing may have been used initially to start church businesses such as in agriculture or the Tabernacle Choir.

If the Church used tithes to start businesses than profit coming from those businesses is still sacred funds.

5 minutes ago, pogi said:

This seed money has been paid back in full

This is supposition but let's assume you are correct.  Is it appropriate for church leaders to use tithes and offerings to start for-profit ventures as long as they pay the money back?  Is that the point of tithes and offerings to serve as free capital for the Church's business entities?

5 minutes ago, pogi said:

...and the Church no longer depends on tithing money for further investments.

And your evidence for this is what?

5 minutes ago, pogi said:

City creek could have easily been paid for without using a dime of tithing money,

Where does this non-tithing money come from?  The investments that were made with tithed "seed money"?

5 minutes ago, pogi said:

which has all been paid back. 

How do you know this?  Please share.

[Scott Lloyd]

2 hours ago, pogi said:

Modest seed money from tithing may have been used initially to start church businesses such as in agriculture or the Tabernacle Choir.  The Church has owned businesses almost from the very beginning. This seed money has been paid back in full and the Church no longer depends on tithing money for further investments.  City creek could have easily been paid for without using a dime of tithing money, which has all been paid back.    

A good point and a good post. So good that I hesitate to quibble, but the Tabernacle Choir is not a good example for your point. 
 

The Tabernacle Choir originated under Brigham Young’s presidency as a group of Welsh converts who had arrived in the Salt Lake Valley and organized themselves into a volunteer choir, not unlike our ward choirs of today.  It grew from there. 
 

The Tabernacle Choir has never been a profit-making entity. It exists on philanthropic donations. Even its commercial recordings, paid concerts and network broadcasts do not come anywhere close to meeting expenses. I doubt tithing funds have ever been used to support the choir, which has always been regarded primarily as a missionary tool for the Church. 

Edited December 20, 2019 by Scott Lloyd

[Scott Lloyd]

5 minutes ago, rockpond said:

If the Church used tithes to start businesses than profit coming from those businesses is still sacred funds.

This is supposition but let's assume you are correct.  Is it appropriate for church leaders to use tithes and offerings to start for-profit ventures as long as they pay the money back?  Is that the point of tithes and offerings to serve as free capital for the Church's business entities?

And your evidence for this is what?

Where does this non-tithing money come from?  The investments that were made with tithed "seed money"?

How do you know this?  Please share.

And you don’t think your notion that Church businesses were begun with tithing is supposition?

[rockpond]

3 minutes ago, Scott Lloyd said:

And you don’t think your notion that Church businesses were begun with tithing is supposition?

I said "if"... I was working from Pogi's assertions - as I stated.  (Assertions in a post that you just referred to as "a good point and a good post".)

[Amulek]

51 minutes ago, Teancum said:

It seems the $$ going to Beneficial Life and City Creek Mall could be a problem but I am not certain of that.

Do you honestly think that their audit / controls are so lax that they really disbursed roughly $2 billion dollars illegally? 

The very notion strains credulity.

Keep in mind that we're supposed to believe the church is just hoarding all of this money - never using it for anything holy, and never doing anything with these funds but re-investing their profits year-after-year in order to fill up the church's money bin, a' la Scrooge McDuck.

Except, of course, for the fact that we're just so evil that we can't help ourselves from spending some of that money.

And (again, since we're evil - I mean really evil, like forcing people to watch Moulin Rouge! over and over again evil) the only times we have bothered to do so in the last 22 years just happen to always be for illegal purposes?

Seriously?!? 

No wonder all of the antis are eating this stuff up. It feeds right into their narrative - the story they want to believe - the one where the church is wearing the black hat, and the enlightened ex-mos are the ones shining a light on the darkness. 

Puhleese. 

 

[Avatar4321]

On 12/17/2019 at 2:10 PM, 2BizE said:

Not all members live close to a bishops storehouse.  Food is not always readily available.

Then it gets brought to you

[Calm]

5 hours ago, rockpond said:

Is that the point of tithes and offerings to serve as free capital for the Church's business entities

I would say yes to tithing use for for profit businesses (under certain conditions for a minimal time as I will explain), but not offerings.  I see tithing as for building up of the Kingdom, which requires a state of stability and offerings meant for the welfare of God's children.  Tithing is fulfilling a law, offerings are an expression of love and gratitude.

I look on it as a practical matter...at first, but only in small ways and if relatively safe (not high risk, but would have a low risk, slow profit buildup) and primarily if possible beneficial to local members as the tithing payers I would see it as proper if not particularly desirable (due to the hard feelings it might cause because of possible uneven benefits to members) if the use of tithing for profit was done during a time the Church was barely coming out of debt and trying to approach building the Kingdom in a wiser, more prudent fashion.

 The need to build a safety net would be essential and if tithing was barely meeting needs at that time, using another way than saving small amounts of tithing to raise capital faster would be wise imo as even a slightly bad year might wipe out any savings or increase so as to move them back to square one while if a good year here and there were taken advantage of with pushing a bit better return rate and establishing an income route outside of tithing, then a few of those and several okay years could generally handle slightly bad years and eventually disasters.  Especially feel positive about that route if such businesses had purposes that could contribute to the missions of the Church (news, publishing, transportation, farms, schools, manufacturing of some necessities) or were part of the sense of self sufficient community the Church culture had in the past (hospitals, insurance, banks, stores).  

Once the Church had a consistent ability to foresee and meet its needs through tithing and then enough excess to deal with any yearly variation because of exchange rates or inflation or the more frequent minor conflicts between countries (that might result in needing to get missionaries all out quickly for example) each year globally, then shifting to tithing only for nonprofit specific to the missions of the Church makes practical sense to me.

Edited December 21, 2019 by Calm

[Hamba Tuhan]

5 minutes ago, Avatar4321 said:

Then it gets brought to you

This is absolutely correct. I live in a nation without a single Bishop's Storehouse. The Church's welfare system still works just fine. In our case, the food literally is taken to the members. The Relief Society president obtains a list of what is needed from the family or individual and then just places an order with one of the supermarkets that does home delivery. If the need is help paying utility bills, for example, we just pay those online. When I was last serving in the bishopric, we had a dual-income family where the wife lost her job. Suddenly, they couldn't afford to pay their home loan, so we figured out how much they needed and just paid that portion for them until they got back on their feet.

I have lived in both developed and developing nations. I have never not seen Church welfare work the way it's intended.

[pogi]

42 minutes ago, rockpond said:

If the Church used tithes to start businesses than profit coming from those businesses is still sacred funds.

I wouldn't necessarily disagree, I think the Church views it that way too, but it is not the same as tithing money.

Quote

All church funds exist for no other reason than to support the church’s divinely appointed mission.

https://www.deseret.com/utah/2019/12/17/21026182/mormon-lds-church-washington-post-whistleblower-irs-complaint-taxes-ensign-peak

 

44 minutes ago, rockpond said:

This is supposition but let's assume you are correct.  Is it appropriate for church leaders to use tithes and offerings to start for-profit ventures as long as they pay the money back?  Is that the point of tithes and offerings to serve as free capital for the Church's business entities?

Quote

Tithing donations are always used for the Lord’s purposes, which He reveals through a council of His servants.

https://www.churchofjesuschrist.org/study/manual/tithing-and-fast-offerings/how-are-tithing-funds-used?lang=eng

1 hour ago, rockpond said:

Where does this non-tithing money come from?  The investments that were made with tithed "seed money"?

Initially maybe, but if it has been paid back, then it is no longer tithing money that funds it.  If you borrow money from a bank and pay back the loan, is all interest made on the loan considered bank money or loan money?  Nope. 

1 hour ago, rockpond said:

And your evidence for this is what?

How do you know this?  Please share.

It is a reasonable assumption.  Look how many companies the Church owns.  It is unreasonable to assume that they are not making huge profits to easily cover any seed money. 

[Hamba Tuhan]

6 hours ago, california boy said:

So basically it is based on fear. Ok thanks

I have been impressed in the past with your ability to completely misconstrue what someone else has written and replace it with something you find easier to attack or dismiss, but I think you've just reached new capacity!

[Scott Lloyd]

2 hours ago, rockpond said:

I said "if"... I was working from Pogi's assertions - as I stated.  (Assertions in a post that you just referred to as "a good point and a good post".)

OK, then. 
 

But it seems to be a standard talking point, not just with you but with other critics as well. 

[smac97]

Peter J. Reilly has posted some additional thoughts and links.  It's an interesting read: More On The Mormon Ensigngate

The gist, I think, is that he thinks this is less a "legal" issue, and more of a "policy" issue ("Why are churches treated differently when it comes to disclosure?" and "And what needs to be done about tax-exempts accumulating vast pools of capital that is never put to charitable use?").  

He also says this: "Most financial scandals involving churches involve the people running them looting them, not the church saving up too much money. There is nothing in these allegations that indicates that LDS leadership is enriching itself."

This is a point that bears some attention.  The Church is being characterized as a villain.  For saving money.

He also has some good things to say about th Nielsens, but also notes the problem with their attempt to "weaponize" the IRS against the Church:

Quote

I admire the Nielsens. My difference with them is in the expectation that there is a role for the IRS here given the current state of the law. I refer to this as the “Al Capone” syndrome — the notion that the IRS is there to right wrongs rather than collect taxes.

I have brought this up a number of times in my coverage of Scientology. Really, the IRS does not have the resources to regulate the not-for-profit sector and it is not very good at it when it tries.

I think that's right.

A few more useful insights (from Mr. Reilly and other experts he has consulted and quotes):

• "Now, Ensign will almost surely argue that it is an integral part of the church. Furthermore the church pays out lots of money every year from its tithing.  If we view total expense in comparison to endowment if there were some payout requirement it would be met.  That may be so and because of that the IRS would almost surely never challenge this situation."
• "I thought when I reviewed the WB {EDIT: Is "WB" intended to be "WP" - "Washington Post"?} complaint it would be a nothing. In a very technical sense I think it is a nothing."
• "So if the question is will the church lose its status, the answer is almost surely no. But if the question is whether the brothers raised real and legitimate questions that touch seriously on tax law in its largest sense, the answer is yes."
• "[T]here is really no provision that blows up the exemption of a church because it has saved up too much money."
• "Mr. Nielsen also focuses on the question about total book value of assets not being disclosed. You can figure out the correct tax without knowing that, but I do believe in answering all the questions. So he does have a point. It is just not that big a one."
• "I guess my plea [about my previous summery of the Nielsens' arguments] would be that it is really hard to boil this all down."

If you have time, it's worth a read.

Thanks,

-Smac

 

[pogi]

2 hours ago, Scott Lloyd said:

A good point and a good post. So good that I hesitate to quibble, but the Tabernacle is not a good example for your point. 
 

The Tabernacle Choir originated under Brigham Young’s presidency as a group of Welsh converts who had arrived in the Salt Lake Valley and organized themselves into a volunteer choir, not unlike our ward choirs of today.  It grew from there. 
 

The Tabernacle Choir has never been a profit-making entity. It exists on philanthropic donations. Even its commercial recordings, paid concerts and network broadcasts do not come anywhere close to meeting expenses. I doubt tithing funds have ever been used to support the choir, which has always been regarded primarily as a missionary tool for the Church. 

That actually really surprises me, absolutely shocks me actually, that they haven't made a profit from album sales alone considering they are all non-paid volunteers and have 5 gold and 2 platinum records and a Grammy under their belt. Their wardrobes and travel expenses must really add up!

That is 4.5 million records sold for those albums alone!  At $10 an album, we are talking over 40 million dollars!

Edited December 21, 2019 by pogi