Church fined by SEC

[SteveO]

6 minutes ago, Teancum said:

But the Church likely saw the writing on the wall and gave up $5 milion for it not to go further and for the SEC to use "nicer" language.  

If they had paid an extra $5 million, do you think the SEC would’ve included something even “nicer”?

[SeekingUnderstanding]

Sam Brunson who downplayed any tax problems when the whistle blower first went to the post has a harsher take this time:

https://bycommonconsent.com/2023/02/21/the-church-the-investment-advisor-and-the-sec/
 

But here’s the thing: the church didn’t make a mistake. It’s not that it was unaware that EPA had a filing requirement—EPA informed the top church hierarchs almost immediately that it needed to file 13Fs.

But rather than comply with the law, top church leaders decided to obfuscate, to stretch the law to (or, imho, beyond) the breaking point. It’s not that mistakes were made—it’s that the church took deliberate action to do wrong.

And how should we, as active members, look at this deliberate action to do wrong? I don’t think there’s any way to justify it, and I don’t think members should be asked to justify it. After all, we believe in being honest. To receive a temple recommend, we have to affirm that we’re honest in our dealings. Seriously, honesty is such a lonely word.

[Snodgrassian]

11 minutes ago, CV75 said:

OK so it's just a finding, part of the allegation.

do you really think the Church paid a fine, with the widow's mite, due to a finding? allegation? 

[bluebell]

16 minutes ago, Teancum said:

What you do not seem to grasp is there is a give an take in some of these cases. The SEC likely would have been more heavy handed in this case had the Church tried to fight.  But the Church likely saw the writing on the wall and gave up $5 milion for it not to go further and for the SEC to use "nicer" language.  

Why do you think the Church set up these LLCs?  

There are a lot of things I don’t grasp. But we probably disagree on what some of those are.

it seems clear that the church set up the multiple LLCs to try to keep the scope of its investments/funds/whatever that stuff is called from public knowledge.  I don’t personally have a problem with that, so it’s not a gotcha question to me.

But I do think the church was wrong to try to hide it or to mislead. Even if they thought legally, they could do it.

[bluebell]

18 minutes ago, ttribe said:

No, it is a finding of the Commission. I've discussed this already, above.

I wonder—and this is not a question used as an attempt to argue that the church isn’t guilty of anything or that the facts in this case are not true—if this had gone to trial, would those facts then become allegations?

Because isn’t the whole point of a trial to prove whether or not the “facts” are actually factual?

Or is this different than like a criminal trial were lawyers use the term “fact” in a much more loose, this is what we want you to decide is true, way?

[CV75]

9 minutes ago, Snodgrassian said:

do you really think the Church paid a fine, with the widow's mite, due to a finding? allegation? 

As I've noted in earlier posts, ethical and moral sensitivities differ among the posters. But yes, the negotiated resolution to the allegation was to pay a fine.

[CV75]

25 minutes ago, ttribe said:

The Church agreed to this Order which states it violated securities law. Not an allegation.

When I see what an "order" is / entails, I'm not seeing any violation of Section 23, which empowers the SEC to make rules, regulations, orders, etc.: Securities Exchange Act of 1934 (nyse.com)

Edited February 22, 2023 by CV75

[pogi]

2 hours ago, bluebell said:

I agree that our emotional reactions to these findings, which themselves stem from our biases, impact our interpretation of things and will sometimes naturally lead to dramatic expressions.

You have to understand that I was not angry or biased against the church before reading the SEC report. 

2 hours ago, bluebell said:

When attempting to sus out allegations and facts, etc. I just find them kind of useless (in that context). I’ve mostly been skipping the posts where it’s obvious that is happening. I wanted ttribe to know I appreciate his efforts, otherwise this thread would be a quagmire of drama and I’m not interested in wading through all of that emotion right now.

I understand not wanting to read emotional stuff.  I will try to tone it down.

2 hours ago, bluebell said:

I’m working my way through the SEC order, though Smac has pointed out some reasons why it’s not super easy to interpret either. Lots of legal language and legal definitions I’m not familiar with.

Please understand that Smac is just as biased as anybody else.  His defense of the church is beyond predictable - it is a given.  I have always given the church the benefit of the doubt, but I also call things out where there is little reason to doubt.  I think I am more middle ground and less biased than many.  I don't feel compelled to injure the church or defend them. I expect them to be human and make mistakes, but I have always trusted them.  If anything I am biased towards trust, which is why this hurts.  

I don't find the report to be difficult to understand in many important ways.  For example:

Quote

 

27. Each Form 13F filed in the name of a Clone LLC misstated that the LLC had sole investment discretion for the securities listed, that there were no other managers for these securities, and that the Clone LLC had sole voting discretion over these securities. Even though the IMAs [Investment management agreement] stated that Ensign Peak had delegated investment discretion, Ensign Peak continued to manage the entire portfolio and at all times maintained investment and voting discretion over all the securities listed in the Forms 13F. 

No confusing legal jargon there.  This happened in every form of every clone LLC, every year for 20 years.  "Even though" they knew the LLC didn't have delegated sole investment discretion, they reported it as if they did.  If this happened once on one report it could reasonably be understood to be an unintentional "mistake", but when it happens on every report for 20 years?  Not so much.  The SEC made it clear that the intent of the church was to keep these accounts hidden from the public - lying (yes, I am going to use that word as defined by the church) on these reports made that possible.  Then it is clear they took more efforts to keep this lie hidden even from the designated business managers: 

Quote

28. Each Form 13F was signed by the designated Business Manager. The signature page stated, “The institutional investment manager filing this report and the person by whom it is signed hereby represent . . . that all information contained herein is true, correct and complete[.]” However, Ensign Peak provided the Business Managers with insufficient information about the Clone LLCs or the securities assigned to them that would enable the Business Managers to make this representation. When Ensign Peak obtained the Business Managers’ signatures for the Forms 13F, Ensign Peak gave the Business Managers only the signature pages of the Forms 13F and not the complete documents. 

Hiding this from the business managers demonstrates that they knew something shady was going on.  It is not normal and ethnical business practice to have someone sign documents attesting that the information is true and correct without giving them the actual documents to read.   

Why did they go to these "great lengths" to misstate the facts every year in every filling and hide it from the managers?  "to avoid disclosure of the amount and nature of its assets."   That aligns perfectly with Clarke's testimony.  I therefore have ZERO reason to doubt him.  

2 hours ago, bluebell said:

As for Clarke, I have no idea who he is so my reaction to him tends to be neutral. Neither untrustworthy nor trustworthy. Where he is able to provide evidence of his accusations I have no problem accepting them. Where he is unable to provide evidence, I’ll take that with a grain of salt since I have no idea what his personal biases are.  That is not a negative judgement against him but an acknowledgment of my limited ability to judge the merits of his claims if I have nothing to go off but his word.

Until someone provides a better source, he is the most reliable source I have found.  Honestly, what source would be good enough for you if not the President of the EPA who has every reason to defend the EPA and the Church's integrity? 

Edited February 22, 2023 by pogi

[bluebell]

23 minutes ago, ttribe said:

The Church agreed to this Order which states it violated securities law. Not an allegation.

This is why I think legal speak is so incredibly annoying. Because essentially the church agreed to this order which states it violated securities laws, and the church also agrees that it committed no wrongdoing.

both statements, though contradictory, are accurate. Legal speak is such a mess sometimes.

[Teancum]

21 minutes ago, bluebell said:

There are a lot of things I don’t grasp.

Yep

21 minutes ago, bluebell said:

 

But we probably disagree on what some of those are.

Ok

 

21 minutes ago, bluebell said:

it seems clear that the church set up the multiple LLCs to try to keep the scope of its investments/funds/whatever that stuff is called from public knowledge.  I don’t personally have a problem with that, so it’s not a gotcha question to me.

So you are quite fine with dishonesty and skirting the rules?  What is that TR question about honesty or has that been dropped?

21 minutes ago, bluebell said:

But I do think the church was wrong to try to hide it or to mislead. Even if they thought legally, they could do it.

Yea call me skeptical.

[pogi]

1 hour ago, The Nehor said:

I agree with the concept that this is akin to paying a speeding ticket fine.

A speeding ticket doesn't require intentional deception.   There is no way that these things can be explained as unintentional. 

They dishonestly hid truths about the EPAs control over the LLCs from the SEC and from managers in an attempt to hide things from the public.  As is the case with lying, it often ends up leading to a web of lies to different entities and individuals in order to keep the original deception secret.  They lied about the location of the managers too in an effort to deceive.  It just goes on and on.  That doesn't happen with a traffic ticket. 

Quote

 

Each Form 13F also misstated that the Business Manager signed the Form 13F from the address listed on the signature page. In fact, all Business Managers were located in Salt Lake City, and the addresses on the forms were used to convey the impression that the Clone LLCs were located across the country

Each Clone LLC was given an address outside of Utah although none of them conducted any business at those locations other than the receipt of mail. Ensign Peak chose multiple locations across the country for these purported offices to create the impression that the Clone LLCs conducted business operations throughout the U.S., making it more difficult to trace the Clone LLCs back to Ensign Peak or the Church.

 

 

Edited February 22, 2023 by pogi

[CV75]

2 hours ago, theplains said:

Thank you for that comparison.

Here is a snip from a BYU speech.

https://speeches.byu.edu/talks/dallin-h-oaks/honest-behavior/

A lie is not always told in so many words. It may be a creature of concealment or a 
misrepresentation by action or a half-truth. 

In the long run, the course of absolute honesty and total truthfulness is not only 
the best course but also the easiest. The person who lies and then must tell another 
lie to cover the first, and then another and another until he has built a whole 
overlapping shingled roof of lies is a person to be pitied. At some point one of 
those covering lies will be exposed, and the whole overlapping structure will come 
down with a clap of thunder like the doomsday bell. The liar’s iniquity will truly 
be “spoken upon the housetop.”

A person who is only partially honest and only partially truthful is always having 
to make hard decisions about whether each new circumstance of life calls for honesty 
or deceit. 

Here is a Church definition, for Gospel purposes, of lying: Lying (churchofjesuschrist.org)

"Any communication of falsehood or untruth for the purpose of deception." and pertinent scriptures follow.

No such purpose is mentioned in the order: 34-96951.pdf (sec.gov)

 

[CV75]

4 minutes ago, Teancum said:

Yep

Ok

So you are quite fine with dishonesty and skirting the rules?  What is that TR question about honesty or has that been dropped?

Yea call me skeptical.

Here is a Church definition, for Gospel purposes, of lying: Lying (churchofjesuschrist.org)

"Any communication of falsehood or untruth for the purpose of deception." and pertinent scriptures follow.

No such purpose is mentioned in the order: 34-96951.pdf (sec.gov)

[SeekingUnderstanding]

1 minute ago, CV75 said:

Here is a Church definition, for Gospel purposes, of lying: Lying (churchofjesuschrist.org)

"Any communication of falsehood or untruth for the purpose of deception." and pertinent scriptures follow.

No such purpose is mentioned in the order: 34-96951.pdf (sec.gov)

 

“We are not a wealthy people but we are good people, and we share what we have” - Elder Neil Anderson. 
 

“I answered that the church is not wealthy” -President Monson.

 

Also your church: doing everything conceivable to hide its wealth from its members and the public. 
 

 

[bluebell]

18 minutes ago, Teancum said:

Yep

Ok

 

So you are quite fine with dishonesty and skirting the rules?  What is that TR question about honesty or has that been dropped?

Yea call me skeptical.

Never mind. There is no benefit to having this discussion with you.

That much I have learned to grasp.

Edited February 22, 2023 by bluebell

[SeekingUnderstanding]

2 minutes ago, bluebell said:

What is dishonest or rule skirting about not wanting the investment stuff public?

Elder Ballard in a fireside:

”But it’s this idea that the church is hiding something, that we would have to say as two apostles who have covered the world and know the history of the church and know the integrity of the First Presidency and the quorum of the twelve from the beginning of time. There has been no attempt on the part, in any way, of the church leaders trying to hide anything from anybody.”

[ttribe]

24 minutes ago, bluebell said:

This is why I think legal speak is so incredibly annoying. Because essentially the church agreed to this order which states it violated securities laws, and the church also agrees that it committed no wrongdoing.

both statements, though contradictory, are accurate. Legal speak is such a mess sometimes.

To be clear, they neither admitted guilt, nor denied it. I included a link to why this happens elsewhere in this thread.

[SteveO]

7 minutes ago, pogi said:

A speeding ticket doesn't require intentional deception.   There is no way that these things can be explained as unintentional. 

It requires you going beyond the posted limits and hoping you don’t get caught.  You can do it for years, maybe decades, until one day you see a patrol car pull out behind you.

That’s exactly the what the church did.  Whoever it was that made the decision to “speed,” did it for as long as they could, hoping they wouldn’t get caught.  But they got caught.

[Teancum]

12 hours ago, smac97 said:

Actually, there is nothing wrong with that.

There is something wrong with concealing it when the SEC requires disclosure.  And that in spite of your voluminous political post about various federal agencies.

 

12 hours ago, smac97 said:

I am open to correction, of course.  Feel free to correct me by publishing the entirety of your personal finances for public consumption.  "Sauce for the goose" and all that.

Yea this quite frankly is a stupid nonsensical argument.  When @ttribe has a hundred billion in managed assets that are subject to security law requirements then you might have a point.  Till then this is typical deflection.

 

12 hours ago, smac97 said:

As soon as you publish the entirety of your personal financials to the world, I'll start taking seriously your pronouncements about what is "ethical" and what is not.

As soon as you stop from nonsensical argument maybe we will take you seriously.

12 hours ago, smac97 said:

As I understand it, the SEC Order contains allegations.  Claims of fact not yet proven to be true.

Thanks,

-Smac

You must not have read their report.

Edited February 22, 2023 by Teancum

[ttribe]

35 minutes ago, bluebell said:

I wonder—and this is not a question used as an attempt to argue that the church isn’t guilty of anything or that the facts in this case are not true—if this had gone to trial, would those facts then become allegations?

Because isn’t the whole point of a trial to prove whether or not the “facts” are actually factual?

Or is this different than like a criminal trial were lawyers use the term “fact” in a much more loose, this is what we want you to decide is true, way?

I don't know the procedural elements well, I'm afraid. I suspect that the Commission's findings of fact would be presented as such, but I do not know how that would be treated by the court. I'm sorry.

[pogi]

2 minutes ago, SteveO said:

It requires you going beyond the posted limits and hoping you don’t get caught.  You can do it for years, maybe decades, until one day you see a patrol car pull out behind you.

That’s exactly the what the church did.  Whoever it was that made the decision to “speed,” did it for as long as they could, hoping they wouldn’t get caught.  But they got caught.

One can get a traffic ticket for unintentional speeding too.  And that is how the EPA is trying to paint this - as an unintentional mistake without intent to hide anything.   That is just another part of the web of lies.  Traffic tickets don’t require such “great lengths” to deceive and justify their behavior.

[Teancum]

15 minutes ago, CV75 said:

Here is a Church definition, for Gospel purposes, of lying: Lying (churchofjesuschrist.org)

"Any communication of falsehood or untruth for the purpose of deception." and pertinent scriptures follow.

No such purpose is mentioned in the order: 34-96951.pdf (sec.gov)

 

Quote

 

We Must Not Excuse Our Dishonesty

• What happens to us spiritually when we excuse our dishonesty?

People use many excuses for being dishonest. People lie to protect themselves and to have others think well of them. Some excuse themselves for stealing, thinking they deserve what they took, intend to return it, or need it more than the owner. Some cheat to get better grades in school or because “everyone else does it” or to get even.

These excuses and many more are given as reasons for dishonesty. To the Lord, there are no acceptable reasons. When we excuse ourselves, we cheat ourselves and the Spirit of God ceases to be with us. We become more and more unrighteous.

We Can Be Completely Honest

• What does it mean to be completely honest?

To become completely honest, we must look carefully at our lives. If there are ways in which we are being even the least bit dishonest, we should repent of them immediately.

When we are completely honest, we cannot be corrupted. We are true to every trust, duty, agreement, or covenant, even if it costs us money, friends, or our lives. Then we can face the Lord, ourselves, and others without shame. President Joseph F. Smith counseled, “Let every man’s life be so that his character will bear the closest inspection, and that it may be seen as an open book, so that he will have nothing to shrink from or be ashamed of” (Gospel Doctrine, 5th ed. [1939], 252).

• In what ways does our honesty or dishonesty affect how we feel about ourselves?

 

• https://www.churchofjesuschrist.org/study/manual/gospel-principles/chapter-31-honesty?lang=eng

   

[Teancum]

14 minutes ago, bluebell said:

Never mind. There is no benefit to having this discussion with you.

That much I have learned to grasp.

Likewise.  You cannot seem to hold your church accountable to the same standards it expects of you. It is pretty clear your church went to great length to keep their massive investment fund secret.  Secret from the public and secret from its members.  The fine should have been much more than $5 million.

[Calm]

19 minutes ago, SteveO said:

It requires you going beyond the posted limits and hoping you don’t get caught.  You can do it for years, maybe decades, until one day you see a patrol car pull out behind you.

That’s exactly the what the church did.  Whoever it was that made the decision to “speed,” did it for as long as they could, hoping they wouldn’t get caught.  But they got caught.

So my question is was it like going 5 miles over the speed limit or more like going 50 miles over it in a school zone as school lets out?  At least there is not a dead body in the trunk.

Edited February 22, 2023 by Calm

[Calm]

7 minutes ago, Teancum said:

Likewise.  You cannot seem to hold your church accountable to the same standards it expects of you. 

You are clueless here about bluebell.  What gives you the right to condemn someone who is trying to understand the idiotic law system that many who are elected to do so seems unable to manage?  She lacks your training and is therefore hesitant to assume she has things down, but still is making and effort to understand based on all the information that has been provided and trying to fill in gaps and you go to this.  So uncalled for.  Jerk move.

Edited February 22, 2023 by Calm