Church fined by SEC

[Durangout]

For some reason this question comes to mind:  Are you honest with your dealings with your fellow man?

[Teancum]

57 minutes ago, smac97 said:

Oh brother.  Yes, it was to comply with the law.  There is nothing wrong with using legal means to maintain privacy.

Thanks,

-Smac

Really?  Then why was there a $5 million fine?  

[Tacenda]

Reddit is on fire with these statements and memes. But hopefully the church will learn from this and change and live up to what it tells it's members. 

"Bishop I have no income because all my money goes to a shell company that pays my bills." (tithing settlement?)

The church clearly needs to go back to the original statement and not the hidden one using ellipses. 

Edited February 22, 2023 by Tacenda

[mrmarklin]

36 minutes ago, SeekingUnderstanding said:

Except it was illegal…

Nothing the Church did was illegal.  If it was, the Church would have had to acknowledge it in the settlement.

IMHO the Church "hid" what they were doing for one good reason and one bad one.  This according to their own lights.

The bad reason was that the fund was getting too big, and they thought that having so much money would inhibit tithing payments.

The reasonable reason was that by multiplying the funds, the Church could mitigate "tracking" by investors that would want to invest in the "Lord's" way.  Who could blame them?

It's interesting to note that the portfolio is worth "only" $44 Billion according to the latest filings.  Not $100 Billion.  I doubt the 100B was a real number.

[smac97]

I am curious as to responses to all of your thoughts of Sam Brunson's assessment of this matter, which to me seems a bit . . . off.

In his blog entry, we get this:

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What to Make of This?

I’ve spent a lot of time explaining why the Sturm und Drang over the EPA’s taxes is overblown. And I stand by that. With what has been brought to light by the whistleblower and by other investigators, EPA and the church are perfectly compliant with federal tax law.

But not with securities law.

So he wants to differentiate the hullabaloo over "over the EPA's taxes" from EPA's compliance with reporting 13F reporting requirements, apparently solely because the Church's efforts as to the latter were apparently not "perfectly compliant" with federal securities law.

Okay.  Assuming the Church erred in its compliance, I still don't see a reasoned justification for the current "Sturm und Drang" to which Brunson is contributing.

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It’s telling that in their release, the church stated that it “regret[s] mistakes made,” a statement that, frankly, as passive as it is, is as close to an expression of wrongdoing as I’ve heard the church make.

"Wrongdoing" meaning . . . not being "perfectly compliant" with federal securities laws?  Which laws are, per the PSM article, "very complex—according to one lawyer, 'some of the most complex disclosure regimes found anywhere on the planet'"?

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But here’s the thing: the church didn’t make a mistake.

Um, what?  Per the SEC, it sure seems like the Church did "make a mistake."  

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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.

Weird.  Nobody is claiming that the Church's "mistake" was that it was "unaware that EPA had a filing requirement."  Instead, the "mistake" alleged by the SEC was how EPA and the Church went about attempting to comply with filing/disclosure requirements.

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But rather than comply with the law,

This is crapola, in my view.  And it makes Brunson look pretty bad.  He is imputing motives here.  He is reading minds.  He is, or ought to be, better than this.

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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.

Again, I think this is crapola.  Notice that even in denouncing "top church leaders" he hedges his bets with an "imho."

"The Church took deliberate action to do wrong" is, I think, unfair by a country mile.  The Church took deliberate action after having received legal advice on how to proceed.  

One of the commenters on his post ("SK") makes this same point: 

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However, you chose not to include the portion of the Church’s statement that it relied on legal advice in making its decision regarding how to comply with SEC reporting requirements. As a lawyer, you know that neither the fact that the SEC alleged that the Church’s actions were non-compliant, nor the Church’s offer to settle the allegation by paying a fine is equal to a legal determination that the actions did, in fact, violate applicable laws. When evaluating their legal obligations, organizations frequently rely on legal advice from their attorneys. If a government agency challenges the organization’s action, it is not at all unusual for the organization to settle with the agency rather than to become involved in expensive and time-consuming administrative or legal proceedings.

And another ("Nate") :

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This was a narrow issue. And the narrow issue has been fixed for more than three years now. While it is unfortunate that there was ever a misunderstanding about disclosure requirements based on the advice of counsel, it’s also probably unavoidable that in its more than 25-year history EPA would make some mistake on its disclosure requirements. Once again, its overall record on compliance is impeccable.

Another commenter, "Brian," has this to say:

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I’m a securities lawyer, though haven’t ever dealt with Forms 13F specifically. A few points on this:

1) As I see it, it’s difficult to know what culpability Church leaders have in this situation. As others have said, and I second, the securities laws are quite complex. If Church leaders desired to maintain privacy while also giving the disclosure that is required under law, they may have thought that they accomplished both goals by setting up the LLCs. As I understand it, those LLCs reported all the holdings that were required to be reported, but did so in a way that didn’t tie them to the Church. It’s not an illegitimate goal to maintain privacy of financial information. It is possible that they intended to comply and thought that they were complying. It’s also possible that they knew they were in a gray area or pushing over the line and yet decided to take the risk. I don’t believe enough information is available publicly to fully evaluate this question.

"It's not an illegitimate goal to maintain privacy of financial information."  Many on this thread, though, are saying or heavily implying otherwise.

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2) What most people do not appreciate is that the securities laws and rules are a very complex web of statute, regulation, practice, and enforcement where interpretation in many instances is unclear or highly ambiguous. Even those who intend to comply fully with the securities laws and regulations can find themselves in trouble without meaning to.

I have raised this point several times.  It is not getting enough attention.

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In addition, and I can’t emphasize this enough, the SEC’s enforcement arm is likely to take the most aggressive reading of any particular statute or regulation while others may take a significantly different view. Over the years, the SEC has been defeated in a number of enforcement actions when its interpretations have been challenged in court. The SEC’s interpretations of statutes and regulations are not law.

I have addressed this as well.  The SEC document is, I think, not intended as an adjudicative decision.  It is "not law."  It's the SEC's untested because-we-say-so conclusion.

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However, a party under investigation may choose to settle, even believing that they have the better argument, because the consequences of fighting the SEC can be catastrophic, both in terms of time and money lost, impact to reputation (even if you win), and the fact that litigation can be a huge gamble with devastating penalties if you end up with the wrong judge or jury. I’m not saying that is the case here – I don’t know – but without having more information, I am saying it is plausible.

I have raised this point as well.  Parties settle legal disputes all the time, including parties who have not done anything wrong, or whose wrongdoing was inadvertent, or minor, or is being overblown, etc.

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I’m a securities lawyer and I think defendants in securities law trials are at an even worse disadvantage in securities law cases than they would be in other cases. The securities statutes and regulations in many cases are vague and difficult even for securities lawyers to parse and fully appreciate and understand, let alone someone who doesn’t have expertise in the subject. A defendant in a securities law matter would have very justifiable concerns that the defendant would not receive a fair trial.

I think this is one of the great perils of the Administrative State.

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3) If full public disclosure of the Church’s securities holdings was made (and I understand that such disclosure was made), it is difficult for me to see any “victims” in this situation.  Would love to hear Sam or others articulate in more detail who the victims were in this situation rather than some vague “people were harmed” standard. I’d wager that the average investor doesn’t look at Forms 13F. For institutional investors, the large data services would have picked up on the individual 13F filings that the church made and would note that X% of Apple was held by institutional investors and provide a breakdown of who held it. Yes, they wouldn’t have known that the Church held the stock, but is that material to their decision to invest in Apple or some other company? Doubt it.

This is a fair point, and one I had not really considered.

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4) Yes, of course, it’s really unfortunate to see the Church get dragged through this. I certainly think it’s regrettable and wish they had chosen a different path to comply with the 13F rules. But as some grand lesson on hypocrisy and moral culpability, I’m not really buying it.

Same here.

Back to Brunson's article:

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And how should we, as active members, look at this deliberate action to do wrong?

Oh, brother.  He's stacking the deck here.  Poisoning the well.

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I don’t think there’s any way to justify it, and I don’t think members should be asked to justify it.

I don't think anyone is looking to "justify" anything.  However, I think there are plenty of people who want to use this story to condemn, on moral / religious grounds, the Church and its leaders.

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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.

Oi.  Technical noncompliance with an arcane administrative rule, particularly when such noncompliance was based on legal advice, does not contravene these precepts.

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And, in spite of our teachings and belief, the top church leaders chose dishonesty. They chose not only to bend the law, but to break it.

Again, oi.  He's way out of line here.  And don't take my word for it.  Later on he essentially contradicts this conclusion when responding to comments to his article.

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And it’s worth noting that, since 2019, Ensign Peak Advisors has filed its Forms 13F. The church and EPA acknowledged that they had acted wrongly. They fixed the problem and paid the necessary fine.

And yet Brunson gives the Church no credit here.  

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Which leads to the last line of the church’s statement: “We affirm our commitment to comply with the law, regret mistakes made, and now consider this matter closed” (emphasis added).

So here’s the thing: the church may consider the matter closed. But it’s not.

Well, perhaps it is.

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This represents a real betrayal to the millions of church members who have worked hard to live up to their standards, to be honest even where it’s hard, to obey the law even where it’s inconvenient.  It represents a deeply disappointing disclosure to the millions of Saints who have looked to the church as a model for how to act and how to live.

No, I don't think this is anything like "a real betrayal."  

Again, the issue here is technical compliance with an SEC regulation.

Again, the Church sought, and then acted on, legal advice as to how to comply with this regulation.

Again, the SEC - in hindsight - disagreed that the Church's effort to comply was sufficient.

Again, the SEC's factual findings and legal conclusions have neither been admitted nor denied by the Church.

Again, the SEC's factual findings and legal conclusions are not an adjudicative finding.

I don't think Brunson is being fair or accurate here.

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And saying “this matter [is] closed” doesn’t address that betrayal, that disappointment, that hypocrisy.

Brunson is here assuming, without having demonstrated the existence of, "betrayal," and "hypocrisy."

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To move forward, the church needs to address its error.

It did.

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Not to the SEC—it’s already done that—but to its membership. It needs to explain what went wrong, why it went wrong, how it will ensure it doesn’t go wrong again.

I disagree.  The Church took remedial measures several years ago.  The Church is now fully compliant with SEC disclosure requirements.  The Church has acknowledged its "mistakes," and has agreed to pay a fine.

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Members have believed that the church represents a model for their lives for a long time.

And, absent an expectation of infallibility being projected onto it, it continues to do so.

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And, even in the wake of this news, the church can do that: it can model how to repent and come back from severe errors.

Meh.  Technical noncompliance with an SEC regulation is not a "severe error."  Nor is it a moral one.

As for some sort of call for institutional "repentance," I don't accept that at all.  Repentance is an individualized thing.  

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But simply paying a fine, then ignoring the harm, is not that model.

Brunson hasn't shown "the harm."  And I don't think he can, hence the need to keep it nice and vague and abstract.

From the comments section, "Mike Sanders" poses the following inquiry:

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Sam,

“church leaders knew what they wanted, and that was to avoid mandated disclosure.”

And apparently all they would have had to do differently in order to gain this desire without falling out of compliance would have been to devolve investment authority to the LLCs, right?

Sam responds:

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Mike, I think so. It still may have looked bad, but as far as I can see, it would have complied with the letter, and probably the spirit, of the law.

What?  What?  

Sam Brunson in his article:

• "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?"
• "And, in spite of our teachings and belief, the top church leaders chose dishonesty. They chose not only to bend the law, but to break it."
• "This represents a real betrayal to the millions of church members who have worked hard to live up to their standards, to be honest even where it’s hard, to obey the law even where it’s inconvenient. It represents a deeply disappointing disclosure to the millions of Saints who have looked to the church as a model for how to act and how to live."
• "And saying “this matter [is] closed” doesn’t address that betrayal, that disappointment, that hypocrisy."

The phrase "them's fightin' words" comes to mind. 

And per Sam Brunson, the lynchpin of his condemnations is . . . the Church's failure to "devolve investment authority to the LLCs."  If the Church had done this, then - per Sam - "it would have complied with the letter, and probably the spirit, of the law."

Oh.  That seems like a pretty substantial admission on Sam's part.  It eviscerates his condemnations, I think.  It demonstrates that the Church's "action to do wrong" was not any sort of moral failing, but rather an alleged failure to technically comply with an arcade federal regulation.  

That's not to say that these technicalities can be disregarded.  Again, the Church ought to follow the law the same as everyone else.  I just don't see any sort of moral failing here, and Brunson's denunciations of the Church and its leaders therefore seem problematic.

Thoughts?

Thanks,

-Smac

Edited February 22, 2023 by smac97

[The Nehor]

55 minutes ago, smac97 said:

Please blaze the trail you think the Church ought to take.  What is your real name?  Your address?  Phone number?  Email address?  Where do you bank?  What are your assets?  What is your Social Security Number?  What are your logins and passwords for email provider, bank websites, etc.?

Surely you are not going to "{go} to great lengths to hide things they want to keep hidden" by not immediately publishing these things to the world?  "Sauce for the goose" and all that.

You undermine everything you say when you resort to this inane comparison.

[The Nehor]

3 minutes ago, mrmarklin said:

Nothing the Church did was illegal.  If it was, the Church would have had to acknowledge it in the settlement.

That is not true. Settlements often involve a party not acknowledging they violated the law even when it is clear they violated the law. Not saying this is completely the case here but the generalization you make is untrue.

[SeekingUnderstanding]

1 minute ago, mrmarklin said:

Not $100 Billion.  I doubt the 100B was a real number.

The whistleblower stated that the amount of US equity that would be subject to this SEC filing was just over 35 billion right? In 2019. And the rest was well diversified in private equity, international equity and real estate. Looks like he was spot on. 

[bluebell]

31 minutes ago, ttribe said:

You'd have to state that it (the Church) also does not disagree that it violated securities law to make it fully accurate.

The idea that you can both agree and not agree at the same time, is such an example of why people struggle so much with legal talk and this topic.

It’s nonsensical in a lot of ways, and yet also legally binding.

[Analytics]

1 hour ago, smac97 said:

By the express terms of the SEC Order, the Church has neither admitted nor denied any of the allegations in the Order.

Yet you claim some (all?) of the things the SEC determined to be facts are disputed. Which of their “facts” are disputed? 

[CV75]

2 hours ago, Teancum said:

“I was impressed by the great change that had come over this young man while he served on his mission and studied moral principles. How unfortunate it is that he had to learn his lesson the hard way, but what a great blessing comes when there is the realization that one cannot be in violation and feel good about that conduct” (“Basic Concepts of Honesty,” New Era, Feb. 1978, 4–5).

• Are we being dishonest when we break the laws of the land? Why?

• Write on the chalkboard We believe in being honest.

The thirteenth article of faith, written by the Prophet Joseph Smith, states, “We believe in being honest, true, … virtuous, and in doing good to all men.” In this and many other scriptures the Lord has commanded us to be honest in our personal lives and in our dealings with others.

• What does it mean to be honest? (It is doing what we know is right. If we make promises, we keep them. If we have a debt, we pay it. Honesty is to speak the truth and act truthfully. It means that we do not lie, steal, or break the laws of the land. It means that we do not deceive in any way.)

The Importance of Honesty

Being honest is necessary if we are to live the gospel of Jesus Christ. If we know the truth but do not live it, we are dishonest with ourselves and with God. To be honest with ourselves and the Lord, we must keep the covenants we have made. We must be honest to have the Holy Ghost as our companion.

Being honest with ourselves and God means that we must also be honest with those around us. If we are, the Lord will bless us with His Spirit, and we will earn the trust, honor, and loyalty of those with whom we associate. Our honesty with others will enable us to serve them and magnify our callings.

• Read the following situations. Discuss as a class what you would do in each situation.

Example 1

Elder O. Leslie Stone recalled this experience: “Recently, our grandson, Adam, was traveling with Sister Stone and me on a trip to California. About noontime we stopped for lunch. When the waitress brought the bill I didn’t pay very close attention, and after she gave me my change, I realized that she had charged me for only two sandwiches instead of three.”

• What was the honest thing to do? If this happened to you, how could you teach your children about being honest?

Elder Stone continued:

“I knew that the girl would be short [of money] at the end of the day, and there suddenly flashed into my mind the thought of how my father had taught me to be honest. I felt this was a good time to talk to Adam about honesty, and so we sat down and I explained what had happened. I told him we had a problem.

“I said we could leave now and keep the extra change and no one would ever know the difference, or we could tell the girl that we still owed her for a sandwich. Our decision wasn’t at all difficult to make when we decided that if we kept money that did not belong to us that we would be breaking the commandment, ‘Thou shalt not steal.’ We agreed that our Heavenly Father would be displeased with us and we would be unhappy too because we would know in our hearts that we had not been honest.

“Adam and I approached the girl at the counter, and I explained to her that she had undercharged us and that we owed almost a dollar more. Her face flushed in embarrassment for a moment, and then she thanked us for telling her of the mistake. We continued on our way with a good feeling, and I am sure our Heavenly Father approved of what we had done” (“Be Honest,” Friend, Jan. 1975, 7).

Example 2

Elder Gordon B. Hinckley recalled: “Recently we rode a train from Osaka to Nagoya, Japan. At the station were friends to greet us, and in the excitement my wife left her purse on the train.”

• If you had found Sister Hinckley’s purse, what could you do?

Since Elder Hinckley believes that most people are honest, he “called the Tokyo station to report it. When the train arrived at its destination some three hours later, the railroad telephoned to say the purse was there. We were not returning via Tokyo, and more than a month passed before it was delivered to us in Salt Lake City. Everything left in the purse was there when it was returned” (“An Honest Man—God’s Noblest Work,” New Era, Oct. 1976, 47).

• What does the Lord expect of us when we find someone else’s property?

The Lord has said, “If thou shalt find that which thy neighbor has lost, thou shalt make diligent search till thou shalt deliver it to him again” (D&C 136:26). The Lord expects us to be completely honest. To Him, anything that is not completely honest is dishonest; there is no such thing as partial honesty.

• How can we recognize what is honest and what is not? Have a class member read Moroni 7:16–17.

• Who is the source of good? What are the results of honest acts? (Good, belief in Christ, service to God) Who is the source of evil? What are the results of dishonest acts? (Evil, unbelief in Christ, denial of Him, disservice to God)

• Have class members discuss the following situations. They should decide if the person involved is being completely honest.

  1. Dad has never had a traffic ticket. He is a good driver. He always watches carefully and tries to obey all traffic laws.

  2. While at work, John uses company stamps to mail letters to his sick mother (see D&C 42:54).

  3. Jack and Leo are the best of friends. They are willing to let each other borrow anything. After one borrows something from his neighbor, he promptly returns it. (See Mosiah 4:28; D&C 136:25.)

Honesty in the Family

Priesthood holders should not only strive to be honest themselves but should also teach their children to be honest. President N. Eldon Tanner said: “This training in honesty begins in the home. Each of us has personal possessions which … should not be taken without the consent of the owner. A child who respects such honesty in the home is not apt to violate the principle outside the home. On the other hand, lack of such training fosters disrespect for the rights and property of others” (in Conference Report, Apr. 1978, 64; or Ensign, May 1978, 44).

• What can we do in our families to teach and encourage honesty?

President Brigham Young said:

“Be honest. Woe to those who profess to be Saints and are not honest.

“Honest hearts produce honest actions” (as quoted by Spencer W. Kimball, in Faith Precedes the Miracle [1972], 234).

When we are interviewed to receive a temple recommend, we are asked if we deal honestly with others. An experience of one member of the Church, President Ruben Dario Pacheo of Caracas, Venezuela, illustrates the kind of honesty expected of us:

President Pacheo and his family wanted to go to the temple. After much sacrifice and spiritual preparation, he and his family raised the money for the long trip. President Pacheo sent his daughter to the bank to get 500 U.S. dollars. He said:

“My wife took the envelope and put it away without counting the money. The night before leaving, I asked for the money and noticed that the envelope was unusually heavy. We counted the money. They had given us $4,065. I was astonished. … The bank receipts indicated a purchase of only $500—that meant that the bank had erred some $3,500 in our favor!

“Some nonmember friends at our home that night tried to persuade us to use the money to enjoy our trip to the United States. To be honest, I myself had never seen so much money in my life. However, I energetically said, ‘We cannot keep this money because it is not ours. The purpose of our trip to the temple is to make covenants with the Lord. What good will they do if we are dishonest?’

“We returned the money to the bank; they had noticed that they had lost funds but had no records indicating to whom it had been paid. Some bank clerks asked me that day, ‘Why did you do it? Nobody knew that you had that money.’ My only answer was: ‘Because I am a Mormon’” (as quoted by Mario G. Echeverri, in “Venezuela,” Ensign, Feb. 1977, 30).

• How did the Pacheo family show honesty? How do you suppose the family felt as they were sealed in the temple?

• Invite class members to share some recent examples of honesty they have experienced or observed.

The Blessings of Honesty

[smac97]

26 minutes ago, Teancum said:

Quote

Oh brother.  Yes, it was to comply with the law.  There is nothing wrong with using legal means to maintain privacy.

Really? 

Yes, really.

26 minutes ago, Teancum said:

Then why was there a $5 million fine?  

Read the PSM article and Sam Brunson's article (including the comments).

Even Sam Brunson (!) now admits that the only difference between the Church being fully compliant verses non-compliant was the failure to vest "investment discretion" in the managers of the LLCs.  Sam from the comments:

Quote

The LLCs were filing 13Fs on whatever share of the portfolio was allocated to them. (The church just wanted to make sure the filings couldn’t be traced back to the church.) And honestly, that would have been legally fine, except that EPA kept management control at the EPA level.

And here:

Quote

Quote

1. Mike Sanders says:

   February 22, 2023 at 9:34 am

   Sam,

   “church leaders knew what they wanted, and that was to avoid mandated disclosure.”

   And apparently all they would have had to do differently in order to gain this desire without falling out of compliance would have been to devolve investment authority to the LLCs, right?

Quote

Sam Brunson says:

February 22, 2023 at 9:38 am

Mike, I think so. It still may have looked bad, but as far as I can see, it would have complied with the letter, and probably the spirit, of the law.

 

Thanks,

-Smac

[pogi]

3 minutes ago, bluebell said:

The idea that you can both agree and not agree at the same time, is such an example of why people struggle so much with legal talk and this topic.

It’s nonsensical in a lot of ways, and yet also legally binding.

They aren’t agreeing and disagreeing at the same time, rather they are neither agreeing nor disagreeing, in other words they are choosing to remain silent on the issue.  They are refusing to proclaim innocence or guilt in the accusations listed in the report, but are agreeing to pay the fine to avoid legal battles and potential judgment of guilt.

[Analytics]

2 hours ago, SteveO said:

That is a good analogy.  It also illustrates how benign the offense is.

Yea. A five million bucks is a slap on the wrist. If the Church would have done something to move the markets or otherwise hurt somebody, the sanction easily would have been in the hundreds of millions.

In one sense it is a small offense. In another, it was a very clear, deliberate, unethical, and unnecessary offense.

[mrmarklin]

13 minutes ago, The Nehor said:

That is not true. Settlements often involve a party not acknowledging they violated the law even when it is clear they violated the law. Not saying this is completely the case here but the generalization you make is untrue.

There's law and then there's regulation.  There's law and interpretation of law.  The SEC alleged that the Church misinterpreted the law, but this was never litigated.  The Church's legal counsel advised at all times AFAIK, that their interpretation of the law was valid.  Again, this was never litigated.

With out litigation, which will never happen, it is very unfair to believe or think or allege, that the Church violated the law.

[CV75]

2 minutes ago, Analytics said:

Yea. A five million bucks is a slap on the wrist. If the Church would have done something to move the markets or otherwise hurt somebody, the sanction easily would have been in the hundreds of millions.

In one sense it is a small offense. In another, it was a very clear, deliberate, unethical, and unnecessary offense.

[Ryan Dahle]

13 minutes ago, Tacenda said:

The church clearly needs to go back to the original statement and not the hidden one using ellipses. 

Why do you think the ellipses were used?

[Teancum]

1 hour ago, smac97 said:

What is your real name?  Your address?  Phone number?  Email address?  Where do you bank?  What are your assets?  What is your Social Security Number?  What are your logins and passwords for email provider, bank websites, etc.?

Smac.  Just stop it. This is a stupid argument. And you know it.

[The Nehor]

3 minutes ago, mrmarklin said:

There's law and then there's regulation.  There's law and interpretation of law.  The SEC alleged that the Church misinterpreted the law, but this was never litigated.  The Church's legal counsel advised at all times AFAIK, that their interpretation of the law was valid.  Again, this was never litigated.

With out litigation, which will never happen, it is very unfair to believe or think or allege, that the Church violated the law.

If you expect me to believe that everyone who has settled a case is not guilty or violating the law or ignoring regulations then:

LOL

If you expect me to think that it is unfair to believe or think anyone who settles violated the law then:

LOLOLOLOLOLOLOLOL

I do not believe that a settlement is a confession or an exoneration.

[Teancum]

12 minutes ago, CV75 said:

A vapid response. 

[smac97]

1 hour ago, SeekingUnderstanding said:

Quote

Please blaze the trail you think the Church ought to take.  What is your real name?  Your address?  Phone number?  Email address?  Where do you bank?  What are your assets?  What is your Social Security Number?  What are your logins and passwords for email provider, bank websites, etc.?

Is the church being asked to provide all that?

No.  That is rather my point.  

1 hour ago, SeekingUnderstanding said:

The equivalent to bank passwords? Really? And you wonder why no one but your cheerleaders take you seriously?

Ad hominem.  How surprising, or something.

1 hour ago, SeekingUnderstanding said:

There is nothing wrong with privacy.

And yet you are faulting - vilifying and excoriating, even - the Church for attempting to maintain some if its privacy.

Meanwhile, you harbor no such requirement for you to divulge your sensitive personal information.  The irony of that is . . . strong.

1 hour ago, SeekingUnderstanding said:

But Church leaders want to claim that the church isn’t wealthy. (https://www.churchofjesuschrist.org/study/general-conference/2006/04/our-sacred-priesthood-trust?lang=eng).

I'm not sure how much EPA had as "Assets Under Management" when Pres. Monson made this comment in 2006.  Do you?

Moreover, let's look at the context of Pres. Monson's remarks:

Quote

I have experienced many opportunities. One occurred 21 years ago, prior to the time when the German Democratic Republic—or East Germany, as it was more commonly known—was freed from Communist rule. I was visiting with the East German state secretary, Minister Gysi. At that time our temple at Freiberg, in East Germany, was under construction, along with two or three meetinghouses. Minister Gysi and I visited on a number of subjects, including our worldwide building program. He then asked, “Why is your church so wealthy that you can afford to build buildings in our country and throughout the world? How do you get your money?”

I answered that the Church is not wealthy but that we follow the ancient biblical principle of tithing, which principle is reemphasized in our modern scripture. I explained also that our Church has no paid ministry and indicated that these were two reasons why we were able to build the buildings then under way, including the beautiful temple at Freiberg.

Minister Gysi was most impressed with the information I presented, and I was very grateful I was able to answer his questions.

So Pres. Monson was not speaking of the Church's financial condition in 2006, but 21 years prior to that, in 1985.  EPA wasn't even a thing back then.

Do you know how much "wealth" the Church had in 1985?

1 hour ago, SeekingUnderstanding said:

Church leaders want to say “we are not a wealthy people” (https://news-zw.churchofjesuschrist.org/article/elder-andersen-meets-with-zimbabwes-vice-president-mohadi-pledges-support).

Hoo, boy.  Going rather far afield, arncha?

From your link:

Quote

Elder Andersen said the significance of the meeting with Vice President Mohadi was to “express to him our desire to help improve Zimbabwe.” He noted that Vice President Mohadi had made a specific request for support with the development of clean-water wells in more remote areas of Zimbabwe.

“We want to help in every way we can,” said Elder Andersen. “We are not a wealthy people but we are good people, and we share what we have,” he added.

The Church has 16 million members, and vast ongoing financial obligations.  Moreover, the Church's "wealth" is held in trust, both for the benefit of the Latter-day Saints and their neighbors - as evidenced by, inter alia, the Church helping fund clean-water wells in remote areas of Zimbabwe.

1 hour ago, SeekingUnderstanding said:

Meanwhile they are doing everything they can to obscure their vast wealth. 

"Their vast wealth?"  Who is "their?"

Also, are you familiar with holding assets or money "in trust?"  

1 hour ago, SeekingUnderstanding said:

Elder Ballard says:  “Just trust us, wherever you are in the world, and you share this message with anyone else who raises the question about the Church not being transparent. We’re as transparent as we know how to be in telling the truth. We have to do that; that’s the Lord’s way.”

Transparent organizations don’t create 13 shell companies to make sure no one finds out how much they’re worth.

"Transparent" has all sorts of eye-of-the-beholder connotations to it.

1 hour ago, SeekingUnderstanding said:

Is transparent honesty the lords way or not? 

https://www.thechurchnews.com/2017/11/20/23213151/personal-revelation-homosexuality-and-dating-among-topics-discussed-in-face-to-face-broadcast

I think the Church is overwhelmingly good and decent.  And honest.  

Thanks,

-Smac

Edited February 22, 2023 by smac97

[ttribe]

29 minutes ago, bluebell said:

The idea that you can both agree and not agree at the same time, is such an example of why people struggle so much with legal talk and this topic.

It’s nonsensical in a lot of ways, and yet also legally binding.

 

19 minutes ago, pogi said:

They aren’t agreeing and disagreeing at the same time, rather they are neither agreeing nor disagreeing, in other words they are choosing to remain silent on the issue.  They are refusing to proclaim innocence or guilt in the accusations listed in the report, but are agreeing to pay the fine to avoid legal battles and potential judgment of guilt.

Pogi is correct. To put it in TV Cop Show terms, they consented to the imposition of the terms of the settlement (e.g. fines, cease-and-desist), but they exercised their "right to remain silent" (so to speak).

Edited February 22, 2023 by ttribe

[smac97]

8 minutes ago, Teancum said:

Quote

What is your real name?  Your address?  Phone number?  Email address?  Where do you bank?  What are your assets?  What is your Social Security Number?  What are your logins and passwords for email provider, bank websites, etc.?

Smac.  Just stop it. This is a stupid argument. And you know it.

As soon as you and yours stop fabricating arbitrary and unreasonable standards to impose on the Church - apparently for the sole purpose of raking the Church across the coals for not complying with your expectations about what it ought to do - I'll stop pointing out the brazen irony of your position relative to a private party's obligation to publicly disclose its private and sensitive information.

Until then...

Thanks,

-Smac

[OGHoosier]

1 minute ago, smac97 said:

 

Even Sam Brunson (!) now admits that the only difference between the Church being fully compliant verses non-compliant was the failure to vest "investment discretion" in the managers of the LLCs.  Sam from the comments:

I'll amend this further: "practical" investment discretion.

On paper, the Business Managers had investment discretion, which I think was the angle that EPA's lawyers took. Of course, EPA governed the whole set of securities as a unity with the Business Managers as rubberstamps. The thing is, the law states that "investment discretion" allows the Business Manager to outsource the actual responsibility for investing to somebody else:

Quote

An institutional investment manager exercises investment discretion if: (i) the manager has the power to determine which securities are bought or sold for the account(s) under management; or (ii) the manager makes decisions about which securities are bought or sold for the account(s), even though someone else is responsible for the investment decisions.

So I think the Ensign Peak lawyers banked on the Business Managers having on-paper "investment discretion" but leaving the actual decisions to EPA as being compliant with the law. The SEC didn't agree, but that is very much a matter for statutory interpretation as what I just quoted is the extent of the law as to "investment discretion."

The hilarious thing about it is that if EPA had just released one of their employees, hired him on as the Business Manager, and then made a spit-and-a-handshake agreement that said Business Manager would do exactly the same thing as they did...there would be no legal problem. 

Now, my next question is - is this a common tactic on the Street? Because if it is, I think that sheds some light on the decision-making process here. Different industries have different standards for what counts as "legit" and not within the industry, standards which may look opaque to outsiders. If this sort of wink-and-a-nod approach to satellite LLC-use happens a lot on the Street, then it makes sense why EPA would think it was normal, even though it doesn't look that way for us. 

[smac97]

21 minutes ago, Analytics said:

Quote

By the express terms of the SEC Order, the Church has neither admitted nor denied any of the allegations in the Order.

Yet you claim some (all?) of the things the SEC determined to be facts are disputed.

The Church has neither admitted nor denied any of the factual allegations in the SEC Order.

And none of those factual allegations have been accorded adjudicatory review, which would include Due Process, evidentiary requirements, and so on.

21 minutes ago, Analytics said:

Which of their “facts” are disputed? 

Which of the allegations, you mean?

Thanks,

-Smac