Mormon church has $100bn ‘clandestine hedge fund’, says whistleblower
15 May 2023 ( The Guardian )
A former investment manager for the Church of Jesus Christ of Latter-day Saints says that the organization stockpiled more than $100bn in funding intended for charity work but never spent it on such projects.
“It was really a clandestine hedge fund,” David A Nielsen said during an interview with CBS’s 60 Minutes. “Once the money went in, it didn’t go out.”
A former investment manager for the Church of Jesus Christ of Latter-day Saints says that the organization stockpiled more than $100bn in funding intended for charity work but never spent it on such projects.
“It was really a clandestine hedge fund,” David A Nielsen said during an interview with CBS’s 60 Minutes. “Once the money went in, it didn’t go out.”
Nielsen, a devout Mormon himself, was first recruited to work for Ensign Peak while working on Wall Street.
Nielsen, a devout Mormon himself, was first recruited to work for Ensign Peak while working on Wall Street.
Nielsen said that during his time with Ensign Peak, he observed the church’s investment firm “[masquerading] as a charity”, dodging what would be billions of dollars in taxes by falsifying records, and generally misleading other believers of the Mormon faith.
Every year, the Church of Jesus Christ of Latter-day Saints collected an estimated $7bn from its 17 million members through a practice known as tithing, in which members give about 10% of their income to the religious organization.
About $1bn of the collected money was placed into a reserve fund at Ensign Peak – which is registered as a non-profit – and invested, with profits growing tax-free.
Created in 1997, the reserve fund has ballooned to more than $100bn, which is nearly twice the size of Harvard’s endowment, Nielsen said.
Nielsen’s complaint was later forwarded to the Securities and Exchange Commission, which said the church took great lengths to hide the size of its investments through shell companies and fake office addresses, the Washington Post reported.Nielsen’s complaint was later forwarded to the Securities and Exchange Commission, which said the church took great lengths to hide the size of its investments through shell companies and fake office addresses, the Washington Post reported.
The church paid $5m to resolve its SEC case in February.
The Mormon church official W Christopher Waddell, who oversees the organization’s financial, real estate, investment and charitable operations as the first counselor in the presiding bishopric, vehemently denied Nielsen’s accusations.
“Flat-out wrong,” said Waddell, who added that Ensign Peak acted as “the church’s treasury” and provided resources for its operation.
Nielsen’s interview with 60 Minutes is one of the first times he has given public comment on the report.
“We gave the IRS and the SEC all the professional courtesy,” Nielsen said. “This is just too important to fall through the cracks.”
But experts say that the likelihood of the IRS investigating Nielsen’s claims is low.
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