Mormon Church accused of stockpiling billions, avoiding taxes

Article Image

The Church of Jesus Christ of Latter-day Saints, commonly...

Posted: Dec 18, 2019 10:02 AM
Updated: Dec 18, 2019 9:45 PM

The Church of Jesus Christ of Latter-day Saints, commonly referred to as the Mormon Church, responded Tuesday to a recently filed whistleblower complaint that accuses the church of stockpiling $100 billion in accounts intended for charitable works, misleading members and avoiding taxes.

A whistleblower alleges that billions of dollars collected in tithes -- mandatory donations by members -- was invested in an investment arm of the church, Ensign Peak Advisors, but in 22 years, has not been distributed to charitable causes in accordance with IRS rules, according to the complaint filed with the IRS.

'Claims being currently circulated are based on a narrow perspective and limited information,' the LDS Church told CNN in a statement. '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.'

The complaint was first reported by the Washington Post. The whistleblower, David Nielsen, is a Mormon who worked for the church until September, his brother, Lars Nielsen, told CNN. David Nielsen is a former senior portfolio manager at Ensign Peak Advisors, his brother said.

The complaint was prepared by the brothers and filed with the IRS in mid-November, according to Lars Nielsen.

Under IRS rules, whistleblowers can be awarded up to 30 percent of any taxes and penalties collected.

'We began this effort before we knew the IRS whistleblower program existed and he asked me to work with him,' Lars Nielsen said Wednesday.

David Nielsen wants the IRS to strip the Mormon church of its tax exempt status, according to the complaint.

An IRS spokesman declined to comment citing federal law prohibiting the agency from discussing any specific case. Ensign Peak Advisors declined to comment.

Sam Brunson, a professor of nonprofit tax law at Chicago's Loyola University who is a member of the LDS church, said under Ensign's Articles of Incorporation, 'it is both a supporting organization,' which means it has to make charitable donations 'commensurate in scope' to its funds, and an 'integrated auxiliary,' which means it might not have to. An integrated auxiliary organization can legally sidestep paying taxes by being a non-profit.

'My guess is that the IRS will probably do nothing' and even if it does, 'chances are very small we will find out,' he said.

Brunson told CNN that 'there is some hurt and questioning' among his friends and church members who worry about those who can't really afford the 10% tithing to a church that allegedly has such a large nest egg.

And he hopes that the whistleblower's complaint will spark some changes. 'Members of the church aren't shareholders, but stakeholders, and there's something good about transparency,' he said.

The church added in its statement that most of the donated money was used for education, humanitarian work, meeting houses, missionary efforts and temples. Other money was saved.

'Over many years, a portion is methodically safeguarded through wise financial management and the building of a prudent reserve for the future,' the church said in the statement.

In the statement the church made no mention of allegedly accumulating $100 billion, but did say, 'All Church funds exist for no other reason than to support the Church's divinely appointed mission.'

Lars Nielsen told CNN that his brother reveres the people he worked with and said they might have made mistakes.

He said the church hierarchy may not have understood what was demanded under the law.

'David and I are very mindful that the money that could be recovered is money that came from the tithe, from people we care about. This is special money,' he said.

Indiana Coronavirus Cases

(Widget updates once daily at 8 p.m. ET)

Confirmed Cases: 33068

Reported Deaths: 2068
CountyConfirmedDeaths
Marion9524558
Lake3494175
Cass15897
Allen141966
St. Joseph122134
Hendricks114268
Hamilton113292
Elkhart110128
Johnson1092106
Madison58459
Porter50522
Bartholomew49034
Clark47941
LaPorte42022
Tippecanoe3823
Howard37824
Delaware37636
Jackson3721
Shelby36822
Hancock32727
Floyd31739
Boone30535
Morgan27724
Vanderburgh2592
Montgomery23417
White2308
Decatur22431
Clinton2221
Noble20421
Grant19721
Dubois1903
Harrison18921
Henry16910
Greene16824
Monroe16512
Warrick16528
Dearborn16521
Vigo1538
Lawrence15223
Miami1401
Putnam1357
Jennings1294
Orange12422
Scott1203
Ripley1106
Franklin1098
Kosciusko1011
Carroll933
Daviess8416
Steuben812
Marshall801
Newton7610
Wayne756
Fayette747
Wabash742
LaGrange682
Jasper661
Washington511
Jay490
Fulton471
Clay461
Rush452
Randolph453
Jefferson431
Pulaski410
Whitley383
Owen351
Sullivan341
DeKalb331
Brown331
Starke323
Perry280
Wells270
Benton260
Huntington262
Knox250
Tipton241
Crawford230
Blackford222
Parke190
Spencer191
Switzerland190
Fountain182
Posey160
Gibson142
Adams131
Ohio130
Warren121
Vermillion100
Martin90
Union80
Pike60
Unassigned0161

Illinois Coronavirus Cases

(Widget updates once daily at 7 p.m. CT)

Confirmed Cases: 115833

Reported Deaths: 5186
CountyConfirmedDeaths
Cook753063519
Lake7933281
DuPage7460350
Kane6083167
Will5356268
Winnebago209153
McHenry148870
St. Clair105077
Kankakee83644
Kendall75119
Rock Island63923
Champaign5957
Madison54557
Boone42416
DeKalb3704
Sangamon34328
Randolph2674
Jackson25610
McLean21613
Ogle2002
Stephenson1992
Macon19219
Peoria1918
Out of IL1831
Clinton18017
Union1519
Unassigned1490
LaSalle14113
Whiteside13412
Iroquois1314
Coles12313
Warren1130
Jefferson10116
Knox960
Grundy952
Monroe9311
McDonough847
Lee791
Tazewell704
Cass690
Henry670
Williamson602
Marion500
Jasper457
Adams441
Macoupin442
Perry410
Pulaski410
Montgomery391
Vermilion381
Morgan341
Christian334
Jo Daviess320
Livingston322
Douglas260
Fayette203
Ford201
Jersey201
Menard190
Mason180
Washington180
Woodford182
Hancock160
Mercer160
Shelby161
Bureau151
Carroll142
Bond121
Franklin120
Piatt120
Schuyler120
Clark110
Crawford110
Fulton110
Brown100
Cumberland100
Logan100
Moultrie100
Wayne91
Alexander80
Henderson80
Johnson70
Massac70
Saline70
Effingham61
Greene50
Marshall50
De Witt40
Lawrence40
Richland30
Stark30
Clay20
Edwards20
Gallatin20
Hamilton20
Wabash20
White20
Calhoun10
Hardin10
Pike10
Pope10
Putnam10
Edgar00
Terre Haute
Overcast
66° wxIcon
Hi: 77° Lo: 55°
Feels Like: 66°
Robinson
Overcast
64° wxIcon
Hi: 76° Lo: 54°
Feels Like: 64°
Indianapolis
Overcast
64° wxIcon
Hi: 75° Lo: 55°
Feels Like: 64°
Rockville
Overcast
62° wxIcon
Hi: 75° Lo: 54°
Feels Like: 62°
Casey
Scattered Clouds
64° wxIcon
Hi: 77° Lo: 54°
Feels Like: 64°
Brazil
Overcast
66° wxIcon
Hi: 75° Lo: 54°
Feels Like: 66°
Marshall
Overcast
66° wxIcon
Hi: 77° Lo: 54°
Feels Like: 66°
Showers Early, Cooler
WTHI Planner
WTHI Temps
WTHI Radar

WTHI Events