SEC Charges The Church of Jesus Christ of Latter-day Saints for Failing to Disclose Investments
Photo Credit: Church of Jesus Christ of Latter Day Saints
Written by: Sam Orlando
Salt Lake City, UT: The Securities and Exchange Commission (SEC) has charged Ensign Peak Advisers Inc. and The Church of Jesus Christ of Latter-day Saints for failing to file forms that disclosed the church’s equity investments. The SEC also accused the church of causing these violations.
Ensign Peak Advisers, a non-profit entity, managed the church’s investments from 1997 through 2019, during which time it failed to file Forms 13F. The church had concerns that disclosing its portfolio, which had grown to approximately $32 billion by 2018, would lead to negative consequences. To conceal the amount of the church’s portfolio, Ensign Peak created 13 shell LLCs and filed forms in the names of these LLCs instead of its own name. Ensign Peak directed nominee "business managers" to sign the commission filings, and the LLCs’ Forms 13F misrepresented that they had sole investment and voting discretion over the securities.
The SEC found that Ensign Peak retained control over all investment and voting decisions, and that the church was aware of and approved Ensign Peak’s use of the shell LLCs. Ensign Peak agreed to pay a $4 million penalty, while the church agreed to pay a $1 million penalty to settle the charges.
“The requirement to file timely and accurate information on Forms 13F applies to all institutional investment managers, including non-profit and charitable organizations,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement.
The SEC’s investigation was conducted by Paul Feindt under the supervision of Tracy Combs and Tanya Beard of the Salt Lake Regional Office and Laura Metcalfe of the Denver Regional Office.