A Friends Analysis of LDS Church Finances


A friend of mine, Spencer Coulter, Recently published a commentary on Facebook regarding how the church handles it finances and investments. This is honestly never been something I have personally thought about, nor do I have any personal issues about how the finances are handled within the church. His assessment however certainly raising some questions about the current practices and in relation to the churches history when it comes to financial matters and I just wanted to share what he had to say. I may follow up with a blog piece of my own on this subject at some future date. As for myself, I don’t know enough about it to have a opinion one way or the other at this point. Considering however that I give 10% of my income to the church as tithing, I should probably take some time to understand how that revenue is used.

There are many who will say that questioning church leaders and practices will lead to apostasy. We have been told that we are not to do that as it could constitute speaking ill of the lords anointed. My feeling on this, again I may need to write my own post on this subject, is that if the church and its leadership is operating in accordance with the law of God then seeking to learn how they operate and how the church is manage via questioning everything that is done within the church, then this should only lead to strengthen testimony and faith, not weakened or apostasy.

I appreciate the courage of my friend to ask these tough questions no matter how un-comfortable it makes people.


I can confirm the information in this picture is pretty much accurate. I know this subject may seem controversial and ruffle the feathers of some members, (Which is understandable as most members have not been told about any of this) but it’s more or less just discernible facts about how the church has acted in the observable public sector as a legal entity over the past century or so. I’ve done a lot of fascinating research into this as I’m looking to understand the organization in all capacities as to how and why it ticks, and my goal is to be actually rather neutral and as objective as possible in studying these matters, so by no means am I insinuating anyone to draw any conclusions.

(I’d just like to mention that I’m standing on the shoulder of giants when I say any of this. Anyone who’s looking to research these topics in depth I would recommend reading the book “Mormonism in Transition: A History of the Latter-day Saints 1890-1930” by LDS Historian Thomas G. Alexander, and “The Book of Mammon: A book about a book about the corporation that owns the Mormons” by cultural anthropologist Daymon Smith. Both are believing members, by the way, and Daymon Smith worked at Church Headquarters, employed for his talents.)

From what I understand, it all began in the 1890’s and early 20th century when the Church was majorly in debt to the United States after building the Salt Lake temple. Back then, members would often pay their tithing “in kind” meaning instead of money, they could pay tithing in anything of equal value. Now the problem with getting eggs as tithing when you’re a legal entity is that you can’t put those eggs in a bank account and accrue interest from and invest them. The bishops back then would take these tithing offerings and either sell them off, or redistribute them among the needy in the Church. Facing the matter of losing Church property to the Church’s creditors, it was also during this time that Lorenzo Snow introduced the more temporal policy of the members paying tithing via money instead of kind, promising the windows of heaven would open. Well, the windows of heaven did indeed open and pure liquid capital poured into the Church and the Church very quickly found its way out of debt, but the institution of paying tithing via gross liquidity remained.

The Church was soon faced with another problem. As a legal entity owning property, the Church was incorporated in 1890 with the President of the Church as the trustee in trust, or sole stewart over the Church’s legal property. The problem with this is it creates legal complexities of succession when the president passes away and leaves the Church at risk of having their property possessed by the State after the Trustee has passed on. In 1916 the Presiding bishopric of the Church took a page out of the Catholic playbook and employed the legal strategy of creating what’s called a Corporation Sole. This makes it so that after the trustee has passed on, the Church retains the property of the stewart and the “sole” successor becomes the new Corporation Sole. Makes sense, right? Well, the problem with “The Corporation of the Presiding Bishop” being the only Corporation Sole in the conglomerate of the Church is that after the President passes away, the Corporation of the Presiding Bishop could technically splinter from the corporate side of the Church and take all property under their name with them; SO in 1923 the corporation sole “The Corporation of the President of the Church of Jesus Christ of Latter-Day Saints” was created and all other Corporation Soles became subsidiaries of it.

One of the most surprising things I learned on my end from all of this research is that, technically and legally speaking, there exists no such entity as The Church of Jesus of Jesus Christ of Latter-Day Saints. It is actually a TRADEMARK of intellectual property owned by The Corporation of the President of the Church of Jesus Christ of Latter-Day Saints. Indeed, the Church does not exist by legal definition as a religious organization in the U.S whatsoever. Rather, it is registered as a corporation with 501(c)(3) status as a non-profit, tax exempt organization. Bear in mind, I’m speaking strictly in legal terms, and I am of no necessity impugning that the Church does not behave in manners becoming of something representing a “Church.” However, understanding these corporate underpinnings gives us many interesting insights into how and why the Church operates. It is indeed interesting to note the most significant changes in policy in Church history, polygamy and blacks and the priesthood, came both at times that the Church’s non-profit status was being threatened.

The corporate infrastructure of the institution has also profoundly influenced and affected the evolution of the Church’s financial strategies, especially concerning tithing. Just as there was once a time where you could pay your tithing “in kind,” there was also once a time that the Church hearkened to D&C 26 where it states that ALL things were to be done by common consent of the members. This included financial matters. Indeed, for the first 126 years of the Church’s existence, the brethren honored this and gave at each general conference a detailed accounting of where the member’s sacred tithing donations were being allocated that the members would then consent to, for indeed D&C 104:71 states that all money in the treasury shall “not be used, or taken out of the treasury, only by voice and common consent.” President David O. McKay was the last prophet to do this. During the majority of the 1950’s, the Church was doing well financially. The Church auditors at General conference at the end of 1950 reported, “The Church is in strong financial position and free from debt.” By the end of 1957, the Church was doing so well it had a surplus of 70 million sitting in Zion’s National Bank and was completely financially independent.

The first embarrassment came the following year when the Church’s real estate division recklessly acquired property landing the Church again in debt to the tune of 8 million. For the first time in Church history, the Brethren did not report this in the next General conference session. The subsequent years saw their deficit double and by 1963 the Church was dangerously close to defaulting to bankruptcy. This all changed when Canadian investor and businessman N. Eldon Tanner was appointed as Chief Financial Officer for the Church. Up until then, the Church had invested in things like ranches, education, sugar companies, railroads, store houses, and public utility services… things that can typically be described for the benefit of improving society and offer charitable services for the betterment of mankind.

Now under the leadership of Eldon Tanner, the Church was found investing in unorthodox ventures such as banking institutions, energy companies, insurance companies, oil companies such as Exxon, Standard Oil, and Phillips Petroleum. Tanner even bought a million dollars of stock in the Los Angeles times and 4 years later flipped it for 4 million.

The second embarrassment came not from the Church being in debt but rather from getting rich… REALLY rich off of these kinds of investments. How do you relay to your members the means by which you were bailed out from financial peril was through, what some might call, being in bed with Babylon and investing in mammon for a Kingdom that is supposedly “not of this world?”

Daymon Smith is hilariously apt when he says, “The way that Mammon works is to make it seem like it makes perfect sense to play along, and that we can do it to our advantage; that we can make a deal with, as it were, the devil.
And I’m not saying that rich people are the devil or that Citibank is the devil. But the things that don’t have an interest in building up the Kingdom of God, I believe are, of course, building up another kind of kingdom. And so the question for me is whether we can actually make these kinds of deals, and in fact whether we NEED to be making these kinds of deals.

If Jesus tells us to consider the lilies of the field, maybe we ought to be considering the lilies of the field rather than investing our funds in a sort of lily-gilding operation that is going to yield an 8% profit for the next fifty years.

In other words, is it right to build a foundation of security that is tied to the global economy? Or should we be trying to do something which is a little more in line with what I read Joseph Smith was trying to do, which is create an order of people who are independent as much as possible from the operations of the world because the world is fallen? It’s in a state of sin, and for us to try to profit from the sin is a very dangerous proposition from my perspective.”

One such example that comes to mind of what Daymon is talking about is the fact that the Church owned a stake (which has since been divested) in Zion’s First National Bank, an institution that as recent as a few years back was implicated in the laundering of billions of dollars of illegal drug cartel money, and has been the recipient in billions of dollars in taxpayer bailout money. Nonetheless, that hasn’t stopped Thomas S. Monson from performing a dedicatory prayer for a newly opened branch of the bank. You know, kinda like how they do at stake centers and temples? …except it’s a bank.

Since that time, the Church’s modus operandi with tithing rather than allocating it as a resource as was traditional has been to invest it as principal from which interest is accrued. That interest is then diverted into their for-profit ventures and corporate interests such as their real estate companies (Owned by The Corporation of the Presiding Bishop), Media outlets, Deseret Book and Deseret Industries, to name a few examples.

This explains some of the seemingly more bizarre, fully Church funded ventures such as the blatant City Creek Shopping Center (full of advertising and marketing not consistent with the lifestyles and values the Church promotes), a 1.5 billion dollar mega mall with a roughly 70 million dollar payout to the architect regardless of the Mall’s success, fully paid out by the Church, PLUS the surrounding area to be developed by the Church’s real estate firm. In total, this is costing upwards of 5 billion dollars. The Church has been a little coy and misleading in rushing to say that none of these investments come directly from tithing money, but it seems to be fairly apparent at this point that everything the Church has done is from investing the interest where tithing money is the principal. Everything comes from tithing.

I guess my question in all of this really is if what the Church is doing with its donations and contributions is TRULY reflecting and representing our highest values, ideals, and interests as a religious collective that’s supposed to have Christ at the center of our beliefs. With the brethren severing their financial accountabilities to their members and a well groomed trans-generational thought culture that seems to suggest we smile and say, “Yes, Please!” to everything the Brethren and the Church does, I certainly have my concerns. But all I really wanted to do here was provide a picture of context as to some of the factors that influence how and why the Church does what it does. By no means was this all supposed to be comprehensive. I just think it’s vital if you want to be an intelligent, thinking, independent member of this organization, it’s important to understand all aspects, in all capacities the nature of what I would call this: undoubtedly a well oiled machine. After all, Jesus taught his disciples, “By their fruits ye shall know them.”

Let me know what you think in the comments below.

By Andrew McLean Posted in Orginals