Mormon church and adviser pay SEC $5M to settle charges over obscured investments

The Church of Jesus Christ of Latter-Day Saints and its investment manager have settled with the Securities and Exchange Commission and agreed to pay fines after being accused of obscuring billions of dollars in investment holdings.

The SEC said in an announcement on Tuesday that for more than two decades, the Mormon church’s investment adviser, Ensign Peak Advisors, failed to file certain forms that are required to disclose the value of certain securities it manages.

By 2018, the obscured funds were worth $32 billion. To obscure the holdings, Ensign Peak Advisors created more than a dozen shell companies with locations across the United States and filed the forms in question under the names of those LLCs rather than that of Ensign Peak Advisors. The SEC said this was all done with the church’s knowledge.


“We allege that the LDS Church’s investment manager, with the Church’s knowledge, went to great lengths to avoid disclosing the Church’s investments, depriving the Commission and the investing public of accurate market information,” said Gurbir Grewal, director of the SEC’s enforcement division.

“The requirement to file timely and accurate information on Forms 13F applies to all institutional investment managers, including non-profit and charitable organizations,” he added.

As part of the settlement, Ensign Peak Advisors agreed to pay a fine of $4 million, while the Church of Jesus Christ of Latter-Day Saints will pay a $1 million penalty.

In a statement provided to the Washington Examiner, the church said that it “regrets[s] mistakes made.” The church said that since 2000, Ensign Peak Advisors relied on legal counsel regarding how to comply with reporting requirements while balancing privacy. As a result, the separate shell companies filed the required forms individually rather than Ensign Peak Advisors doing so in a single aggregated filing.


“In June 2019, the SEC first expressed concern about Ensign Peak’s reporting approach. Ensign Peak adjusted its approach and began filing a single aggregated report. Since that time, 13 quarterly reports have been filed in full accordance with SEC requirements,” the statement added.

“This settlement relates to how the forms were filed previously. Ensign Peak and the Church have cooperated with the government over a period of time as we sought resolution,” according to the church.