Church of Jesus Christ of Latter-day Saints Agrees to Pay Penalties for Failing to Disclose Stock Holdings

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• The Church of Jesus Christ of Latter-day Saints and an affiliated investment arm have agreed to pay penalties and adhere to standard investment-reporting practices.
• The SEC charged Ensign Peak with failing to file required forms that would have fully and properly disclosed the church’s stock holdings.
• The church was concerned that disclosure of its portfolio would lead to “negative consequences.”
• The SEC requires the use of 13F forms on portfolios worth $100 million or more.
• The SEC became aware of the issue following allegations raised by a whistleblower.

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The Church of Jesus Christ of Latter-day Saints and its Affiliated Investment Arm Agree to Pay Penalties

The Church of Jesus Christ of Latter-day Saints and an affiliated investment arm have agreed to pay penalties and adhere to standard investment-reporting practices after federal regulators accused them of failing to properly disclose the church’s stock-market investments worth billions of dollars and other details.

Ensign Peak Advisors, the nonprofit investment firm, has agreed to pay a $4 million penalty and the church has agreed to pay $1 million.

The church said it will pay the money out of investment returns on a portfolio that some have estimated as worth more than $100 billion, including stocks, bonds, timberland, holdings in hedge funds and other investments.

SEC Investigation Findings

The SEC charged Ensign Peak with failing to file required forms that would have fully and properly disclosed the church’s stock holdings.

Instead, the investment firm submitted paperwork for shell companies that obscured the church’s wealth and misstated Ensign Peak’s control over the church’s investment decisions.

From 1997 through 2019, the SEC said Ensign Peak failed to file scores of 13F forms on which investment managers are required to disclose what securities they oversee and how much they are worth.

The church was concerned that disclosure of its portfolio, which by 2018 had grown to $32 billion, would lead to “negative consequences.”

To obscure the size and other characteristics of the portfolio, with the knowledge and approval of church officials, Ensign Peak created 13 shell limited liability companies and filed 13Fs in their names.

SEC Requirements and Public Access to Investment Documents

The latest 13F filed by Ensign Peak for the quarter that ended Dec. 31 disclosed nearly 1,800 stock-market positions worth $44.4 billion.

The SEC requires the use of 13F forms on portfolios worth $100 million or more.

These and other investment documents are available for public viewing on the SEC’s Edgar database at sec.gov/edgar.

The SEC became aware of the issue following allegations raised by a whistleblower.

The requirement to file timely and accurate 13Fs applies to all institutional investment managers, including non-profit and charitable organizations.