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SEC charges the Church of Jesus Christ of Latter-Day Saints

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Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#121

Post by CosmicShadow »

pwinnski wrote: post #51
CosmicShadow wrote: post #44

Earlier quoted context omitted.

But what kind of staff or funding does it take to say literally different words out of your mouth like, you are fined $5B instead of $5MM? I can do that for free, especially if they are already at the point where they are making the charge. Every fine should be devastating so that they either barely survive or die, and every other company shits themselves for life and we solve the problem.

Hence the phrase "regulatory capture" which describes a system in which unelected bureaucrats are not given life-and-death power over companies, but the people who set the rules are wholly captured by the regulated companies so the rules are made weak.

Thanks for the definition

Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#123

Post by gowld »

shadowgovt wrote: post #60
tptacek wrote: post #52

Earlier quoted context omitted.

Why would the fine be higher? Presumably it's proportionate to the harm caused, not by the size of the fund.

It's actually a settlement, not a fine, which is probably pinned closer to the "This is the amount we think we'd have to pay lawyers to argue the case" value than the "This is how much we would owe if we were found guilty of breaking the law" value.

More accurately: "This is the amount we think we'd have to pay lawyers to scuttle the case"

Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#124

Post by habosa »

boeingUH60 wrote: post #20

Here's a related random fact: Fidelity, the well-known investment firm, runs donor-advised charitable funds for rich clients that in aggregate constitute America's charity [1]. The three largest recipients from those funds? Harvard University, Stanford University, and the Mormon Church...organizations that aren't in any way hurting for money. I guess people fund what they are familiar with and for prestige. 1- https:…

I get what you're trying to say but this comment made it seem like Fidelity (or Fidelity Charitable) was somehow funneling money to those organizations. To clarify for others reading: that's not the case. Fidelity's customers are using Donor Advised Funds because they're an efficient way to tax plan around charitable donations and those same customers are choosing where the funds go (hence: Donor Advised) and they're choosing Harvard, Stanford, and LDS.

Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#125

Post by bbatha »

skissane wrote: post #65
sjsdaiuasgdia wrote: post #9

Earlier quoted context omitted.

Better to just get rid of the tax exempt status for religious organizations altogether. They can operate like any other non-profit and be subject to that set of rules, or they can be a regular corporation and be subject to a different set of rules. The religious exemption is a big regulatory gap that doesn't need to exist.

The details vary from country to country, of course, but some of the tax exemptions which religious groups get are actually just standard exemptions available to all non-profits, or all charities. English law has long defined "advancing religion" as a "charitable purpose". The Charitable Uses Act of 1601 (aka the Statute of Elizabeth) included "the repair of... churches" as a charitable purpose, and later case law to…

> They can operate like any other non-profit and be subject to that set of rules, or they can be a regular corporation and be subject to a different set of rules.

Its pretty clear that OP just wants them to register as 501c3's or similar not force them to pay taxes in general

Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#126

Post by tptacek »

Sebb767 wrote: post #116
tptacek wrote: post #70

Earlier quoted context omitted.

Right, either way, I'm looking for an intuition about how much an infraction like this should cost. Presumably, the settlement also includes the LDS church's consent to start filing reliable 13F's. I'm not saying I think 5MM is the right number; I'm just saying I have no intuition for what the number should be, and the rationale I see on the thread seems to be "they're big". If I get pulled over in a Bentley with an…

> If I get pulled over in a Bentley with an expired sticker, I pay the same price as someone in a Kia. The fine should scale with the size of the infraction. If you sticker expires on your car, the infraction is the same severity, no matter the car [0]. ~Hiding a few million vs. hiding a few billion in taxes is a whole different level.~ EDIT: They just hid it for information purposes. Not to avoid tax. Therefore, thi…

Right, I agree. But they didn't hide millions from taxes. They availed themselves of more privacy than the SEC allows for fund managers. If we can articulate the manner in which that inflicted more than 5MM in harm, I think we have a strong case for the fine being too low. But I have no intuition for how to work out the harm these bad filings caused. Do you?

As for deterrence: it appears as if the SEC successfully deterred Ensign Peak from doing this, right? They hadn't filed properly since 1997, but the enforcement action is just a couple years old.

Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#127

Post by GlenTheMachine »

ESTheComposer wrote: post #94
lvl102 wrote: post #37

Earlier quoted context omitted.

I would go one step further and say that donations to religious organizations should not be tax deductible. They are not charities in 99% of the cases.

Citation for that 99% figure? If it's anecdotal then I will give you my anecdote as a non Christian that I see 99% of churches doing charitable works.

As a member of the LDS church, the church absolutely does charitable work.

The problem is that it doesn't do $32B worth of charitable work. Or anything close to it. And that, I think, is the problem.

Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#128

Post by wrycoder »

outworlder wrote: post #73

There's a section in Bloomberg's Matt Levine column about this. That's useful to understand what they were doing with the shell companies. https://www.bloomberg.com/opinion/articles/2023-02-21/amc-ap...

Paywall, not resolved by archive.org

Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#129

Post by tptacek »

shadowgovt wrote: post #99
tptacek wrote: post #70

Earlier quoted context omitted.

Right, either way, I'm looking for an intuition about how much an infraction like this should cost. Presumably, the settlement also includes the LDS church's consent to start filing reliable 13F's. I'm not saying I think 5MM is the right number; I'm just saying I have no intuition for what the number should be, and the rationale I see on the thread seems to be "they're big". If I get pulled over in a Bentley with an…

> If I get pulled over in a Bentley with an expired sticker, I pay the same price as someone in a Kia. That meets an intuitive definition of fairness, but the realpolitik story there is you don't have a lot of power to make trouble for the municipality by tying them up in court for a half-decade arguing how your Bentley was actually operated legally because the definitions of "sticker" and "driving" and "expired" are…

Yeah, that didn't happen. The SEC brought this enforcement action in 2019.

Re: SEC charges the Church of Jesus Christ of Latter-Day Saints

#130

Post by dbrueck »

shartshooter wrote: post #55

One question I had while reading this: - Should non-profits be allowed to "invest" their tax-exempt donations? It seems that non-profits should obtain their funding through grants or donations. Investing, on the other hand, seems like the opposite of "non-profit" As a personal aside, I've recently been introduced to a few folks who seem to be doing extraordinarily well financially. It turns out that they all run "non…

Two things to consider: it seems reasonable for any organization - including a non-profit - to save some for a rainy day, and anything that doesn't get used immediately and doesn't get invested loses value just by sitting there (due to inflation).

IMO neither of those is enough to warrant a blanket "sure, why not?" answer to your first question and for there not to be any restrictions at all, but off the cuff it doesn't seem terrible.

As to your 2nd question: assuming you live in the U.S., it follows the laws of diminishing returns. It might be worth it to sit down with a non-sleazy tax adviser one time (and again each time you have a major life event) to make sure you're not missing anything big and/or easy, but pursuing every possible honest deduction is exhausting and time-consuming and so you eventually reach a point where chasing that next deduction is not worth your time.

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