Why the LDS Church says tithing funds should be kept secret

Lawyers cite “religious reasons” in James Huntsman’s appeal, argue it has as much do with the Bible as the Constitution.

(Francisco Kjolseth | The Salt Lake Tribune) The Church of Jesus Christ of Latter-day Saints' Church Office Building on Wednesday, March 30, 2022. Lawyers for the church argue in the James Huntsman legal appeal that faiths need not disclose their finances for "religious" as well as constitutional reasons.

Information about tithing — and church finances in general — must remain firmly shielded from public view, say lawyers for The Church of Jesus Christ of Latter-day Saints.

In one of the Utah-based faith’s more direct assertions of a need for secrecy regarding its wealth, attorneys defending against a fraud lawsuit brought by former Latter-day Saint James Huntsman are asserting the church “keeps its finances private for religious reasons” and “is religiously bound to maintain the confidentiality of its financial records.”

The contentions come as the global church of 16.8 million and Huntsman, who now lives near San Diego and is a brother of former Utah Gov. Jon Huntsman, are clashing in motions and countermotions before the 9th U.S. Circuit Court of Appeals in California.

In September, a federal judge threw out James Huntsman’s lawsuit, which alleged that top church leaders lied about how they spent members’ donations, and his quest to recover up to $5 million of his tithing, with interest and penalties.

With the case now on appeal before the circuit court, Huntsman is trying to open up a set of financial records, sealed by the lower court, that delve into $2 billion of church spending on two of its commercial businesses, including City Creek Center, the high-end shopping complex in the heart of Salt Lake City, and Beneficial Life Insurance Co.

Huntsman argues there is a “strong public interest in access to financial information from tax-exempt organizations like the church,” and he wants the redacted information shown to U.S. District Court Judge Stephen V. Wilson released to the public.

“While Mr. Huntsman may himself have access to the sealed records,” his lawyers wrote, “there are surely countless members of the public who have the same concerns as Mr. Huntsman about how the church funded the City Creek mall, but who (since they are not parties hereto) are precluded from seeing the church’s purported financial information.”

The church’s redactions, they added, appear to be primarily aimed at “concealing the amount of money it has. Of course, the amount of one’s wealth is not a propriety fact, in and of itself.”

Would financial disclosures ‘harm’ the church?

Church attorneys push back adamantly, maintaining Huntsman has reneged on his prior consent to keep the financial information away from public eyes and for the judge’s review only. Their court motions invoke passages from the Bible as well as the U.S. Constitution’s protections for religions under the First Amendment.

“Coerced disclosure of church finances, already sealed, would expose innumerable ecclesiastic decisions about how and where sacred church funds are spent,” Los Angeles-based church attorney Rick Richmond wrote in a brief earlier this month. “It would subject those decisions to public scrutiny, pressure and questioning.”

Release of financial information could also “afford insight to opponents and those seeking to harm the church” and its business entities, he warned, saying the church treats it as “highly confidential” and bars its own employees from sharing it outside of church circles.

Huntsman’s lawyers, led by Los Angeles-based David Jonelis, counter that it is “patently unfair for the church, on the one hand, to publicly accuse Mr. Huntsman of making ‘unfounded’ allegations, while, on the other hand, refusing to disclose the very documents that purport to refute Mr. Huntsman’s allegations.”

Prominent advocates for religious freedom, meanwhile, are also seeking to jump into the lawsuit with an amicus brief supporting the church’s position.

The Washington, D.C.-based Becket Fund for Religious Liberty argues in its own motions before the 9th Circuit that tithing is an inherently religious practice and that fact alone should bar courts from scrutinizing internal church decisions about it.

Separate from the dispute over unsealing documents, Becket asserts Huntsman’s underlying case is legally invalid under constitutional protections meant to keep governments and courts out of church affairs.

“Con men who cloak themselves in religion are not beyond the reach of the law,” the group’s attorneys wrote in their request to join the case. “But the First Amendment’s religion clauses bar courts from second-guessing how churches spend their money just because some tithe payers disagree.

“Freedom of religion could not survive,” they cautioned, “if courts had power to investigate every complaint about a church’s spending choices, thus becoming endlessly entangled in religious decision-making.”

The church’s assertions of a religious basis for financial secrecy are partly distilled from lower court testimony submitted to the federal judge by Paul Rytting, an attorney and longtime director of risk management for the faith. The motions also draw from biblical admonitions on the giving of alms.

“Jesus taught: ‘Take heed that ye do not your alms before men, to be seen by them,’” they wrote in one footnote, quoting Matthew 6:1. As a result, devout Latter-day Saints who observe the practice of donating a tenth of their income in tithing do so privately, under a belief it is the will of God.

“It is also an important church doctrine that the giving of alms by church members and the care and use of those alms by the church itself should be done privately and discreetly,” they stated. “... To be sure, there are times when the church makes public its humanitarian efforts. But when and how to do so while being faithful to these scriptural injunctions is purely an ecclesiastical matter.”

Church used to disclose its finances

Though implied in the legal motions, it is unclear if top church leaders actually share the belief in a wider religious obligation to not disclose financial information, said Sam Brunson, a Latter-day Saint and tax law professor at Loyola University in Chicago.

“If they do, though, it’s relatively new,” Brunson said. “Until about the middle of the 20th century, the church made relatively fulsome disclosures of its finances.

“Other exempt organizations have to make financial disclosures,” Brunson noted, “and I tend to think churches shouldn’t be exempt from that requirement.”

Matthew Bowman, head of Mormon studies at Claremont Graduate University in Southern California, said he suspected the church’s choice not to be transparent about its finances was rooted in “institutional inertia.”

“That’s been the way it has been done for 70 years now and changing that would be difficult institutionally,” Bowman said. “There is a generation of management in the church that simply takes this for granted by this point.”

Editor’s note • James Huntsman is a brother of Paul Huntsman, chairman of the nonprofit Salt Lake Tribune’s board of directors. This story is available to Tribune subscribers only. Thank you for supporting local journalism.