- Quick summary of the entire blog:
"The underlying premise for Tom Phillips' complaint is basically this: Young salespeople are being carefully groomed and trained to go out and spread demonstrable untruths among the British public in order to persuade them to pay over significant sums of money to a corporation. The transactions depend upon acceptance by individuals of certain "truth claims" which must be received on the basis of partial information presented. If members of the public were to be told the whole truth and still decided they would join up and pay up, that of course would be entirely legitimate. However, when the whole truth is deliberately concealed in order to project a false impression, and money exchanges hands, that is fraud... according to the 2006 Fraud Act, which is the relevant piece of legislation in this case." -Christopher Ralph (plaintiff in case of summons 2)
The media announcement
As is about to be or has just been reported in the media, Mormon Prophet and President, Thomas Monson was ordered on 31 Jan, 2014 to court and face allegations of fraud. He will reportedly receive two summons on this week his 47 East South Temple Street office in Salt Lake City.
According to the summons, Judge Elizabeth Roscoe in the Westminister Magistrate’s Court in London, England has issued Thomas Spencer Monson with 2 summons containing allegations of seven offences in contravention of Section 1 of the Elizabeth II Fraud Act 2006 .
(note: added the following paragraph)
Please understand, a magistrate has already reviewed the preliminary evidence (some described below) and found it worth making a trans-continent summons to a man at the head of a multibillion dollar US corporation. He must have seen a reason this was worth his time and the care it took to go through the case thus far.
The summons requires Monson to “appear before Westminster Magistrates' Court, 181 Marylebone Road, London, NW1 5BR on 14/03 2014 at 10AM in Courtroom 6 to answer the said information…”
The summons requires Monson to “appear before Westminster Magistrates' Court, 181 Marylebone Road, London, NW1 5BR on 14/03 2014 at 10AM in Courtroom 6 to answer the said information…”
Once Monson is processed by Westminister, the court will then almost certainly refer the case to Southwark Crown Court for further proceedings. The summons declares, “Failure to attend may result in a warrant being issued for your arrest.”
According to the Fraud Act 2006, the maximum penalty for the allegations contained in the summons is ten years imprisonment and a fine, for each offence. (See Section 3 (b)on conviction on indictment, to imprisonment for a term not exceeding 10 years or to a fine (or to both).)
The case details
I apologize for the length of this blog, and that this format may not be optimal, but the case details are many.
Here are images of the summons:
click on either to zoom in.
The summons indicates that “Information has been laid by Thomas Phillips” to “Thomas Spencer Monson” and before the magistrate, as such:
begin quote--
That between 3rd February 2008 and 31stDecember 2013 dishonestly and intending thereby to make a gain for himself or another or a loss or risk of loss to another made or caused to be made representations to [NAME], which were and which you knew were or might be untrue or misleading and thereby induce the said [NAME] to pay an annual tithe to The Church of Jesus Christ of Latter-day Saints, namely that
i) The Book of Abraham is a literal translation of Egyptian papyri by Joseph Smith.
ii) The Book of Mormon was translated from ancient gold plates by Joseph 'Smith is the most correct book on earth and is an ancient historical record.
iii) Native Americans are descended from an Israelite family which left Jerusalem in 600 B.C.
iv) Joseph and Hyrum Smith were killed as martyrs in 1844 because they would not deny their testimony of the Book of Mormon.
v) The Illinois newspaper called the Nauvoo Expositor had to be destroyed because it printed lies about Joseph Smith.
vi) There was no death on this planet prior to 6,000 years ago
vii) All humans alive today are descended from just two people who lived approximately 6,000 years ago
Contrary to section 1 of the Fraud Act 2006
--end quote
Two names were given in two summons as the parties to whom Monson made false representations: Stephen Colin Bloor and Christopher Denis Ralph.
Stephen Bloor is a third generation Mormon, a podiatrist who served as a Mormon bishop until he discovered the LDS Church gave many false representations. He penned a resignation as bishop and now writes a blog, campaigning for openness & honesty in the Mormon Church.
Christopher Ralph is a Mormon convert since 1971, who served in bishoprics, and in 2012 helped write open letters to the European Area Presidency, LDS First Presidency (Monson) and the quorum of the twelve apostles, on behalf of many troubled members in the UK. These letters were met with silence. Chris also was the first blogger to break the story behind Grant Palmer’s “undercover” Mormon General Authority.
Tom Phillips, the acting prosecutor, is a retired management consultant. A Mormon convert since 1969, he has served as a Bishop, Stake President and Area Executive Secretary. He received the unspoken and secret ordinance of the second anointing. He also served as the Area Controller for the British Isles and Africa as well as the Financial Director for the Church’s U.K. corporate entities.
The name of the magistrate who signed the summons is Judge Elizabeth Roscoe. I will try to find out more about her in time.
The relevant parts of the sections texts read:
Section 2 “Fraud by false representation”
(1)A person is in breach of this section if he—
(a)dishonestly makes a false representation, and (b) intends, by making the representation—
(i)to make a gain for himself or another, or (ii)to cause loss to another or to expose another to a risk of loss.
(2)A representation is false if—
(a)it is untrue or misleading, and (b)the person making it knows that it is, or might be, untrue or misleading.
Section 3 “Fraud by failing to disclose information”
A person is in breach of this section if he—
(a)dishonestly fails to disclose to another person information which he is under a legal duty to disclose, and
(b)intends, by failing to disclose the information—
(i)to make a gain for himself or another, or
(ii)to cause loss to another or to expose another to a risk of loss.
Evidence supporting fraud in violation Section 2 (fraud by false representation) is almost entirely historically or scientifically based doctrinal claims that Monson made, which appear misleading to encourage Mormon members to donate money based on false statements that have been shown by science, the media, academics and other institutions to be incorrect and perhaps even slanderous statements with the intent to defraud by encouraging donations to the church on the basis of the false statements. An example of one statement in the prosecutor’s case states that Monson has taught the Book of Mormon is a divine work given by God to Joseph Smith, and is “most correct book on earth, and an ancient historical record.” However, the prosecutor will argue that academics have shown that “the Book of Mormon has been shown to be a work compiled in the 19th century by Joseph Smith with or without the help of others.” And that “DNA evidence demonstrates overwhelmingly that the ancestors of Native Americans came from Siberia around 15,000 30,000 years ago. No trace has been found of Hebrews in either North or South America, and there's no archaeological evidence for any of the Book of Mormon people.”
The prosecutor argues in his case, “These are not statements of mere 'beliefs' or opinions or theories, they are made as actual facts and their truthfulness can be objectively tested with evidence, unlike religious claims and beliefs.” That the LDS prophet has “made statements of fact which are untrue and he knows, or should know, they are untrue” as an argument that he has perpetuated fraud on the British people with “The purpose … to facilitate the conversion of individuals to become members of the Church of Jesus Christ of Latter-day Saints and to pay to said church 10% of their income on a continuing, permanent basis.”
Evidence supporting fraud in violation of Section 3 (Fraud by failing to disclose information) uses LDS church documents showing that they know certain statements are false but continue to teach them and encourage members to pay tithing. For example, the claim that the Book of Mormon is an ancient record about Hebrews filling the lands in ancient America can be disputed by DNA evidence, and the church has acknowledged they know about the evidence, but have not taught this to members.
[ blog note: I would like to know that the recent essay release on the Book of Mormon and DNA studies alters the equation here. The timing of the release, on 31 January coincides exactly with the date the Magistrate signed the order.]
The evidence for the claims of fraud are laid out by Tom Phillips, as “statements have been made verbally and also published in various forms, including but not limited to: Church manuals such as Gospel Principles (2011), Church magazines such as ‘The Ensign’, Talks by Church leaders, printed and broadcast by satellite and over the internet, Websites owned or operated by the Church.”
As the summons states, the following frauds are represented in the case. With these are a few additional notes from the prosecutor’s case, but do not represent the sum-total of the information to be laid out to the judge.
i) The Book of Abraham is a literal translation of Egyptian papyri by Joseph Smith.
[prosecutor intends to state that “all experts in Egyptology agree the “Book of Abraham” is not a translation of the papyri the Church has in its possession. There are no references to Abraham and Joseph and the interpretations of the facsimiles reproduced in the book are not true. The papyri are, in fact. common funerary texts found on countless Egyptian ‘mummies’. The Church leaders have been informed of these facts, yet still state it is a translation. Rather than admit their founder (Joseph Smith) lied about this matter, they deliberately and dishonestly repeat the falsehood in order to deceive their Church members and potential converts.”]
ii) The Book of Mormon was translated from ancient gold plates by Joseph 'Smith is the most correct book on earth and is an ancient historical record.
[prosecutor statement is given above, and also includes “Not only is there no evidence of such civilizations, there is abundant evidence that they did not exist. Certain of the animals and working materials, supposedly used by them, did not exist on the American continent at the time (600 B.C. to 400 A.D.).”]
iii) Native Americans are descended from an Israelite family which left Jerusalem in 600 B.C.
[prosecutor: “anthropology and DNA denote Native Americans are of Asian origin and came to America, some 15,000 to 30,000 years ago. No trace of Israelite DNA has been discovered in the study of Native American peoples.”]
iv) Joseph and Hyrum Smith were killed as martyrs in 1844 because they would not deny their testimony of the Book of Mormon.
[prosecutor: “they died in a gun battle while incarcerated in jail on charges of treason against the state of Illinois. It had nothing to do with their defence of the Book of Mormon and Church historians know that.”]
v) The Illinois newspaper called the Nauvoo Expositor had to be destroyed because it printed lies about Joseph Smith.
[prosecutor: “the claims made about Joseph Smith, in the newspaper, are true i.e. he taught and practised plural marriage (polygamy) and he was ordained a king.”]
vi) There was no death on this planet prior to 6,000 years ago
[prosecutor: “there has been death of living organisms on this planet for billions of years.”]
vii) All humans alive today are descended from just two people who lived approximately 6,000 years ago
[prosecutor: “anthropology, history and DNA studies prove this to be impossible. Our earliest common female ancestor is considered to have lived about 150,000 years ago.”]
The prosecutor makes a case of general dishonesty against Monson, highlighting his education and ability to know the answers and facts contradicting his false representations, saying: “He has received formal education to masters degree level and has also received honorary doctorates. He is well educated beyond the level at which an ordinary person would or should know the representations are false.”
The prosecutor outlines the following cases of dishonesty with little detail (as yet provided):
- · Found guilty on election fraud (proposition 8 in CA,USA)
- · Holland lied to BBC interviewer
- · LDS Church has been reported and accused of tax evasion in the UK (more below)
The prosecutor makes the case for why Monson perpetuated this fraud: “The purpose of these untrue and misleading statements is to facilitate the conversion of individuals to become members of the Church of Jesus Christ of Latter-day Saints and to pay to said church 10% of their income on a continuing, permanent basis. A second purpose is to mislead those individuals who are already members of the said Church, so that they will continue paying 10% of their income. This tithing income is paid in the United Kingdom to The Church of Jesus Christ of Latter-day Saints (Great Britain), an unlimited liability company and registered charity with its registered office in England. The President of the two corporation sole shareholders of this U.K. company is Thomas Spencer Monson.”
For more information about the corporation sole and its structure with articles of incorporation, see my blog from 2012 with more details.
Addionally, the prosecutor argues that non-Mormon or non-paying Mormon family members “cannot attend the wedding ceremony unless they too are members of the Church and, among other conditions, pay a full tithe. If they have been amiss is paying, but are willing to pay the arrears of the past year, they may be allowed. Therefore, they have to pay to attend their child’s (sibling’s) wedding... Thus, they take away a normal parental right and then charge you money if you want the ‘benefit’ they have taken from you. Nobody would agree to such a regime unless they believed the false representations to be true.”
The information supplied to the court by the prosecutor claims, “As an example of the financial gain to the Church (and, therefore, loss to the individuals making the contributions), since the implementation of the Fraud Act 2006 (i.e. January 2007) the donations received in the U.K. in consequence in part at least of these false representations amount to approximately £224 million, according to the accounts filed with the Charity Commission from 2007 to 2012 inclusive . The current year (2013) could be a further £33 million making a total of £257 million.”
Here is a table pulled from the UK Charity Commission website under the “Financial history” section.
click on image to zoom in
The previous year, I had reported these figures in this blog, just after reporting on the Mission President Handbook release.
Significant detail about the church’s activities in the UK can be downloaded from the commission’s website under the “View accounts” section.
The summons was signed 31 January 2014 and issued under section 1 of the Magistrates’ Courts Act 1980, on receiving a formal Statement (described in that section as an ‘information’) alleging that someone has committed an offence, the court may issue—
(a) a summons requiring that person to attend court; or
(b) a warrant for that person’s arrest, if—
(i) the alleged offence must or may be tried in the Crown Court,
(ii) the alleged offence is punishable with imprisonment
Now, my personal take on this:
I applaud and support Tom in trying to call out the LDS leaders on perpetuating fraud. I believe it is true. I believe they know more than they are willing to teach to the average member. I believe the Topic Essay articles addressing issues that questioning members have raised recently (such as with Christopher Ralph’s letter or the Swedish Rescue fiasco) show that they have been aware of these problems for many years. It is interesting that they are now dealing with these issues, just about the time Tom started filing his fraud case last year, and that the DNA essay arrived the day the summons were sent.
However, I approach all of this with skepticism on its success. The LDS Church is very wealthy, retains full-time about half of the 150+ lawyers at McConkie and has a team of lawyers in its own legal department. You can bet they will throw their full effort into defending against these charges and try to get even the summons dismissed. The LDS Church has considerable political weight in the US, with church members occupying positions on the judicial bench at every level in both state (UT) and federal branch. They have church members holding 7% of the US Senate, including the senate majority leader, the ranking member of the finance committee and more. This from a church whose US membership is just a hair below 2% and whose active members might peak 1% of the US population. That is a lot of political, judicial and legal might for such a fraction of a minority of the population.
Furthermore, I believe no judge, UK or US, will want the responsibility to set a precedent of finding a church leader as powerful as even the small church’s Mormon Prophet guilty of fraud through "ideological" deceit. To most eyes outside of the LDS Church, this case will look mostly ideological, and that sets it up for problems because no judge wants to preside over a jury conviction against free exercise of religion. At least, that would be the public perception, even if the fraud claims are about false representations made on facts of science and history, and not just about beliefs. But the public will not understand such nuances. The LDS Church PR machine will ensure that it appears victimized by ex-members and “anti-Mormons” who challenge its basic rights to free exercise.
(note: added a change below)
Now, if it goes to trial there Tom has some confidence 12 U.K. jurors will convict. He believes the evidence is overwhelming and Monson will not be credible to the jurors on the stand. The question I maintain, however, is whether the responsibility of this precedent is too high for even a liberal judge in the UK or other parts of Europe.
Now that said, Scientology has had difficulty with fraudulent court cases in Germany and found responsible for unethical if not criminal behavior based on a few ridiculous beliefs used for extracting money from believers.
Let's think about this. If you own a patch of land and you make mythical claims about leprechauns and unicorns roaming its pastures and you can convince a potential buyer to pay far more money than its true value based on obvious fraudulent claims, the court will cite you with charges to defraud with false representation. In effect, the Mormon Church has made claims that are used to increase the value of afterlife mansions and treasures in heaven, requiring temple attendance to be considered a worthy and saved member. Attending the essential temple ceremonies in turn requires one to be worthy in accepting beliefs/teachings, the near infallibility (sustaining) of prophets, tithing and donations. The teachings and the claims of the prophets who one is required to sustain are what the fraud case examines--the claims that can be verified accurately with modern science and history to show as completely fraudulent.
How is that really much different than selling someone pristine homesteads in Florida swamplands with the claim they are waterfront property? You hear the sales pitch, and if you buy without verifying the claims, you can still sue for fraudulent claims.
I know, the sacred untouchable free exercise of religion is a high tower. When a religion can claim any old theory as part of its religion, including particle physics, archaeology, astronomy and more--all of which are total bunk in modern science, shouldn't it be held to the same standard as Florida swampland homesteaders?
(And yes, Mormons make claims about spirit elemental particles, archaeology of ancient America, kolobian astronomy and energy sources...)
However, what Tom (primarily) and the MormonThink team (supportive) have done is truly amazing. It forces the issues into the open record of the legal field, and may even go to trial long enough that Monson’s legal team will have to clarify on the record the answers to these troubling issues. No more will the answers come from quietly released essay articles that are not dated, time stamped, authored or authorized by any names. The nameless, dateless and non-authoritative nature of the article responses to issues could be made a matter of legal and public record. That is a huge win, even if Monson is completely unlikely to be convicted on any counts of fraud.
Monson’s age is a problem. He’s in his late 80s (86?) and a good legal team can make the case he is unable to stand trial for health reasons. However, that is not a concession the LDS Church PR machine wants to make. They don’t want to represent their president as incompetent. Rest assured, the legal team has many other tricks to use first before pulling the senile card. And I’m betting against a trial even happening because of the amount of legal weight behind Monson.
Something better?
Now, if there were a financialsmoking gun with documents showing clear fraud, then the case could make trial and even possibly conviction. Financial fraud is much clearer and more easily convicted than a fraud based on seemingly ideological issues.
In December 2012, I reported receiving a copy of the Mission President’s Handbook from a church insider. This created quite a stir. And even the Intellectual Property LDS legal representative affirmed under penalty of perjury that it is a legitimate copy. Recall, in the MP Handbook Appendix B is detailed how the Mission Presidents were to keep payments to them quiet and not report them to tax authorities. Quote:
"do not share information on funds you receive from the Church with those who help you with financial or tax matters ... never represent in any way that you are paid for your service. ... do not list any funds you receive from the Church, regardless of where you serve or where you hold citizenship.”
Mission presidents are told that they “should not open a local bank account for personal funds received from the Church . . . especially if the account would produce interest (and thus raise income tax questions).”
Instead of allowing mission president control over their personal funds, “a joint personal bank account at Church headquarters is established for you and your wife.”
The handbook advises the mission president that “any funds reimbursed to you should be kept strictly confidential and should not be discussed with missionaries, other mission presidents, friends, or family members.”
Here are the specific reimbursements dispensed out of the payment the LDS Church deposits in the Mission President's account.
“While you are serving as mission president, the Church reimburses the necessary living expenses for you, your wife, and your dependent children.”
These “necessary” living expenses include:
- - Rent or lease or house payment,
- - Food,
- - Clothing,
- - Household supplies,
- - Family activities,
- - Dry cleaning,
- - Personal long-distance calls to family,
- - Modest gifts (for example, Christmas, birthdays, or anniversary),
- - Utilities,
- - Telephones,
- - Internet connection,
- - Gardening, (employed gardener)
- - Repair or replacement of household items,
- - Part-time housekeeper,
- - Part-time cook,
- - One mission automobile assigned exclusively to the mission president,
- - Other assigned mission vehicles (used by the wife or licensed dependents for“shopping, taking children to school, or other needs.)
- - Automobile insurance, registration and taxes on assigned vehicles,
- - Medical expenses (dental, eye care and medically necessary orthodontia),
- - One round trip fare for each child under age 26 to visit the parents’ mission,
- - Elementary and secondary school expenses for tuition, fees, books, and materials,
- - Undergraduate tuition at an accredited college or university,
- - Financial support for children serving full-time missions
While most of those sound reasonable, many are seen as taxable, especially in the UK. According to their tax authority, document SA012M from Her Majesty’s Revenue Customs (HMRC)on tax rules for “ministers of religion”:
Ministers are to report as income “fee” and “contractual payments” or any “gift or grants you receive because of your work”. They even ask the minister to declare “salary” or “stipend” in “box 2”. The stipend received by mission presidents makes it clear they are considered employees in the UK, and the amounts paid to them or reimbursed to them as a 'living allowance' is a salary. Add to that the cash equivalent of the benefit of housing, cars, medical insurance, college fees, cook, family travel etc. This needs to be "grossed up" and tax and employee national insurance contributions paid on it. Also the church as employer has to pay National Insurance Contributions (like US Social Security payroll tax) on the gross less a "lower earnings limit" at 13.8%. The church had in 2013 5 MPs in the U.K. (they used to have 8 in previous years). This kind of tax evasion has probably been going on for over 30 years. The amounts involved, plus interest and penalties will be in the millions of dollars.
Here then, is an estimate on Mission President "salary":
Food & Household Supplies £8,000
Clothing £4,000
Family Activities £3,000
Dry Cleaning, Personal long distance phone £1,000
Gifts - Christmas, birthdays, Anniversaries £2,000
Medical Insurance and other medical bills £6,000
Tuition Fees - school and university £3,000
Family Travel (from US) for under 26 y.o. £1,000
Utilities - heating, council tax etc. £4,000
Gardener and Cook £9,000
Mission costs if child serving mission
Term Life Insurance up to $100 per month £800
SubTotal £41,800
House taxable benefit at 4% (on £600K home) = £24,000
Car Benefit £5,000
Total = net pay £70,800
Employee's NIC = maximum of £4,430
£75 k grossed up = approximately £105,000
Employer's NIC at 13.8% of excess £13,722
Fraud can be reported, and now has been reported to the UK HMRC at their website. Tom Phillips, who reports that he worked as the financial director for LDS Church corporate entities has said concerning the unpaid taxes on Mission President account reimbursements and stipends:
" It was discussed at a First Presidency meeting with the Presiding Bishopric and they decided to continue not reporting and pay any fines when, and if, they were discovered. This is blatant tax evasion, a criminal activity in the UK. I never kept any documentary evidence but this hand book would be incriminating for them. "
(note: added the following)
Tom also tells me: "The tax evasion case will be brought by the government later this year. However Monson won't be charged personally with that. It will be a corporation and the penalty will be a fine. Monson can claim he left all that to his accountants. Also the size of the 2 cases $10m tax evasion vs $300m in tithing fraud. See the difference? On tax evasion he does not get prosecuted, the COP pays a fine. On fraud, if convicted, he goes to prison and could be ordered to pay tithing to victims and have hundreds of millions of church money confiscated.
" That is why I concentrated on the fraud case and just reported the tax evasion to HMRC. Fraud is the bigger and mote damaging issue. However, it is not a question of one or the other. Both cases are going forward."
(note: added the following)
Tom also tells me: "The tax evasion case will be brought by the government later this year. However Monson won't be charged personally with that. It will be a corporation and the penalty will be a fine. Monson can claim he left all that to his accountants. Also the size of the 2 cases $10m tax evasion vs $300m in tithing fraud. See the difference? On tax evasion he does not get prosecuted, the COP pays a fine. On fraud, if convicted, he goes to prison and could be ordered to pay tithing to victims and have hundreds of millions of church money confiscated.
" That is why I concentrated on the fraud case and just reported the tax evasion to HMRC. Fraud is the bigger and mote damaging issue. However, it is not a question of one or the other. Both cases are going forward."
This act won't probably do more than put a slow-down in their land grabs and power purchases. In a couple of months, it will be back to secret business as usual. With one difference: More of us will be watching and so will the media.
