Thursday, May 24, 2012

Joseph Smith's Mormon Banking Scam

Joseph Smith didn't run from Ohio because he was being persecuted, Old Joe was running from arrest warrants again.  Ohio had issued arrest warrants for Joseph Smith for illegal banking operations for the Mormon run "Kirkland Safety Society."

If you read Mormon history, this fleeing from arrest warrants has a spin to it:  "As violence against the Saints and their leaders escalated, it became unsafe for them to remain in Kirtland.  The Prophet whose life was in grave danger, fled Kirtland in January of 1838 for Far West, Missouri.  (Our Heritage:  A Brief History of The Church of Jesus Christ of Latter Day Saints, Building the Kingdom in Kirtland, Ohio, pg 36).

This illegal Mormon bank began with, of course, Joseph Smith receiving a revelation from GOD himself.  "Wilford Woodruff, who remained true to the Church and became the fourth President, confirmed the fact that Joseph Smith claimed to have a revelation concerning the bank."  (Joseph Smith's Kirtland Bank Failure,

The Mormons under Smith, after twice being turned down by the Ohio Legislature to start a legal bank charter, instead opened up a "quasi-bank," which were frequent in America at the time; but not exactly legal to be a "bank."

Joseph Smith had his Mormon bank "capitalized" at $4 million.  A huge sum of capital, when at the time, in the entire state of Ohio, the total capitalization of the banks was $9 1/3 million.  Setting itself up for failure.

For some casual observers wanting to see the Mormon banks assets, inside of the vault were boxes "filled" with gold and silver coin.  However, the boxes were first filled with sand, and then a thin layer of coin laid on top.  This shows fraud, not just mismanagement.

"Lining the shelves of the [Kirtland Safety Society] bank vault... were many boxes, each marked $1,000.  Actually these boxes were filled with 'sand, lead, old iron, stone, and combustibles' but each had a top layer of bright fifty cent silver coins."  said C.G. Webb (W. Wyl, Mormon Portraits, 1886, p 36).

"Things changed late in 1837; however, the loss of peace was not caused by violence against the Church but by financial duress.  A bank illegally organized by Joseph Smith and other LDS leaders in 1836, the Kirtland Safety Society, failed in November 1837, loosing a 'hornet's nest.  Creditors swarmed in upon Joseph armed with threats and warrants.  He was terribly in debt...the local non-Mormon creditors whom he could not repay bought a series of suits againt the prophet.'"  (Sharon Lindbloom, The Demise of the LDS Church in Kirtland,

Joseph's bank wasn't just milking money from his Mormon minions; but also non-Mormons as well.  As people attempted to withdraw money from the Mormon bank, "depositors" found out the bank notes were worthless.  Lawsuits, arrest warrants, and of course, some very upset Ohio residents were the result.

Mormons would rather have us believe that they were chased out of Ohio for being Mormon.  Mormons don't mention embellizing money from depositors, and Joseph Smith running on horseback in the dark of night, hours ahead of an arrest warrant for banking fraud.

Heber C Kimball, a future Prophet, was to comment "there were not twenty persons on earth that would declare that Joseph Smith was a prophet of God."

Indeed many Mormons left Joseph's church at this point, Joseph excommunicated or disfellowshipped others who were vocal against his bank.  Some started their own branch of Mormonism.

"Church News gave the distinct impression that the Mormons were driven from their homes in Ohio, fleeing for their lives.  The article's implication was that non-Mormons has persecuted the Saints to the point of grave physical danger and loss.  The unvarnished truth, that Joseph Smith's poor decisions brought financial ruin and spiritual desolation to his people, may not be pretty; but it's honest.  Instead of telling the truth and choosing not to mention that period of LDS history at all, Church News put tremendous spin on the story, laying blame on the innocent while manipulating sympathy for the guilty.  Unfortunately, history has shown this technique to be commonplace within Mormonism." (Sharon Lindbloom, The Demise of the LDS Church in Kirtland,

Have Mormons changed today when it comes to financial honesty?

Mormon Bishop Julius C Blackwelder, running a $400,000 ponzi scheme.

Mormon Joseph A Nelson, bilked investors out of $16 Million, promising 200 percent returns.

Mormon Bishop Shawn Merriman, defrauded investors with schemes to obtain money under false pretenses.

Mormons Wendell and Allen Jacobson, $220 Million ponzi scheme.

The list goes on and on. 

Apparently Mormon Utah is one of the nation's leaders in multi-level marketing; and we all know how reputable MLM companies are when it comes to making money as they claim.

1 comment:

  1. I have a Mormon tenant who is an accomplished con artist. I can abide his grand schemes and avoid them. However, he is also a deadbeat and does not like banks or to use them to pay his rent. He uses money orders and lives week to week or pay to pay. He has learned well from Smith. He is also dirty and a drug addict, marijuana, so not dangerous.