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James Huntsman files lawsuit against LDS Church alleging tithing fraud

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James Huntsman attends the Premiere Of Blue Fox Entertainment's "Summer '03" at the Vista Theatre on September 24, 2018 in Los Angeles, California. (Getty Images)

(KUTV) -- James Huntsman, the brother of former Utah Gov. Jon Huntsman Jr., is suing The Church of Jesus Christ of Latter-day Saints alleging it fraudulently spent millions of dollars in tithing meant for charity on commercial purposes.

The lawsuit was filed in the U.S. District Court for the Central District of California on Tuesday. The Washington Post was the first to report it.

Huntsman said in the complaint that he wants millions of dollars of his donations back and plans to give the money to “organizations and communities whose members have been marginalized by the Church’s teachings and doctrines, including by donating to charities supporting LGBTQ, African-American, and women’s rights.”

This comes 16 months after a former high-level investment manager with the Church filed a whistleblower complaint to the IRS, alleging the Church collected $100 billion in accounts intended for charitable uses and misled members by amassing surplus donations.

A spokesperson for the Church told the Washington Post that the claims are "baseless" and that Huntsman resigned his membership last year.

“Tithing funds are voluntary contributions... as an expression of their faith in God. They are used for a broad array of religious purposes, including missionary work, education, humanitarian causes and the construction of meetinghouses, temples and other buildings important in the work of the Church, as reflected in scripture and determined by Church leaders,” Eric Hawkins said in a statement to the Post.

Hawkins also told the Post that the Church is not in talks with the IRS about the complaint and nothing has changed with the use of funds from Ensign Peak Advisors, the church’s investment division, since the complaint.

The 2019 complaint alleged Ensign had not "directly funded any religious, educational or charitable activities in 22 years." It did, however, not provide any form of documentation to support the claim.

In his suit, Huntsman said after the 2019 report came out he tried multiple times to get his millions of dollars in donations back from the corporation.

"However, the LDS Corporation refused, effectively taking the position that it could do whatever it wanted with tithing funds," the suit said.

The Post reported Huntsman's lawyer, David Jonelis, said his client was disturbed by this and focused his lawsuit on the 2019 allegation that $2 billion from Ensign was used to bail out the church-run insurance company Beneficial Financial Group and City Creek Center, a joint venture between the Church and a real estate company.

Multiple Church officials have said tithing funds were not used to buy or develop City Creek, which opened in 2003.

Huntsman alleges the Church “repeatedly and publicly lied” about the use of tithing funds.

“Make no mistake, the Church’s status as a religious organization does not give its corporate arm carte blanche to defraud the Church’s members and the general public,” the suit states.

Hawkins released a statement to 2News Tuesday, which reads:

"Mr. James Huntsman resigned his Church membership last year. Now, he is demanding through his lawyers that tithing he paid to the Church as charitable contributions be returned to him. He claims that, contrary to assurances made by past Church President Gordon B. Hinckley, the Church used tithing to build City Creek, a mixed use commercial development across the street from Church headquarters in Salt Lake City.

“In fact, tithing was not used on the City Creek project. As President Hinckley said in the April 2003 General Conference of the Church, the funds came from 'commercial entities owned by the Church' and the 'earnings of invested reserve funds.' A similar statement was made by President Hinckley in the October 2004 General Conference. Mr. James Huntsman’s claim is baseless.

“Tithing funds are voluntary contributions by members of The Church of Jesus Christ of Latter-day Saints as an expression of their faith in God. They are used for a broad array of religious purposes, including missionary work, education, humanitarian causes and the construction of meetinghouses, temples and other buildings important to the work of the Church, as reflected in scripture and determined by Church leaders.”

The Post reports Huntsman runs a film distribution firm in Southern California. In 2016, he stepped down as an executive with Huntsman Corp., a chemical supplier his father founded in 1970. Jon Huntsman Sr., who died in 2018, was a billionaire industrialist and philanthropist in Utah.

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