SALT LAKE CITY — A local non-profit with ties to the polygamous Kingston group is facing multiple questions and accusations regarding its taxes.
FOX 13 spoke to the man who filed the IRS complaint against Ensign Learning Center, a private elementary school where members of the Kingston group send their children.
“Ensign Learning Center (ELC) has not declared nearly $12 million in assets,” the tipster wrote in his complaint. “Directors/ Officers/ Persons are using income/assets for personal gain… Organization is engaged in commercial, for-profit business activities… Organization failed to report employment, income, or excise tax liability properly.”
The complainant asked to not be identified, describing himself to FOX 13 as simply an interested third-party without any ties to the Kingston family.
The organization has not responded to multiple requests for comment.
Although the school is private, tax records for Ensign Learning Center are public due to its status as a 501c3 organization.
Over the past few years, members of the Kingston family have pleaded guilty to dozens of charges including fraud, money laundering, and obstruction due to their roles in the Washakie Renewable Energy scheme.
Ensign Learning Center has not been linked to the Washakie scheme.
Amanda Rae, who appeared on the television show Escaping Polygamy, said she left “the Order” after graduating from Ensign Learning Center to avoid having to marry her cousin.
“All the teachers there are Order members,” Rae said. “All I knew was that we had to keep polygamy a secret… When you grow up in it, it seems so normal, because you don’t know anything else.”
“The Order” is another name for the Kingston group, also known as the Davis County Cooperative Society.
The Southern Poverty Law Center has called the Kingston group a hate group.
“If an outsider asks an Order member about their religion, you’re never supposed to talk about the Order,” Rae said. “The laws don’t matter if it’s God’s kingdom on Earth.”
According to property records, Ensign Learning Center owns the schoolhouses for both Ensign Learning Center and Vanguard Academy, a public charter school.
The non-profit also owns 11 homes in Salt Lake County.
According to the complainant, Ensign Learning Center is not reporting the homes on their taxes.
“None of these assets are necessary for operating a private school,” the tipster wrote.
FOX 13 has learned each of the tenants are members of the Kingston family.
When approached for comment, none of the tenants were particularly forthcoming about why their house is owned by a school.
“I’m looking to speak to the owner of the house,” said FOX 13 investigative reporter Adam Herbets to a woman living in Taylorsville.
“That’s me,” the woman responded.
“OK. My name’s Adam. I’m with FOX 13, with the news,” Herbets said. “Do you work for Ensign Learning Center?”
“Oh. I’m not the owner of the house.” the woman responded. “Sorry.”
When told that somebody filed a complaint against Ensign Learning Center involving her home, the tenant responded with indifference.
“So?” she said. “I don't know anything. I don’t know anything! I don’t care! I don’t – anyway, I’m not going to talk.”
Only one tenant identified herself as an Ensign Learning Center teacher.
“I’m sure they would not cheat on their taxes,” the woman said.
“I think they know to be careful of what they say to anyone with a camera,” Rae explained. “I think that a lot of them are innocent. I really do.”
First she claimed to be the owner of the house. Then she changed her mind.— Adam Herbets (@AdamHerbets) January 14, 2021
When I told her someone filed an IRS complaint involving her home, she responded with indifference. pic.twitter.com/eSaatqq2XY
Rae’s mother lives in one of the homes owned by Ensign Learning Center.
“Yeah, my mom’s a member. She’s the second of three wives,” Rae said. “My relationship with my mom is very — it’s kind of confusing — but at the end of the day I love her, and I will always want to be here for her. I think that she deserves so much better than the life that she was given and the cards she was dealt in this life.”
According to Rae, her mother originally owned her home before joining the Order and signing it over to Ensign Learning Center.
When approached for comment, Rae’s mother stated she “doesn’t know anything” and that “there’s nobody here that is associated with Ensign.”
“From day one they teach you how important consecration is, that everything that you own, all of your incomings and outgoings have to be in the name of the Lord,” Rae explained.
FOX 13 has consulted with multiple non-profit experts to help analyze Ensign Learning Center’s public tax documents.
Brian Mittendorf, a professor of accounting at Ohio State University, said the organization lacks transparency and detail in its tax returns.
“We like to think that financial statements really tell a story about how an organization works, what it’s priorities are. Why is there not more information there?” Mittendorf asked. “A lack of transparency isn’t necessarily in and of itself an indication that something is wrong… It would be a concern if they were using (non-profit status) for their own personal benefit.”
Mittendorf said the organization’s “bare bones” documentation makes it difficult to tell whether the school is complying with its tax obligations.
“While technically they can own residential property, the question would be why?” Mittendorf said. “There’s a bunch of open questions that could have been answered by the (Form 990) but weren’t… if the 990 is not going to provide that information, it’s reasonable to ask those questions.”
Sam Brunson, a tax law professor at Loyola University Chicago, said he noticed “significant red flags” in reviewing the organization’s tax records.
“It is definitely possible to use non-profits and tax-exempt organizations to avoid taxes,” Brunson said. “One of the big things you can do is be pretty loose about who owns what.”
Brunson agreed that Ensign Learning Center’s tax returns do not provide enough information to determine whether the tipster’s accusations are valid, but he feels there is enough information for the IRS to open a formal investigation.
“We don’t want people to be able to privately benefit from tax-exempt organizations,” Brunson said. “They would not take my advice, but as an academic I would love more transparency.”
If the IRS finds that a violation occurred, possible penalties could range from a fine to criminal charges.
“At the end of the day, the Order is just a business,” Rae said. “It preys on people like my mom.”
IRS Special agent Stephen Washburn said he could not comment on the complaint or "confirm the existence of any investigation ongoing right now."
"What I can say is that IRS-Criminal Investigation takes complaints and referrals seriously, and these complaints are reviewed for any potential criminal violations," Washburn wrote in an email to FOX 13. "In the event there is not enough to go forward with a criminal investigation that referral is passed to the civil exam division of the IRS for any potential civil violations."
Washburn is the same IRS special agent who previously investigated the Kingston family and testified in the Washakie Renewable Energy case.
Edit (February 24, 2021): More than a month after Ensign Learning Center did not respond to multiple requests for comment, the Davis County Cooperative Society released a statement on February 23, 2021 disputing the accuracy of this report.
"It is the right and responsibility of journalists to shine the light of transparency on situations in our community, especially when it comes to uses of public funds," the statement read in part. “A quick look at the publicly available title of all but 2 of these homes shows they are not owned by the school at all."
FOX 13 has attached supporting documents from the Salt Lake County Assessor's Office, indicating the homes are in fact owned by Ensign Learning Center.
Although these records are public, FOX 13 has decided to block street numbers to protect the privacy of the individuals who live in these homes.