Thirty-Two (1837)Because the Church’s main theme was the “gathering of the Saints into Zion,” the
priesthood councils authorized buying large tracts of land on credit with hopes of reselling
it to incoming Saints at a good profit.
The financial situation of the Church became dire. The High Councils spent the
majority of their time trying to figure out what to do. They fasted and prayed, calling upon
God to help them and give them inspiration. Their “god,” “the God of this world”^75 (i.e.,
their own flesh), finally answered them: “Do you have any money? You can buy anything in
this world for money.”^76 The men received their answer—it was to create their own money.
The Kirtland Safety Society Bank is Established
At the time, many banks were opening their doors with new legal charters
authorized by the U.S. Congress to help expand the Union’s economies. The Church of the
Latter Day Saints^77 opened its own bank and called it the Kirtland Safety Society (KSS)
bank.^78 The leaders, excluding Joseph, were convinced that the Lord would bless their
efforts, so they set the capital stock at $4 million. Only about 200 people purchased stock in
the bank with about $20,000 in cash. This made the actual worth of the stock less than a half
of a half of a penny. Because of their faith in their god, the leaders began to buy up the stock
for unheard of low prices. Heber C. Kimball bought $50,000 worth of shares for $15,^79
proclaiming, “The riches of the land shall soon be mine and the Lord’s.” Many put up land
instead of cash in exchange for stock in the “Lord’s bank.”^80
The Church’s bank started issuing notes without first receiving a legal charter from
the State of Ohio.^81 Joseph toyed with the rules and regulations of bank finance and
eventually called the notes “anti-banking notes,” issued by the Church’s “anti-banking”
company, in order to circumvent the law. The bank issued over $100,000 in worthless
notes that the leaders hoped would be trusted by the people the same as legal bank notes.
The bank began to fail within its first month.^82
The Saints had used their “divinely” speculative notes to purchase goods and
services outside of their Mormon community and to pay off some of the debt they incurred
prior to printing their own money. Missionaries carried the notes with them from Kirtland
and spread the legally worthless notes throughout other areas. Beyond merely selling copies
of the Book of Mormon and promoting their church, the missionaries arrogantly presented
their notes for payment of goods and services, as if their money was more sound than that
of any other bank. For one of many examples, the Saints would convince a farmer to sell a
cow, not for $25 in the farmer’s local bank notes, but for $100 in Kirtland Safety Society
notes. Many of the misinformed people trusted the notes, being convinced by the sincerity
of the Mormons, who assured them by “my word before God and his angels”^83 that the
notes were good. Who could argue with the backing of “God” and his “angels”?
When the people started finding out that the Kirtland bank was operating illegally,^84
they ran to the bank to redeem their notes for real cash or gold, but there was almost
nothing in the bank’s reserves. The Kirtland bank tried to reissue new notes to cover the old
ones. The game went on for a short time until the people began to file lawsuits against
Joseph and Sidney Rigdon, who had both signed the notes. Both men were forced to resign
as treasurer and secretary, leaving the defunct bank in chaos and a whirlwind of fraud.
Neither the Church nor its members could buy on credit from the other local non-
Mormon retailers because they could no longer be trusted to repay their debts. The
Mormons’ fraud spread like wildfire throughout the region, eventually reaching