Creation of the Kirtland Safety Society - Revision history

SpencerMarsh at 16:15, 25 June 2026

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	<h1><b>The Creation of the Kirtland Safety Society</b></h1>		<h1><b>The Creation of the Kirtland Safety Society</b></h1>
	{{Summary1}} The Kirtland Safety Society was a financial institution organized by Joseph Smith and other Church leaders in Kirtland, Ohio, in 1836–1837 to help meet the economic needs of a rapidly growing Latter-day Saint community. The organizers initially sought a legal bank charter but were denied by the Ohio legislature, leading them to reorganize as an "anti-banking" company under the advice of legal counsel. The venture operated during a period of widespread land speculation and financial instability and ultimately failed amid the national financial panic of 1837. While the decision to proceed without a charter was unwise and later found to violate Ohio banking law, the evidence does not support claims that Joseph Smith intentionally defrauded investors. Instead, the failure is was a combination of poor legal advice, economic turmoil, and the challenges facing frontier financial institutions during a national economic crisis.		{{Summary1}} The Kirtland Safety Society was a financial institution organized by Joseph Smith and other Church leaders in Kirtland, Ohio, in 1836–1837 to help meet the economic needs of a rapidly growing Latter-day Saint community. The organizers initially sought a legal bank charter but were denied by the Ohio legislature, leading them to reorganize as an "anti-banking" company under the advice of legal counsel. The venture operated during a period of widespread land speculation and financial instability and ultimately failed amid the national financial panic of 1837. While the decision to proceed without a charter was unwise and later found to violate Ohio banking law, the evidence does not support claims that Joseph Smith intentionally defrauded investors. Instead, the failure was a combination of poor legal advice, economic turmoil, and the challenges facing frontier financial institutions during a national economic crisis.

	<small>Video published by the Church History Department.</small>		<small>Video published by the Church History Department.</small>

SpencerMarsh at 16:10, 25 June 2026

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	====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====		====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====

	After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>{{BYUS\|author=Scott H. Partridge\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=655 The Failure of the Kirtland Safety Society]\|vol=12\|num=4\|date=Summer 1972\|start=439}}</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=34}}</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, "Chartering," 474–75; see also Hill, Rooker, and Wimmer, "Kirtland Economy," 434–35.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, and Wimmer, "Kirtland Economy," 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-67.</ref>		After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>{{BYUS\|author=Scott H. Partridge\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=655 The Failure of the Kirtland Safety Society]\|vol=12\|num=4\|date=Summer 1972\|start=439}}</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=34}}</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, "Chartering," 474–75; see also Hill, Rooker, and Wimmer, "Kirtland Economy," 434–35.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, and Wimmer, "Kirtland Economy," 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366–67.</ref>

	On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, "Chartering," 454.</ref>		On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, "Chartering," 454.</ref>

SpencerMarsh at 16:10, 25 June 2026

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	====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====		====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====

	After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>{{BYUS\|author=Scott H. Partridge\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=655 The Failure of the Kirtland Safety Society]\|vol=12\|num=4\|date=Summer 1972\|start=439}}</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=~~434~~}}.</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, "Chartering," 474–75; see also Hill, Rooker, and Wimmer, "Kirtland Economy," 434–35.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, and Wimmer, "Kirtland Economy," 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-67.</ref>		After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>{{BYUS\|author=Scott H. Partridge\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=655 The Failure of the Kirtland Safety Society]\|vol=12\|num=4\|date=Summer 1972\|start=439}}</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=34}}</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, "Chartering," 474–75; see also Hill, Rooker, and Wimmer, "Kirtland Economy," 434–35.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, and Wimmer, "Kirtland Economy," 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-67.</ref>

	On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, "Chartering," 454.</ref>		On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, "Chartering," 454.</ref>

SpencerMarsh at 16:07, 25 June 2026

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	====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====		====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====

	After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>{{BYUS\|author=Scott H. Partridge\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=655 The Failure of the Kirtland Safety Society]\|vol=12\|num=4\|date=Summer 1972\|start=439}}</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=434}}.</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, 474–~~475~~; see also Hill, Rooker, & Wimmer, 434–~~435~~.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, & Wimmer 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-~~367~~.</ref>		After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>{{BYUS\|author=Scott H. Partridge\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=655 The Failure of the Kirtland Safety Society]\|vol=12\|num=4\|date=Summer 1972\|start=439}}</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=434}}.</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, "Chartering," 474–75; see also Hill, Rooker, and Wimmer, "Kirtland Economy," 434–35.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, and Wimmer, "Kirtland Economy," 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-67.</ref>

	On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, 454.</ref>		On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, "Chartering," 454.</ref>

	====The Kirtland Safety Society was an unwise venture that was probably illegal, though legal counsel was divided on that matter at the time====		====The Kirtland Safety Society was an unwise venture that was probably illegal, though legal counsel was divided on that matter at the time====
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	;'''scrip:''' paper money, issued by a bank. An example of KSS scrip can be seen [http://www.mormonmoney.com/Kirtland%20Anti-Bank%20Notes.htm here].		;'''scrip:''' paper money, issued by a bank. An example of KSS scrip can be seen [http://www.mormonmoney.com/Kirtland%20Anti-Bank%20Notes.htm here].
	;'''suspension of payment:''' an indication by a bank that, until further notice, it can no longer redeem its scrip with the face value of specie.		;'''suspension of payment:''' an indication by a bank that, until further notice, it can no longer redeem its scrip with the face value of specie.
	;'''wildcat bank:''' a bank established as a money-making scam. "A wildcat bank was one in which the managers of the bank made a deliberate effort to evade paying off notes by making the place of redemption inaccessible to those trying to trade notes for specie".<ref>Partridge, 451</ref> Thus, the bank kept the specie, and the note holder was left with worthless paper which no one would honor, since it could not be redeemed (the bank being located "where the wildcats are"). Such banks usually collapsed quite quickly when it became clear that their notes were not easily redeemed.		;'''wildcat bank:''' a bank established as a money-making scam. "A wildcat bank was one in which the managers of the bank made a deliberate effort to evade paying off notes by making the place of redemption inaccessible to those trying to trade notes for specie".<ref>Partridge, "Failure," 451.</ref> Thus, the bank kept the specie, and the note holder was left with worthless paper which no one would honor, since it could not be redeemed (the bank being located "where the wildcats are"). Such banks usually collapsed quite quickly when it became clear that their notes were not easily redeemed.
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	<blockquote>		<blockquote>
	The founders of the Kirtland Bank would have avoided their distress if national and state leaders had allowed financial markets to grow in an orderly manner. One medium-sized, twenty-year mortgage would have solved most of the financial problems faced by these founders.<ref>Adams, 481–~~482~~.</ref>		The founders of the Kirtland Bank would have avoided their distress if national and state leaders had allowed financial markets to grow in an orderly manner. One medium-sized, twenty-year mortgage would have solved most of the financial problems faced by these founders.<ref>Adams, "Chartering," 481–82.</ref>
	</blockquote>		</blockquote>

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	To finance this explosive growth, loans were sought. Joseph Smith and the Church had extensive loans; some loans were for Joseph, some for Kirtland, and some for the Church. In some instances, Joseph was the only borrower, in other cases he was one among many who were liable for a given debt.		To finance this explosive growth, loans were sought. Joseph Smith and the Church had extensive loans; some loans were for Joseph, some for Kirtland, and some for the Church. In some instances, Joseph was the only borrower, in other cases he was one among many who were liable for a given debt.

	Banks do not loan money to those they consider poor risks, and so to his contemporaries, Joseph clearly appeared to have the ability to meet his obligations. The amount of the loans seems to have been less than the total value of the lands, businesses, and goods which Joseph and the Church owned. However, these assets were difficult to liquefy—the loans were often short-term (from a few weeks to around 180 days) and so cash flow problems beset Joseph continually.<ref>See Hill, Rooker, and Wimmer, 389–471.</ref> {{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=389\|end=471}}</ref>		Banks do not loan money to those they consider poor risks, and so to his contemporaries, Joseph clearly appeared to have the ability to meet his obligations. The amount of the loans seems to have been less than the total value of the lands, businesses, and goods which Joseph and the Church owned. However, these assets were difficult to liquefy—the loans were often short-term (from a few weeks to around 180 days) and so cash flow problems beset Joseph continually.<ref>See Hill, Rooker, and Wimmer, "Kirtland Economy," 389–471.</ref>
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	====Joseph did not profit personally from the bank, and withdrew his support before the failure====		====Joseph did not profit personally from the bank, and withdrew his support before the failure====
	Joseph probably suffered more legal repercussions than anyone from the event. There is no evidence that Joseph was "getting rich," or attempting to do so, from the bank. He paid more for his stock in the bank than 85% of the subscribers, and he put more of his own money into the bank than anyone else, save one person.<ref>Hill, Rooker, & Wimmer, 456.</ref>		Joseph probably suffered more legal repercussions than anyone from the event. There is no evidence that Joseph was "getting rich," or attempting to do so, from the bank. He paid more for his stock in the bank than 85% of the subscribers, and he put more of his own money into the bank than anyone else, save one person.<ref>Hill, Rooker, and Wimmer, "Kirtland Economy," 456.</ref>

	In June 1837, Kirtland land values had increased by 800% in just one year, so the idea of backing the bank with land does not seem unreasonable.		In June 1837, Kirtland land values had increased by 800% in just one year, so the idea of backing the bank with land does not seem unreasonable.

	Furthermore, the bank's weakness became a drain on Joseph, and he expended considerable resources trying to save it—including obtaining three new loans—which only worsened his position in the end.<ref>Hill, Rooker, & Wimmer, 432.</ref>		Furthermore, the bank's weakness became a drain on Joseph, and he expended considerable resources trying to save it—including obtaining three new loans—which only worsened his position in the end.<ref>Hill, Rooker, and Wimmer, "Kirtland Economy," 432.</ref>

	Joseph was left with debts of $100,000. He had that value in goods and land, but it was difficult to convert these to cash. (Ironically, it was this very issue which had led to the bank's formation in the first place.)		Joseph was left with debts of $100,000. He had that value in goods and land, but it was difficult to convert these to cash. (Ironically, it was this very issue which had led to the bank's formation in the first place.)
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	====Joseph fled for fear of his life, but as late as 1843 worked to settle his Kirtland debts====		====Joseph fled for fear of his life, but as late as 1843 worked to settle his Kirtland debts====

	Joseph fled for fear of his life, but also left creditors behind. Admirably, even as late as 1843, he continued to work to settle his Kirtland debts, even though he was far away in Nauvoo and effectively beyond the reach of his creditors.<ref>Hill, Rooker, & Wimmer, 458.</ref> In a 23 June 1874 speech, Brigham Young indicated that "some of his [Joseph's] debts had to be settled afterwards; and I am thankful to say that they were settled up."<ref>{{JDfairwiki\|author=Brigham Young\|vol=18\|start=242\|disc=30}} See also discussion in {{HistoryLDSMissouri-Gentry1\|start=196}}</ref>		Joseph fled for fear of his life, but also left creditors behind. Admirably, even as late as 1843, he continued to work to settle his Kirtland debts, even though he was far away in Nauvoo and effectively beyond the reach of his creditors.<ref>Hill, Rooker, and Wimmer, "Kirtland Economy," 458.</ref> In a 23 June 1874 speech, Brigham Young indicated that "some of his [Joseph's] debts had to be settled afterwards; and I am thankful to say that they were settled up."<ref>{{JDfairwiki\|author=Brigham Young\|vol=18\|start=242\|disc=30}} See also discussion in {{HistoryLDSMissouri-Gentry1\|start=196}}</ref>
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SpencerMarsh at 16:03, 25 June 2026

2026-06-25T16:03:35Z

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	====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====		====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====

	After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>Partridge, 439</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=434}}.</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, 474–475; see also Hill, Rooker, & Wimmer, 434–435.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, & Wimmer 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-367.</ref>		After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>{{BYUS\|author=Scott H. Partridge\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=655 The Failure of the Kirtland Safety Society]\|vol=12\|num=4\|date=Summer 1972\|start=439}}</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=434}}.</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, 474–475; see also Hill, Rooker, & Wimmer, 434–435.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, & Wimmer 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-367.</ref>

	On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, 454.</ref>		On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, 454.</ref>
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	<blockquote>		<blockquote>
	Most economic historians do not believe that banks at that time were usually operated by unprincipled men for selfish ends. More typically, it is the consensus that the instability of bank credit was inherent in the structure of the banking system and involved factors beyond the control of individual banks. The main flaw in state banking in the 1830s was that it was predominantly a rural institution and had little liquidity or shift-ability. In the large cities of the East, loans could be liquidated—that is, turned into cash quickly—by simply calling for payment, but this could not be done in the outlying areas...Thus the reckless and inexperienced management of many state banks was combined with a scarcity of productive commercial loans to create a state banking system with grave weaknesses. As a consequence, most state banks fulfilled their functions at the expense of constant bank failures, violent business fluctuations, and enormous losses to noteholders and depositors.<ref> ~~{{BYUS\|author=Scott H.~~ Partridge~~\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=655 The~~ Failure ~~of the Kirtland Safety Society]\|vol=12\|num=4\|date=Summer 1972\|start=~~446~~\|end=447}}~~</ref>		Most economic historians do not believe that banks at that time were usually operated by unprincipled men for selfish ends. More typically, it is the consensus that the instability of bank credit was inherent in the structure of the banking system and involved factors beyond the control of individual banks. The main flaw in state banking in the 1830s was that it was predominantly a rural institution and had little liquidity or shift-ability. In the large cities of the East, loans could be liquidated—that is, turned into cash quickly—by simply calling for payment, but this could not be done in the outlying areas...Thus the reckless and inexperienced management of many state banks was combined with a scarcity of productive commercial loans to create a state banking system with grave weaknesses. As a consequence, most state banks fulfilled their functions at the expense of constant bank failures, violent business fluctuations, and enormous losses to noteholders and depositors.<ref>Partridge, "Failure," 446–47.</ref>
	</blockquote>		</blockquote>
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SpencerMarsh at 16:02, 25 June 2026

2026-06-25T16:02:26Z

SpencerMarsh at 15:53, 25 June 2026

2026-06-25T15:53:50Z

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	\| title = ===Question: What ~~was~~ the Kirtland Safety Society ~~"anti-bank"~~?===		\| title = ===Question: What is the timeline of the Kirtland Safety Society?===
	\| state = closed		\| state = closed
	\| content =		\| content =
	~~=What is the timeline of the Kirtland Safety Society?=~~
	~~==Timeline of events==~~

	;27 March 1836: Kirtland Temple dedication		;27 March 1836: Kirtland Temple dedication
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	;face value: the specie value marked on scrip. For a $20 note, the face value would be $20.		;'''face value:''' the specie value marked on scrip. For a $20 note, the face value would be $20.
	;note: another term for ''scrip''		;note: another term for ''scrip''
	;redeem: to exchange scrip for specie at the bank		;'''redeem:''' to exchange scrip for specie at the bank
	;specie: hard currency, precious metal coins of accepted value (gold or silver)		;'''specie:''' hard currency, precious metal coins of accepted value (gold or silver)
	;scrip: paper money, issued by a bank. An example of KSS scrip can be seen [http://www.mormonmoney.com/Kirtland%20Anti-Bank%20Notes.htm here].		;'''scrip:''' paper money, issued by a bank. An example of KSS scrip can be seen [http://www.mormonmoney.com/Kirtland%20Anti-Bank%20Notes.htm here].
	;suspension of payment: an indication by a bank that, until further notice, it can no longer redeem its scrip with the face value of specie.		;'''suspension of payment:''' an indication by a bank that, until further notice, it can no longer redeem its scrip with the face value of specie.
	;wildcat bank: a bank established as a money-making scam. "A wildcat bank was one in which the managers of the bank made a deliberate effort to evade paying off notes by making the place of redemption inaccessible to those trying to trade notes for specie".<ref>Partridge, 451</ref> Thus, the bank kept the specie, and the note holder was left with worthless paper which no one would honor, since it could not be redeemed (the bank being located "where the wildcats are"). Such banks usually collapsed quite quickly when it became clear that their notes were not easily redeemed.		;'''wildcat bank:''' a bank established as a money-making scam. "A wildcat bank was one in which the managers of the bank made a deliberate effort to evade paying off notes by making the place of redemption inaccessible to those trying to trade notes for specie".<ref>Partridge, 451</ref> Thus, the bank kept the specie, and the note holder was left with worthless paper which no one would honor, since it could not be redeemed (the bank being located "where the wildcats are"). Such banks usually collapsed quite quickly when it became clear that their notes were not easily redeemed.
	}}		}}
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SpencerMarsh at 15:52, 25 June 2026

2026-06-25T15:52:30Z

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	~~{{To learn more box:Kirtland Safety Society}}{{blankline}}~~

	{{Critical sources box:Mormonism and church finances/Background/Kirtland Safety Society/CriticalSources}}~~{{blankline}}~~		{{To learn more box:Kirtland Safety Society}}


			{{Critical sources box:Mormonism and church finances/Background/Kirtland Safety Society/CriticalSources}}


	{{endnotes sources}}		{{endnotes sources}}
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SpencerMarsh at 15:52, 25 June 2026

2026-06-25T15:52:09Z

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	Joseph fled for fear of his life, but also left creditors behind. Admirably, even as late as 1843, he continued to work to settle his Kirtland debts, even though he was far away in Nauvoo and effectively beyond the reach of his creditors.<ref>Hill, Rooker, & Wimmer, 458.</ref> In a 23 June 1874 speech, Brigham Young indicated that "some of his [Joseph's] debts had to be settled afterwards; and I am thankful to say that they were settled up."<ref>{{JDfairwiki\|author=Brigham Young\|vol=18\|start=242\|disc=30}} See also discussion in {{HistoryLDSMissouri-Gentry1\|start=196}}</ref>		Joseph fled for fear of his life, but also left creditors behind. Admirably, even as late as 1843, he continued to work to settle his Kirtland debts, even though he was far away in Nauvoo and effectively beyond the reach of his creditors.<ref>Hill, Rooker, & Wimmer, 458.</ref> In a 23 June 1874 speech, Brigham Young indicated that "some of his [Joseph's] debts had to be settled afterwards; and I am thankful to say that they were settled up."<ref>{{JDfairwiki\|author=Brigham Young\|vol=18\|start=242\|disc=30}} See also discussion in {{HistoryLDSMissouri-Gentry1\|start=196}}</ref>
	}}

	~~{{PerspectivesBar~~
	~~\|link=http://www.fairmormon.org/perspectives/fair-conferences/2009-fair-conference/2009-the-kirtland-safety-society~~
	~~\|author=R. McKay White~~
	~~\|authorlink=http://www.fairmormon.org/perspectives/authors/white-mckay~~
	~~\|title=The Kirtland Safety Society~~
	~~\|date=August 2009~~
	~~\|publication=Proceedings of the 2009 FAIR Conference~~
	\|summary=The Kirtland Safety Society Anti-Banking Company is an important part of our church history, having, as it did, a significant role in the Kirtland apostasy. Yet, to date, it has received much more attention from anti-Mormons, or “the other guys”, than from our own scholars and apologists. As a result, there are a large number of myths about the Safety Society that the other guys use to criticize Joseph Smith and destroy faith.
	~~<br>~~
	Today, I’m going to lay the episode wide open. We’ll see the myths that have sprung from the creative minds of interested parties, the facts will be laid bare, and in doing so, we’ll see why the Prophet deserves a good name.
	}}		}}

SpencerMarsh at 15:51, 25 June 2026

2026-06-25T15:51:40Z

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	<small>[[Church finances\|Church Finances]] \| <span style="color:#7BB375">Kirtland Safety Society</span></small		<small>[[Church finances\|Church Finances]] \| <span style="color:#7BB375">Kirtland Safety Society</span></small>
	__NOTOC__		__NOTOC__
	<h1><b>The Creation of the Kirtland Safety Society</b></h1>		<h1><b>The Creation of the Kirtland Safety Society</b></h1>

← Older revision		Revision as of 16:02, 25 June 2026
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	====Given that banking was in its infancy, the Saints were not sophisticated in their understanding of how a bank worked====		====Given that banking was in its infancy, the Saints were not sophisticated in their understanding of how a bank worked====

	Even Brigham Young, an astute businessman, was confused. Brigham deposited a note with his mark on it.<ref>{{HR1\|vol=5\|start=433}}</ref> He was shocked to receive the same note in payment from someone else a few days later! It seems that Brigham thought that the bank kept his note for him, and did not allow it to circulate. He thought of a 'bank' as something more like a safe deposit box—one puts their valuables in, and the bank keeps those same valuables safe, does not lend them out, and returns the exact same items back when asked. Brigham did not understand that a bank keeps a record of money deposited, but uses the funds deposited to make loans and investments, and to pay other creditors.<ref>~~See~~ Adams, 475~~–~~476.</ref>		Even Brigham Young, an astute businessman, was confused. Brigham deposited a note with his mark on it.<ref>{{HR1\|vol=5\|start=433}}</ref> He was shocked to receive the same note in payment from someone else a few days later! It seems that Brigham thought that the bank kept his note for him, and did not allow it to circulate. He thought of a 'bank' as something more like a safe deposit box—one puts their valuables in, and the bank keeps those same valuables safe, does not lend them out, and returns the exact same items back when asked. Brigham did not understand that a bank keeps a record of money deposited, but uses the funds deposited to make loans and investments, and to pay other creditors.<ref>{{BYUS\|author=Dale W. Adams\|article=[https://byustudies.byu.edu/showTitle.aspx?title=5600 Chartering the Kirtland Bank]\|vol= 23\|num=4\|date=Fall 1983\|start=475\|end=476}}</ref>

	====In principle, the Kirtland Safety Society was to use land and specie to back its notes====		====In principle, the Kirtland Safety Society was to use land and specie to back its notes====
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	====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====		====The Kirtland Safety Society was reconfigured as an "anti-banking company" after it failed to receive a charter as a bank====

	After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>Partridge, 439</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>Hill, Rooker, & ~~Wimmer,~~ 433~~–~~434.</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, 474–475; see also Hill, Rooker, & Wimmer, 434–435.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, & Wimmer 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-367.</ref>		After failing to receive a charter for a bank, the KSS was hastily reconfigured as "a joint stock association, with limited power to issues notes" called the "Kirtland Safety Society Anti-Banking Company."<ref>Partridge, 439</ref> This so-called "quasi-bank" style of operation permitted a commercial enterprise to effectively function as a bank without a bank charter. Other such quasi-banks were already organized in Ohio before the KSS, and even after the bank failures of 1837 (when Joseph Smith and others were prosecuted for operating an illegal bank), Ohio did little to act against other quasi-banks until 1873.<ref>{{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=433\|end=434}}.</ref> Significantly, though, the KSS also had no corporate charter that could be "interpreted loosely" to allow for banking activities, and some authors regard this as the single biggest reason for its failure,<ref>Adams, 474–475; see also Hill, Rooker, & Wimmer, 434–435.</ref> although others have argued that the KSS was not unique, since "[t]here were other unauthorized banks in Ohio during this period and some encouragement was received from anti-Democratic newspapers to establish such institutions."<ref>Hill, Rooker, & Wimmer 435; citing C.C. Huntington, "A History of Banking and Currency in Ohio Before the Civil War," ''Ohio Historical Quarterly'' 24 (1915): 366-367.</ref>

	On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, 454.</ref>		On 2 January 1837, Joseph also obtained a loan of $3,000 from the Bank of Geauga, a clear sign that non-Mormon bankers did not regard Joseph has over-extended or carrying too much debt.<ref>Adams, 454.</ref>
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	;1 February 1837: KSS notes circulating at only 12.5 cents per dollar face value		;1 February 1837: KSS notes circulating at only 12.5 cents per dollar face value

	;10 February 1837: A second attempt is made to get a bank charter; some non-Mormons are part of this application, including Joseph Smith’s lawyer and Samuel Medary, a future governor of two states.<ref>~~{{BYUS\|author=Dale W.~~ Adams~~\|article=[https://byustudies.byu.edu/showTitle.aspx?title=5600~~ Chartering ~~the Kirtland Bank]\|vol= 23\|num=4\|date=Fall 1983\|start=~~477~~\|end=478}}~~</ref>		;10 February 1837: A second attempt is made to get a bank charter; some non-Mormons are part of this application, including Joseph Smith’s lawyer and Samuel Medary, a future governor of two states.<ref>See Adams, "Chartering," 477–78.</ref>

	; April 1837: Joseph Smith twice warns the Saints that the KSS will fail if the members do not accept the notes as payment for goods and services		; April 1837: Joseph Smith twice warns the Saints that the KSS will fail if the members do not accept the notes as payment for goods and services
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	To finance this explosive growth, loans were sought. Joseph Smith and the Church had extensive loans; some loans were for Joseph, some for Kirtland, and some for the Church. In some instances, Joseph was the only borrower, in other cases he was one among many who were liable for a given debt.		To finance this explosive growth, loans were sought. Joseph Smith and the Church had extensive loans; some loans were for Joseph, some for Kirtland, and some for the Church. In some instances, Joseph was the only borrower, in other cases he was one among many who were liable for a given debt.

	Banks do not loan money to those they consider poor risks, and so to his contemporaries, Joseph clearly appeared to have the ability to meet his obligations. The amount of the loans seems to have been less than the total value of the lands, businesses, and goods which Joseph and the Church owned. However, these assets were difficult to liquefy—the loans were often short-term (from a few weeks to around 180 days) and so cash flow problems beset Joseph continually.<ref>See {{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=389\|end=471}}</ref>		Banks do not loan money to those they consider poor risks, and so to his contemporaries, Joseph clearly appeared to have the ability to meet his obligations. The amount of the loans seems to have been less than the total value of the lands, businesses, and goods which Joseph and the Church owned. However, these assets were difficult to liquefy—the loans were often short-term (from a few weeks to around 180 days) and so cash flow problems beset Joseph continually.<ref>See Hill, Rooker, and Wimmer, 389–471.</ref> {{BYUS\|author=Marvin S. Hill, Keith C. Rooker and Larry T. Wimmer\|article=[http://byustudies.byu.edu/Products/MoreInfoPage/MoreInfo.aspx?Type=7&ProdID=1457 The Kirtland Economy Revisited: A Market Critique of Sectarian Economics]\|vol=17\|num=4\|date=Summer 1977\|start=389\|end=471}}</ref>
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