The Kirtland Safety Society and the Fraud of Grandison Newell: A Legal Examination | BYU Studies

The Kirtland Safety Society and the Fraud of Grandison Newell: A Legal Examination

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The Kirtland Safety Society and the Fraud of Grandison Newell: A Legal Examination

Author Jeffrey N. Walker,

Latter-day Saint leaders founded the Kirtland Safety Society in 1836 to meet the commercial needs of a growing community. They first attempted to obtain a charter for the bank, but the Ohio legislature was uncooperative. They changed the Society to a joint stock company and also allied it with a Michigan bank that was already chartered. For a few weeks, the company generated economic activity in Kirtland and made agreements with agents in other cities.

The Society collapsed because of a nationwide bank failure (the Panic of 1837), accompanied by disagreement among LDS leaders. An attack also came from Grandison Newell, a local competitor of the Mormons, who collected and redeemed banknotes to claim the Society's cash reserves. In 1838, Newell won a lawsuit against Joseph Smith and Sidney Rigdon, claiming that the Society was in violation of 1816 Ohio law, even though 1824 Ohio law should have prevented this action. Newell managed to collect from the property of Smith and Rigdon more than double the amount that was due to him. In 1859-1862, Newell revived the judgment even though it had been settled, claimed he had not received what was due, and was awarded property in Kirtland that included the Kirtland Temple and its land, which was promptly sold. Eventually the temple was sold to the Reorganized Church of Jesus Christ of Latter Day Saints.

This article explains the legal aspects and presents documents of this complicated history. This history shows that Church leaders endeavored to help and protect the Saints, worked through legal channels, and paid all debts. But through many unethical actions Grandison Newell succeeded in his campaign against the Mormons.