Paperwork problems

Two stories have just been hitting the wires from, in some sense, opposite ends of Old Order Amish society.

In Wisconsin, an Amish sawmill owner is having permit issues.  Joni Bontreger was cited for building a sawmill without obtaining a zoning permit. From the story (no longer online):

Borntreger filed a one-page, handwritten note in response saying he didn’t believe he needed a permit because his forefathers didn’t have deal with such regulations.

In an earlier court appearance, others spoke in Bontreger’s defense, arguing that the religion requires simplicity and non-conformity–arguments which swayed the judge in his favor.

In this latest appearance, however, the court “found Joni Borntreger’s arguments too vague to conclude the permit requirements infringed on his beliefs.”

These types of disputes aren’t uncommon in conservative Amish communities, with religious objections presented against state zoning or code requirements.  Bontreger is representing himself, but based on this result could probably use some reinforcements.

Amish & the SEC

The second case is not so everyday, at least for the Amish. The $125 million Amish Helping Fund (AHF)–a nonprofit device used by Amish to provide real estate loans–has been found, from what I can tell, to essentially have out-of-date paperwork.

The SEC alleges that AHF’s offering memorandum, drafted in 1995, was not updated for 15 years and thus contained material misrepresentations about the fund and the securities being offered.

The fund immediately corrected this issue, thus earning it “lenient treatment”–a deferred prosecution deal.  The SEC ruled that none of the 3,500 investors suffered undue harm due to the stale documents.

So this sounds a little like a storm in a teacup.  Obviously the story is getting more airtime because it’s an Amish fund.

I was simply struck by the contrast here–an individual fighting out a religious conscience matter on one side, and an entire Amish financial institution tripped up by a paperwork oversight on the other.

It’s another nice illustration of Amish diversity.  You probably wouldn’t see these two groups of Amish trading places though.

In other words, the folks involved in the Helping Fund are probably the type who are fine with zoning permits.  And the zoning permit Amish are unlikely to be that involved, if at all, with big financial vehicles like the Helping Fund.

Though whatever your stripes, I guess no one gets a pass on paperwork.

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    1. I just filed a nonprofit incorporation and had the initial paperwork returned for a minor detail. The clerk had helpfully noted the problem, so we refiled and received priority response for the same $20 fee. Now I need to file by-laws.

      I am not a lawyer, obviously, but I do have some background in corporate organization. While it is possible to do much of the legal work oneself, the myriad regulatory changes that inevitably get passed often go by the non-lawyer.

    2. I can understand someone being a little confused when it comes to dealing with local-state-and government regulations because I’m confused myself at times as well. I’ve read that when new laws are added or even changed instead of re-writing that law its just piled on the existing law making it even that more confusing with even more paper work to read through. But they are our laws and somehow we must try and somehow adhere to their very principles as it was intended. I wish that Amish fellow much luck because I think he’s got an uphill battle on his hands, and I’m sure that he’s now learning that our laws have no grey area only black and white. That’s my 2 cents anyway, which will be taxed after I post this comment! Richard.

    3. Diane Paulson

      Big Government

      As big and bigger government seems to be the goal of this administration, it doesn’t surprise me that the independent Amish are being cited. God preserve and help them as long as possible, but I can’t imagine it’s going to be any easier in the future, as socialism is forced on our freedoms. Remember that, and help to turn the tide.

    4. Katrina

      “We’re from the government and we’re here to help”.

      1. Lance

        Too bad there has not been a presidential candidate since 1980 to remind us that those 9 words are the scariest 9 words ever spoken.

    5. Laura

      My job is transcribing many different types of government hearings/meetings, and one thing I’ve transcribed many, many times are SEC depositions and meetings, and also Tax Court hearings, for over 25 years now. And I have to tell anybody who thinks the government is just now picking on the Amish as a religious group that they’ve been looking at religious-oriented and religious-run funds for many years now. Unfortunately, many times people are more trusting because their religion is invoked and so they invest in what is really a ripoff or even a Ponzi scheme (where the money from new investors goes to pay off older investors, thus requiring more and more investors to keep the scheme going).

      In this case, I truly believe that the SEC is trying to help religious groups by making sure they do everything correctly so they don’t end up taking advantage of their investors. I’m not saying this is the case for the Amish, but I’ve seen it happen many times over the years. Even religious groups have to follow the law when it comes to investments, for the protection of their investors! It sounds to me like the SEC in this case helped the Amish fund get its paperwork straight and was extremely lenient with them rather than punitive.

      As for the sawmill owner, that’s a tougher one. But don’t the Amish believe in following the laws of the land? It seems to me that if the law now requires certain paperwork for a business, just because the business is Amish doesn’t mean they don’t have to do it. Times change, and government rules change, not just for the Amish but for everybody; I doubt that the Amish sawmill owner is being asked to do anything that any English person in his position would also be required to do. Just my opinion, obviously.

      1. Laura, thanks for sharing this insight here. It seemed like a pretty generous response to me as well, given the alternative of coming down hard.

      2. Earl


        Amish, old order or new,they all think they are exempt from the Rules of the land and road. I am sick and tired of them playing the religious card,it is really getting redicious. In every town, township, or city there are permits required for construction, and this means everyone, not a select few. So, if the Amish want non-conformity, maybe they better move to another Country, because the USA has Laws that must be followed by all!

    6. OldKat

      Catch 22?

      I think that laws and regulations are something of a two edged sword. On the one hand if we don’t have laws, rules, regulations etc in place to prevent it; even day to day life in a modern society could become chaotic. On the other hand; over-regulation, ill advised laws and bureaucratic red tape can stifle creativity and bog down initiative.

      There is no doubt and it is very clear that we have added hundreds and thousands of new local, state and federal laws and regulations over the past 4 or 5 decades or more. What is considerably less clear is: are they all needed? Do they do what they are supposed to do, or, are they counter productive?

      Several years ago a friend of mine who has relatives in New Zeeland told me that as a nation they had gotten so bogged down in such bureaucratic malaise and onerous regulations (not to mention socialist entitlements) that their economy was on the verge of total collapse. (Much like some people claim ours is now). He said that they took a good hard look at every law, rule, and regulation in place and asked: “Do we really need this? Does it help or hinder? Does it do what it was designed to do?” If the answer was that it wasn’t clear if it was actually needed or it wasn’t clear that it was actually working they scrapped it. Same with any and all government “help” programs.

      Now, I never checked his story out to see if it was really true or not. However, several months ago I noticed that one organization which ranks such things listed them as having the most economic freedom and opportunity of any nation in the world. Hmmm, if his story is legit it tends to make ‘ya think. Just within the past couple of weeks I saw a news story that listed New Zeeland as having the highest standard living of ANY nation. Now I am always skeptical of such rankings as the criteria one organization uses to establish its rankings can differ greatly from that used by others doing the same rankings. The criteria used can also be extremely subjective at times, but it got my attention nevertheless. I think the U.S. came in about 13th place in their ranking. Hmmm, is there a correlation?

      1. Ed

        Old Kat, your friend is absolutely correct, in the 1980’s New Zealand went through some incredible economic changes, a daring move for a small country.

        If you ever have the pleasure of visiting New Zealand, as I have, you’ll find that it is among the friendliest and most charming nations on earth.

    7. Ana Sweet

      When money is involved, such as the lending group, the Amish are not immune to fraud. A lot of this regulation is due to previous frauds, remember Enron, and was done to protect consumers.

      It may have unintended consequences to some but that is the price paid for “protection”.

    8. Ed

      Erik, I couldn’t view the link to the article about the “helping fund”. But your post brings up a lot of questions to me. Who are the 3,500 initial investors? Is this a fund that returns an annual dividend to them, or more like a perpetual fund where any profits are reinvested back in? Was an offering of shares made to the public in the 1990’s? How many among the Old Order Amish participate in this fund? I know that many Amish have bank accounts, but do some limit their involvement in the financial world to Amish-run funds like this?

      I’m glad the fund immediately corrected its paperwork issue. I think that when $125 million is at play, having proper internal controls (and hiring specialists to follow appropriate regulations) is essential. Where money is involved corruption can follow, no matter how well-intentioned the purpose.

      Regarding the sawmill owner: I feel for him. Zoning issues and land use restructions have gotten out of hand in my opinion. I think the Amish can lead us out of the mess, to remind us that not every plot of land should contain cookie-cutter houses or office parks. I don’t think this is a ‘religious liberty’ issue so much as a common sense one. I hope the zoning board is listening.

      1. How do Amish mortgage funds work?

        Hi Ed, sorry about that, just fixed the link. I don’t have answers to all your questions, but these are primarily if not exclusively Amish investors; the fund is a nonprofit, and there are versions of them in a number of communities. I’m not exactly sure how this one is set up, but another one I am aware of operates as a revolving fund with investors getting some returns and it’s probably a similar setup here.

        The “offering memorandum” mentioned here I believe is what is used for private bodies and is different (at least in name if not in form) from the prospectus which is required for SEC registered public offerings.

        Some Amish are comfortable in investing in conventional financial vehicles as well; some folks are more comfortable with traditional investments like land, and if they are going to put money in a fund, something like this which benefits their communities, and is run at a low overhead by their own people, would appeal. That said, the former treasurer of the Amish Helping Fund is the same Amishman who was sentenced for fraud in the recent Ohio investment fund case.

        As for how many are involved, this fund serves around 1,200 borrowers according to the article (along with the 3,500 investors). You can extrapolate out a little from there knowing that a number of the larger communities like Lancaster, Geauga Co. and Nappanee also have similar funds.