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The Mormon Church, officially known as the Church of Jesus Christ of Latter-day Saints (LDS), and its investment firm will pay out $5m (£4.1m) over claims they hid a huge cache of shares.

The LDS and its investment firm, Ensign Peak Advisers, used "shell" companies to hide a $32bn stock portfolio, .

Ensign Peak will pay a $4m penalty and the Church will pay $1m.

Neither has admitted any wrongdoing.

"We allege that the LDS church's investment manager, with the church's knowledge, went to great lengths to avoid disclosing the church's investments, depriving the commission and the investing public of accurate market information," Gurbir Grewal, director of the SEC's division of enforcement, said in a statement.

The financial markets watchdog said the Church and Ensign Peak had used shell companies to conceal growing investments in shares, which had reached more than $30bn in 2018, over fears that it could lead to negative publicity.

The SEC's announcement provided a rare insight into how Ensign Peak allegedly sought to hide a significant part of the Mormon Church's investments.

The Salt Lake City-based adviser, which was founded by the LDS in 1997, created 13 shell companies with locations throughout the US, the regulator said.

Between 1997 and 2019, the shell companies, rather than Ensign Peak, filed quarterly investment disclosures with the SEC, it added.

A shell company is an entity that does not have any active business operations. These types of companies can be used to disguise business ownership from regulators or the public.

The Church has more than 16 million members in more than 30,000 congregations across 160 countries.

Ensign Peak is thought to manage a total of at least $100bn on behalf of the Mormon Church.