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Well (and again, this could have changed) we had a granddaughter of the LDS Prophet in our chapter and there was another granddaughter in another chapter, as well as a lot of Sigma Chis who went on to be bigwigs in the church, so I don't think it was that frowned upon. I do think that Greek membership at a school outside of Utah, where the prevailing culture is so much different (in most sorority chapters you would have 50% at least non-drinking members, for instance, which I don't think is the case at the other schools I have seen), would probably be more inconsistent with LDS beliefs.
I think Utah's much bigger problem is its status as a commuter school. The large majority of its students are from Salt Lake City or the surrounding suburbs, and many of them live at home and do not get involved in campus life in general. The Greek population consisted of either students whose parents and siblings had also been involved in Greek life and so had a strong tie to it or people like me who came from out of state and were looking for a home away from home. But it was really hard to keep even the people who lived in Sandy (a suburb) and joined a sorority to stay involved, if you could even get them interested in the first place.
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