Annotations to Council for Spiritual Integrity document

As posted to alt.religion.scientology

Note:
The following comments, clarifications and open-ended questions formed the bulk of the discussion on this document after it was posted to alt.religion.scientology by Zed. For clarity, I have removed the original text, so readers can jump back and forth from the document to tbese annotations, or read the entire article without extraneous noise.
The two parties involved in the discussion are Zed (zed@magna.com.au ) and the editor of this webpage (tallulah@storm.ca ). If you have any comments to add, please send them to me at the above address.

 

1.   Tallulah:
This introduction seems pretty self-explanatory. The author would seem to have grave misgivings about the direction taken by Scientology, Inc. (for want of a better term) since the Miscavige takeover of 1981/82. My guess would be that the intended audience is one of former scientologists currently operating outside the offiical structure, as well as disgruntled current members, but that's just conjecture. There is a freezoney feel to the whole approach.

Zed:
Most of the information available about Miscavige's coup comes from Freezoners. I'd say this is no exception. My gut reaction is that it was written by someone who'd tried to figure out why the Church had suddenly gone sour in the '80s (at least from their point of view), investigated a little, and is now reporting their findings to this "Council for Spiritual Integrity", whatever that is/was.
The writer also describes the sudden expansion of "squirrel" groups as current, and having no parallel in the Church's 30-year history.I'd say it was written some time around 1983-1985.

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2.  Tallulah:
Summary for those who gave up after the fourth incomprehensible acronym :
CSC, the original "mother church", was getting itself into legal hot water due to the many branches of the CoS that were nestled under its oversight, including the powerful Watchdog Committee and Commondore Message Office, Flag Land Base, the other major American and UK orgs, and our old friends at the Guardian's Office.

Zed:
Lying to tax collectors wasn't helping either. The UK branch of CSC told the British tax people "The UK branch is a part of CSC in America, so it doesn't have to pay taxes to you". CSC in America was telling the American tax people "The UK branch isn't a part of CSC in America, so it doesn't have to pay taxes to you". It was only a matter of time before someone noticed that the UK branch wasn't paying taxes to _anybody_.

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3.   Tallulah:
Michael Flynn, attorney for many anti-scn litigants during this time, was making some gains in nailing CSC for damages, putting the bulk of CoS assets at risk.

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4.   Tallulah:
This seems to suggest that, in order to stave off the seemingly inevitable legal juggernaut headed straight for the CoS jugular. the only recourse for management was to -- go legit. Interesting strategy.

Zed:
Desperate times call for desperate measures I guess. There was also the matter of sweeping past problems and misdeeds under the rug, such as the Religious Research Foundation (RRF) - a sham corporation which probably deserves an entire separate post itself.

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5.   Tallulah:
DM, the Broekers, and a team of GO officials with some legal training plotted the corporate restructuring, which was basically a surprise to the rest of the organization when it became public knowledge after being put into effect.

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6.   Tallulah:
Going by dollar figures alone, at this time, the now extinct Religious Research Foundation was the most powerful, or at least asset-rich corporate entity, followed by CSC. (Question - what became of the RRF?)

Zed:
The most asset-rich, yes. The RRF was set up to accept money from non-US Scientologists taking courses on the Flag Ship when Hubbard was sailing around, and later from non-US citizens taking courses at the Flag Land Base. This was supposed to prevent the money ever being subject to tax in the US (the RRF was set up in Luxembourg, and the money it received from non-US citizens was sent directly to RRF without ever technically entering US jurisdiction).

It's gone now apparently. Liquidated, or something.

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7.   Tallulah:
Okay, more names for the soup. We know all about Spurlock (well, at least we know something about him.) What about Steve Marlowe, Tom Small and Christopher Cobb?

Zed:
No idea. I recognise the attorneys from recent lawsuits, but that's about it.

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8.   Tallulah:
So the chain of command for the restructuring went like this:
Marlowe was in charge of the day to day operations and actual re-organization. He reported to Terri Gamboa, who reported directly or indirectly to David Miscavige.
I find myself becoming more and more curious about Terri Gamboa. Since she was on the 1992 Enemies List, I'm guessing she is outside of the CoS, as reported in Chris Owens' essay, and contrary to the CST summary given in the court case CST vs. IRS. If she's out there, I'll bet she has a lot of insight into the organizational monkey business surrounding the 'Great Renaming' of the early 80s.

Zed:
Agreed. The trick is trying to find her. For a high-level defector, she hasn't shown up much.

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9.   Tallulah:
Hmmm?
Now, math may not be my strong suit (as an endless parade of traumatized former highschool teachers can attest), but it seems to me that the breakdown of known assets per organization only totals to $30 million or so. Where the heck are the rest of those assets? And what entities control the various trusts themselves? Is this done through DM as head of RTC, or some other financial officer?

Zed:
The money could be in the corporate shells labelled with a (??). It could also be in another shell altogether - one that isn't listed here.
Although I'm hesitant to trust information given by the Co$ to the IRS, there's a listing of groups given in an IRS 1023 form which was posted by Jeff Jacobsen. The only trust that shows up that's also listed here is the Church of Scientology Religious Trust. The trustees are Jonathan Epstein, Allen Hubbert and Cal Cole. I vaguely know the first two names, but not the third. The IRS info also lists the Trust for Scientologists, The United States Parishioners Trust, the Flag Ship Trust and the Scientology International Reserves Trusts. I may have missed a few.

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10.   Tallulah:
How much money would be taken in through ROS payments annually, roughly? And is CSRT still active today? Who cuts the cheque for CSI?

Zed:
CSRT is still active. "SOR" payments stands for Sea Org Reserve payments. A Scn finance policy calls SOR "money collected over and above expenses that is sent by various units (via FBOs and the Finance Network) to central reserves bank accounts of Scientology corporations and trusts". As near as I can tell, all Scientology orgs throughout the world have to give a cut of their income as "SOR payments".

Apparently all SOR payments were originally paid to CSRT in order to fund CSI. That may have changed with the proliferation of new trusts recorded by the IRS.

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11.   Tallulah:
So (if I have this correctly) this would suggest that, at this time, satellite accounts were being 'raided' by GOWWW for its own pursuits. When GO 'disbanded', did WDC cum OSA take over that practice? Who pays for OSA today?

Zed:
Possibly. I think the important detail is that MOWW wasn't getting any income from the Church to cover their expenditures. This is a little tricky - Warrior's made reference to something called "GO reserves". I _think_ that before the GO "cleanup", a cut of the income from orgs was sent to GO reserves. These "GO reserves" _might_ have been controlled by MOWW, but I'm not certain.

MOWW was responsible for funding GOWW, apparently.

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12.   Tallulah:
It was permitted to keep some funds *until* it lost the farm in Wollersheim I, at which point it was pillaged, all assets being transferred to ... where? RTC? CST? Anyone know?

Zed:
Larry Wollersheim has written some info about this, I think. I'll check.

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13.   Tallulah:
Well, gosh. I'm no tax expert, but it seems that the Liberian incorporation would make it very likely that RRF was a tax shelter, not to mention a black hole into which any amount of money could be poured, with no indication of where it went after entering the RRF coffers. How handy.

Zed:
Exactly.

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14.   Tallulah:
Hee. How cute. I wonder if there are any "thetan corporations" that are currently active?

Zed:
Possibly. Going through some of the lesser-known corporate shells may reveal something.

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15.   Tallulah:
And, if I'm reading this correctly, it would *also* mean that, as a CSC asset, RRF would also be earmarked to pay for damages incured during civil suits - Wollersheim, for example. Of course, the big question is where the money went when the CSC was exsanguinated.

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16.   Tallulah:
"Is" actively gathering data? This suggests that this document was written before 1991. Is there any mention of RRF (or CSRT, for that matter) in the formerly secret agreement?

Zed:
Probably written in the early- to mid-1980's when the movement to splinter groups was at its height.

CSRT is mentioned in the IRS agreement. They're tax exempt on the basis of section 509(a)(3) of the Internal Revenue Code. This means that CSRT is supposedly operated exclusively for and by a Church or religious organisation, and therefore gets tax exemption. (It's more complicated than that, but it'd take far too long to explain, and this post is long enough already.). CSRT is also one of the Corporate Members of the Church Tax Compliance Committee(CTCC).

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17.   Tallulah:
Cute. So the orgs send all their cash to CSI, which puts it into a big pot called CSRT, which then dispenses money for management and legal matters. How much of a nest egg does CSRT have, at any given time? How often are payments made? Monthly? Quarterly?

Zed:
Warrior had to fill out the finance reports for his org. He says he did it weekly.

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18.   Tallulah:
Ooh, I wouldn't bet on it.

BPI sounds suspiciously like ASI from this description - another "for profit" head of the hydra that didn't quite work out as anyone hoped. I'd love to see some of the records from legal battles between the staff and management. Unionized staffers, quel horreur :). The labour board may have some of these cases on file; and they would make fascinating reading, I'm guessing.

Someone had been looking into the possibility that the COS was jiggering booksales. Perhaps this would be of interest to whoever it was that was pursuing that possibility. It doesn't sound illegal, but I can imagine that some orgs might resent having books "bought" at BPI's request, on their dime.

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19.   Tallulah:
Is this what is claimed, in the agreement that eventually was reached with the IRS? Note - I'm going on the assumption that when potential IRS implications are mentioned in this document, it is in terms of orthodox operating procedure for tax exempt religious organizations, not necessarily those that were eventually reached with the CoS.

Zed:
Cracking the code on the IRS agreement is proving tough, but it appears to me that the various trusts which manage the Co$ moneypool are considered legally independant entities. I may change my opinion if I can get my head around the whole "self dealer" concept.

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20.   Tallulah:
Anyone got a fix on where Wendle might be today?

Zed:
"Wendle" is another of those incorrect spellings that seem to crop up in Scn writings. I've seen her name spelled as "Wendall". This is also incorrect. Her correct name is "Wendell Reynolds". Current location - uncertain.

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21.   Tallulah:
Again, note the era - pre-renaming. When the CoS entered this cash crunch, then, the answer was to shift the corporate structure. How exactly that resulted in more money, I'm not entirely sure.

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22.   Tallulah:
Is BPI currently a for-profit organization?

Zed:
It's tax exempt.

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23.   Tallulah:
A laundry list of interesting, if as yet unproven, charges. But the thesis is clear - the author of this document believes that the trusts were being improperly used, by trustees that may have been appointed in an irregular fashion. Who were these trustees? And where was the money supposedly going?

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24.   Tallulah:
Ding ding ding. Finally, a motive for this document becomes clear - and thank goodness, it's at least a *familiar* conspiracy theory. It is alleged, then, that the org reserve funds are, through the myriad of trusts, being raided for the benefit of certain individuals, possibly Miscavige and the Broekers.

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25.   Tallulah:
It would help if we knew the voting members, board members and officers of these corporations. I notice that CST is first on the list of "key Church corporations" that might be afflicted with these - irregularities, and I'm painfully aware that tracking down the current directors and trustees of that corporation is considerably easier said than done. What about the rest? Anyone have that info handy?

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26.   Tallulah:
What relationship does/did Starkey have to CST?

Zed:
I don't know. I don't know of any relationship to Vickie Azneran,either. Jon Zegel described David Miscavige as a trustee of CST at one point.

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27.   Tallulah:
Oh my good gods; if anyone has plowed through this document to this point, could you please enlighten me as to what this graph illustrates? Org charts aren't my forte under the best of circumstances, but with the combination of spatial relations and bad scan quality, it may as well be ancient sanskrit.

Zed:
It's beyond redemption, IMHO. There's enough here to keep someone occupied for months. I've limited my responses to what I can comment on, and employed some ruthless snipping to keep the size of the post down. Hopefully the document can prove to be of help to someone.

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