Lovinglife625
Patron with Honors
From a posting I just did on another forum:
http://exscnforum.com/index.php/organized-scientology-filings-time-little-truth-t142.html
"Warning – Wall of Text Follows:
Two things that historically motivated organized scientology to carry out new corporate reorganizations were fear of damages from civil litigation and fear of government departments (like the IRS) seizing their assets and/or charging their executives through criminal action.
Both were the major factors in the “corporate sortout”, the major corporate reorganization of the early 1980s which led to entities like CST, RTC, CSI, FSO, new trusts, etc.
I have covered much of this in an affidavit, in an ebook, in various postings and in a number of audio and video recordings.
I won’t repeat all that again but I did want to point out one thing now that some attention is being given to their filings with the IRS in the early 1990s that had to do with the flow of monies and the control of same within organized scientology. Much of what they filed with the IRS contained outright lies or otherwise distortions to cloud the whole truth.
Here is the simple bottom line of what the scene was before and after the corporate sortout with respect to the flow and control of the monies of organized scientology.
Just prior to the corporate sortout that started in late 1981 I did an evaluation of the corporate structure of organized scientology, how so much was based on lies and what could be done to correct it. That evaluation went to Miscavige and, I am told, Hubbard. I was then put on the corporate sortout mission and what I did is covered in many postings/recordings mentioned above.
One of the big potential legal liabilities confronting organized scientology was that, despite separate legal entities, it was centrally controlled and run almost as if it were one big, international unincorporated association managed from the GO and CMO, then just the CMO as of mid 1981.
Management would constantly take the vast sums of monies most orgs made each week with little to no significance put on why it was being taken. Through finance networks money could and would be taken off the top weekly and sent to management. Clearly the corporate veils were highly transparent and there was a great danger that management would be pulled into legal suits and other actions because of their obvious unbridled control of not only the lower organizations but of their money which they took weekly at will.
That this was a problem was magnified by the fact that by 1981 there were major legal damages cases trying to pierce the corporate veils which we thought might very well drag top management and the money they took from the orgs into the cases. This was considered very serious especially as much of management, including some of the biggest orgs on the planet, were part of one corporation the Church of Scientology of California (“CSC”).
So, given the fact that management was in CSC and CSC was ripping off most of the lower orgs’ monies, CSC, its executives and the money it held was exposed to significant legal liability.
All this is gone into in much more detail in other of my writings but I mention the above to try to put into a proper context the following.
If you follow declarations Miscavige and others in management have made in courts and their filings to the IRS in the early 1990s you would think there was some big change in the early 80s and there was indeed some real arms length with local corporate boards making their most major financial decisions and a central management no longer just ripping off money from the lower orgs. Furthermore you will get the idea that organized scientology is no longer centrally controlled as different “high up” bodies like RTC, CSI and CST exist each substantially independent of the other with Miscavige himself not even involved until he got into RTC in 1986.
Nothing can be further from the truth.
Recognizing the dangers posed above, what the early 1980s corporate sortout did, simply put, was millions of dollars of window dressing to ensure they could keep the same central control in but to completely mask it in legal entities and significances.
For example, as I mentioned earlier, prior to the sortout management often just took the money they wanted from the orgs by force whether it was the Assistant Guardian Finance doing it for GO purposes or the Flag Banking Officer or other treasury executive doing it for the Sea Org. All the early 1980s sortout did was implement various agreements and legal significances to try to “justify” the taking of the same monies from the lower orgs. Various corporations, trusts, contracts and forms of billings were designed to make it LOOK LIKE the transactions (IE: the taking of the lower orgs’ money) were at arms length.
Examples of this were things like:
1) a films trust created to get 5-10% of orgs’ income weekly as part of “leasing” all the dissemination/training films they used;
2) very steep, but we thought legally justifiable, fees and bills were created for all sorts of management actions including missions to the orgs, evaluations, you name it;
3) orgs would be made to pay for “joint actions” such as major dissemination campaigns that were meant to help all orgs;
4) in the case of more advanced orgs, there were licensing fees for the use of the “advanced technology”;
5) maximum prices were charged for books, emeters, course packs and other materials;
6) later one or more trusts controlled by management (for example CSRT) would hold mortgages for real properties of some of the orgs and get the money payments for same;
7) etc., etc., etc.
Central control of money by top management for the entire scientology enterprise did not change at all with the corporate reorganizations. It was just far better hidden. I know this as I was the one to present the major corporate reorg planning to Miscavige to get approval of it. I then had to go to the Int base and explain it to several top WDC members such as the then WDC Chairman and CO CMO Int Marc Yager and WDC Reserves Mark Ingber. As part of the many hours I spent with them on this I had to field easily more than 100 questions of how they could continue to control things, especially the taking and keeping of money from all of corporate scientology, just like before. This is not an opinion. It is simple fact. Policy they followed “religiously” was to take all possible money from the orgs before they could spend it.
Sadly this left no money for things like a decent wage, retirement, food, clothing, child care, medical, dental, you name it. Those were not factors at all to top management who just wanted all the money they could get.
The same sorts of controls went in throughout the entire scientology corporate empire including all kinds of fees and charges to other groups such as missions, field auditors, WISE, Narconon, the “study tech” groups, etc.
New and creative ways to get more money out of the public were also created, the best example being the IAS. I have covered this in some detail in various postings found on my blogspot.
All kinds of window dressing was put into place following the major corporate reorganization of the early 1980s such as companies to do administrative works for IAS so as not to domicile IAS anywhere for tax purposes, trusts set up to hold various orgs’ advanced payments to keep the monies away from the likes of damages claimants or tax agencies, etc.
The lies that organized scientology told the IRS about the reasons behind who controlled the money and the reasons for the various entities were epic in scale.
Even money to Hubbard as part of the sortout was dramatically increased in 1982 to some $40,000,000+ with all sorts of legal significances put on the payments, whereas in years previously a million or two were taken now and again without any legal significance at the time. Corporate integrity actually got worse after the sortout but organized scientology created many papers trails and produced much false testimony to make it look otherwise.
IMO we were very good at making it look like a major change occurred and corporate integrity was in to those who were not in the know. But the truth is there was no improvement in corporate integrity or change in control of organized scientology despite many millions of dollars in corporate reorganization beyond the fact that it got even worse under Miscavige who assumed complete dictatorial control of organized scientology and its monies.
The very fact that David Miscavige could not restrain himself from brutally taking over and abusing the senior most people in the different corporations of scientology will in my opinion be some of the best evidence for piercing corporate veils used in current and future legal actions against his lies, abuse and fraud.
The ebook I wrote covering Miscaviges perjuries in trying to cover this all up is available free of charge to anyone who wants to read it: http://tinyurl.com/LHBvol1
My affidavit covering this and more can be found at: http://evil.scientology.googlepages.com/crs.pdf
An old posting I did once on the real power behind organized scientology and the real secretive controls behind it can be found at: http://tinyurl.com/3b8ome
One of a variety of recordings of me going over many details on the above can be found at:
Nov 8, 2007 - radio interview on The Edge:
Transcripts with links to interviews:
(i) http://www.lermanet.com/audio/larry-brennan.htm
(ii) http://xenutv.wordpress.com/2007/11/09/the-edge/
Links to this interview heard on YouTube:
part 1: http://www.youtube.com/watch?v=vK78HgcQmRg
part 2: http://www.youtube.com/watch?v=YyRdXhrHM78
part 3: http://www.youtube.com/watch?v=aK4FRX3mTLg
part 4: http://www.youtube.com/watch?v=64bOLUbU8VM
part 5: http://www.youtube.com/watch?v=Sz49v7S112U
part 6: http://www.youtube.com/watch?v=FMAZYV2E64g&NR=1
My blogspot which contains much more information on secret controls, the real reasons behind RTC, CST, CSI. Wise, IAS, ABLE, CSRT and more can be found at:
http://larrybren.blogspot.com
Sorry again for a major wall of text. I just wanted to focus for a moment on this point due to the various postings on various forums recently about their filings with the IRS which paint a very false and misleading picture of the control of finances and the like within organized scientology.
Larry Brennan"
http://exscnforum.com/index.php/organized-scientology-filings-time-little-truth-t142.html
"Warning – Wall of Text Follows:
Two things that historically motivated organized scientology to carry out new corporate reorganizations were fear of damages from civil litigation and fear of government departments (like the IRS) seizing their assets and/or charging their executives through criminal action.
Both were the major factors in the “corporate sortout”, the major corporate reorganization of the early 1980s which led to entities like CST, RTC, CSI, FSO, new trusts, etc.
I have covered much of this in an affidavit, in an ebook, in various postings and in a number of audio and video recordings.
I won’t repeat all that again but I did want to point out one thing now that some attention is being given to their filings with the IRS in the early 1990s that had to do with the flow of monies and the control of same within organized scientology. Much of what they filed with the IRS contained outright lies or otherwise distortions to cloud the whole truth.
Here is the simple bottom line of what the scene was before and after the corporate sortout with respect to the flow and control of the monies of organized scientology.
Just prior to the corporate sortout that started in late 1981 I did an evaluation of the corporate structure of organized scientology, how so much was based on lies and what could be done to correct it. That evaluation went to Miscavige and, I am told, Hubbard. I was then put on the corporate sortout mission and what I did is covered in many postings/recordings mentioned above.
One of the big potential legal liabilities confronting organized scientology was that, despite separate legal entities, it was centrally controlled and run almost as if it were one big, international unincorporated association managed from the GO and CMO, then just the CMO as of mid 1981.
Management would constantly take the vast sums of monies most orgs made each week with little to no significance put on why it was being taken. Through finance networks money could and would be taken off the top weekly and sent to management. Clearly the corporate veils were highly transparent and there was a great danger that management would be pulled into legal suits and other actions because of their obvious unbridled control of not only the lower organizations but of their money which they took weekly at will.
That this was a problem was magnified by the fact that by 1981 there were major legal damages cases trying to pierce the corporate veils which we thought might very well drag top management and the money they took from the orgs into the cases. This was considered very serious especially as much of management, including some of the biggest orgs on the planet, were part of one corporation the Church of Scientology of California (“CSC”).
So, given the fact that management was in CSC and CSC was ripping off most of the lower orgs’ monies, CSC, its executives and the money it held was exposed to significant legal liability.
All this is gone into in much more detail in other of my writings but I mention the above to try to put into a proper context the following.
If you follow declarations Miscavige and others in management have made in courts and their filings to the IRS in the early 1990s you would think there was some big change in the early 80s and there was indeed some real arms length with local corporate boards making their most major financial decisions and a central management no longer just ripping off money from the lower orgs. Furthermore you will get the idea that organized scientology is no longer centrally controlled as different “high up” bodies like RTC, CSI and CST exist each substantially independent of the other with Miscavige himself not even involved until he got into RTC in 1986.
Nothing can be further from the truth.
Recognizing the dangers posed above, what the early 1980s corporate sortout did, simply put, was millions of dollars of window dressing to ensure they could keep the same central control in but to completely mask it in legal entities and significances.
For example, as I mentioned earlier, prior to the sortout management often just took the money they wanted from the orgs by force whether it was the Assistant Guardian Finance doing it for GO purposes or the Flag Banking Officer or other treasury executive doing it for the Sea Org. All the early 1980s sortout did was implement various agreements and legal significances to try to “justify” the taking of the same monies from the lower orgs. Various corporations, trusts, contracts and forms of billings were designed to make it LOOK LIKE the transactions (IE: the taking of the lower orgs’ money) were at arms length.
Examples of this were things like:
1) a films trust created to get 5-10% of orgs’ income weekly as part of “leasing” all the dissemination/training films they used;
2) very steep, but we thought legally justifiable, fees and bills were created for all sorts of management actions including missions to the orgs, evaluations, you name it;
3) orgs would be made to pay for “joint actions” such as major dissemination campaigns that were meant to help all orgs;
4) in the case of more advanced orgs, there were licensing fees for the use of the “advanced technology”;
5) maximum prices were charged for books, emeters, course packs and other materials;
6) later one or more trusts controlled by management (for example CSRT) would hold mortgages for real properties of some of the orgs and get the money payments for same;
7) etc., etc., etc.
Central control of money by top management for the entire scientology enterprise did not change at all with the corporate reorganizations. It was just far better hidden. I know this as I was the one to present the major corporate reorg planning to Miscavige to get approval of it. I then had to go to the Int base and explain it to several top WDC members such as the then WDC Chairman and CO CMO Int Marc Yager and WDC Reserves Mark Ingber. As part of the many hours I spent with them on this I had to field easily more than 100 questions of how they could continue to control things, especially the taking and keeping of money from all of corporate scientology, just like before. This is not an opinion. It is simple fact. Policy they followed “religiously” was to take all possible money from the orgs before they could spend it.
Sadly this left no money for things like a decent wage, retirement, food, clothing, child care, medical, dental, you name it. Those were not factors at all to top management who just wanted all the money they could get.
The same sorts of controls went in throughout the entire scientology corporate empire including all kinds of fees and charges to other groups such as missions, field auditors, WISE, Narconon, the “study tech” groups, etc.
New and creative ways to get more money out of the public were also created, the best example being the IAS. I have covered this in some detail in various postings found on my blogspot.
All kinds of window dressing was put into place following the major corporate reorganization of the early 1980s such as companies to do administrative works for IAS so as not to domicile IAS anywhere for tax purposes, trusts set up to hold various orgs’ advanced payments to keep the monies away from the likes of damages claimants or tax agencies, etc.
The lies that organized scientology told the IRS about the reasons behind who controlled the money and the reasons for the various entities were epic in scale.
Even money to Hubbard as part of the sortout was dramatically increased in 1982 to some $40,000,000+ with all sorts of legal significances put on the payments, whereas in years previously a million or two were taken now and again without any legal significance at the time. Corporate integrity actually got worse after the sortout but organized scientology created many papers trails and produced much false testimony to make it look otherwise.
IMO we were very good at making it look like a major change occurred and corporate integrity was in to those who were not in the know. But the truth is there was no improvement in corporate integrity or change in control of organized scientology despite many millions of dollars in corporate reorganization beyond the fact that it got even worse under Miscavige who assumed complete dictatorial control of organized scientology and its monies.
The very fact that David Miscavige could not restrain himself from brutally taking over and abusing the senior most people in the different corporations of scientology will in my opinion be some of the best evidence for piercing corporate veils used in current and future legal actions against his lies, abuse and fraud.
The ebook I wrote covering Miscaviges perjuries in trying to cover this all up is available free of charge to anyone who wants to read it: http://tinyurl.com/LHBvol1
My affidavit covering this and more can be found at: http://evil.scientology.googlepages.com/crs.pdf
An old posting I did once on the real power behind organized scientology and the real secretive controls behind it can be found at: http://tinyurl.com/3b8ome
One of a variety of recordings of me going over many details on the above can be found at:
Nov 8, 2007 - radio interview on The Edge:
Transcripts with links to interviews:
(i) http://www.lermanet.com/audio/larry-brennan.htm
(ii) http://xenutv.wordpress.com/2007/11/09/the-edge/
Links to this interview heard on YouTube:
part 1: http://www.youtube.com/watch?v=vK78HgcQmRg
part 2: http://www.youtube.com/watch?v=YyRdXhrHM78
part 3: http://www.youtube.com/watch?v=aK4FRX3mTLg
part 4: http://www.youtube.com/watch?v=64bOLUbU8VM
part 5: http://www.youtube.com/watch?v=Sz49v7S112U
part 6: http://www.youtube.com/watch?v=FMAZYV2E64g&NR=1
My blogspot which contains much more information on secret controls, the real reasons behind RTC, CST, CSI. Wise, IAS, ABLE, CSRT and more can be found at:
http://larrybren.blogspot.com
Sorry again for a major wall of text. I just wanted to focus for a moment on this point due to the various postings on various forums recently about their filings with the IRS which paint a very false and misleading picture of the control of finances and the like within organized scientology.
Larry Brennan"
