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Scientology’s secret riches revealed (AU)

Anonycat

Crusader
THE Church of Scientology netted close to $30 million from religious audits, book sales and donations in the two years following the launch of a major new base in Melbourne.

The opening of the multi-million dollar facility in Ascot Vale at the start of 2011 also lead to a 35 per cent surge in people completing Scientology courses but interest has since tempered, financial records show.
The rare insight into the finances­ of the highly secretive organisation came as it filed annual reports with the Australian Securities and Invest­ments­ Commission.

The Church of Scientology Australia changed its corporate structure in 2011, prompting the need for it to file accounts.
Despite the lucrative revenue stream — which included $4.3 million in donations and $2.9 million in interest paid on $28 million in cash investments — the local branch of the controversial religion is losing money across its Australian operations.

Losses at the church grew from $136,375 in 2011 to $169,156 by December 2012. But the accounts contain a number of discrepancies with the 2011 accounts stating the church made a $91,000 profit.

The 2012 accounts — filed in June last year and covering both years — do not provide an explanation for the change.

http://www.heraldsun.com.au/news/vi...-riches-revealed/story-fni0fit3-1227234668874
 

Free to shine

Shiny & Free
Australian scientology financial details, income 30 million revealed for ASIC!

This is one interesting report! Talk about creative accounting.

The church’s figures show a large flood of income into the organisation in 2011 and 2012, including $4.3 million in donations and $2.9 million in interest collected from $28 million in investments, News Corp reports.

There are some reported discrepancies in the church's books which showed losses in 2011 and 2012 of $136,375 and $169,156 respectively.

But the joint accounting papers for both years that were filed last year showed church made a $91,000 profit.

Read more at http://www.9news.com.au/national/20...-large-revenue-and-losses#AIPM1meqbjqJETWO.99

Accounting books showed the church took in $10.5 million from "spiritual counselling and religious training" in 2011 and a further $8.7 million in 2012.

It also took in another $3.4 million from the sale of books written by the Church of Scientology's creator, the late science-fiction author L Ron Hubbard.

Its major expenses included $2 million on church services, $1.4 million on legal fees, $1.4 million on missionary activity and $761,000 in licensing fees and gave $1.1 million to "affiliated organisations".

The church also paid $8.2 million on "volunteer welfare expenses" and "volunteer allowances" at a cost of more than $11,200 per day, but records do not provide specific details on what individual members were paid.

Read more at http://www.9news.com.au/national/20...-large-revenue-and-losses#AIPM1meqbjqJETWO.99
 

Free to shine

Shiny & Free
Re: Australian scientology financial details, income 30 million revealed for ASIC!

The church also paid $8.2 million on "volunteer welfare expenses" and "volunteer allowances" at a cost of more than $11,200 per day, but records do not provide specific details on what individual members were paid.

Is this supposed to be staff pay? 8.2 MILLION? In yer dreams.
 

Outethicsofficer

Silver Meritorious Patron
Re: Australian scientology financial details, income 30 million revealed for ASIC!

Is this supposed to be staff pay? 8.2 MILLION? In yer dreams.

I doubt it would all be staff pay Sue! Some would go to that, other amounts to their lodgings, food, uniforms and other things that could be associated with 'Volunteer support'.

$33,000,000 a year in income whilst not small is, I think, quite down on figures of many years ago...considering their 'unprecedented rate of expansion' :biggrin: in recent years.

In the late 80s the AO alone had GI of anywhere between a few thousand and $250,000 in a week, a good week. I don't exactly recall the total for a year but it may have been near $5,000,000. And then donations for buildings were unheard of. In my opinion, the current scene is one of contraction in terms of income generated by means of services and delivery.
 

Anonycat

Crusader
Re: Australian scientology financial details, income 30 million revealed for ASIC!

I doubt it would all be staff pay Sue! Some would go to that, other amounts to their lodgings, food, uniforms and other things that could be associated with 'Volunteer support'.

$33,000,000 a year in income whilst not small is, I think, quite down on figures of many years ago...considering their 'unprecedented rate of expansion' :biggrin: in recent years.

In the late 80s the AO alone had GI of anywhere between a few thousand and $250,000 in a week, a good week. I don't exactly recall the total for a year but it may have been near $5,000,000. And then donations for buildings were unheard of. In my opinion, the current scene is one of contraction in terms of income generated by means of services and delivery.

Good to see you around, mate! :hattip:
 

tetloj

Silver Meritorious Patron
Tony O has the source reports (by way of Bryan Seymour) and has said to expect an article on this in the morning. :happydance:
 

tetloj

Silver Meritorious Patron
From Sydney Morning Herald article

The church’s long-standing treasurer was removed as a listed director in April, two months before the latest accounts­ were lodged.

Ms Stewart said the church’s treasurer of twelve years had left to carry out missionary work.

Code for the RPF? The Hole? Or simply, "out of the prying reach of you DBs"?
 

imSPecial

Patron with Honors
From Sydney Morning Herald article





Code for the RPF? The Hole? Or simply, "out of the prying reach of you DBs"?


my first thought went to the corporate reorg also mentioned. with restructuring comes money movement. i bet its got as much to do with keeping the poor person out of the media's reach as keeping the poor person from knowing anything about the new structure.
 

Free to shine

Shiny & Free
Here's the Bunker must read article, including links to the full financial reports:
http://tonyortega.org/2015/02/23/sc...k-bryan-seymour-and-nick-xenophon/#more-20560

Scientology Australia spills its guts, and you can thank Bryan Seymour and Nick Xenophon
Scientology’s annual financial reports for 2011 and 2012 were submitted to ASIC, and those were made public yesterday by the Australian press. We have both reports for you.

We asked Seymour why he thought Scientology had changed its corporate structure, forcing it to divulge its financial health.

“If the charities commission had not been set up, Scientology would not have re-incorporated and handed over their accounts,” Seymour says. “I’ve asked the charities commission to review the article published today and if they will launch an investigation into the unexplained losses and where Scientology’s money is going. Either way — Scientology will, for the first time in Australia, be scrutinised for what it really is: A business, operated as a cult, masquerading as a religion.”




:clap::clap::clap::clap::clap:
 

Free to shine

Shiny & Free
Re: Australian scientology financial details, income 30 million revealed for ASIC!

I doubt it would all be staff pay! Some would go to that, other amounts to their lodgings, food, uniforms and other things that could be associated with 'Volunteer support'.

$33,000,000 a year in income whilst not small is, I think, quite down on figures of many years ago...considering their 'unprecedented rate of expansion' :biggrin: in recent years.

In the late 80s the AO alone had GI of anywhere between a few thousand and $250,000 in a week, a good week. I don't exactly recall the total for a year but it may have been near $5,000,000. And then donations for buildings were unheard of. In my opinion, the current scene is one of contraction in terms of income generated by means of services and delivery.

Here's an answer from the Bunker article above:

“The total volunteer allowances and volunteer welfare expenses for 2011 and 2012 for what Bryan says are ‘500 volunteers’ are $4,354,198 for 2011 and $3,827,144 for 2012,” Rinder points out. “Presumably this means there were fewer volunteers in 2012 than in 2011. But just calculating a ballpark figure, this means that the pay for all staff and living expenses for all Sea Org workers comes to $73,000 per week. If this is for 500 people, that’s $147 per person per week for pay, food, living, healthcare, uniforms etc. And some of those are not Sea Org, so the outlay is not covering their living expenses. So, at best, if there are no Sea Org, the average wage of all staff in Australia is $147/week. And if they are all Sea Org then they are spending $147/week for full time, 7 day a week labor that are obviously not receiving medical care and are living in squalor and eating rice and beans. The truth lies somewhere between the two.”
 

Free to shine

Shiny & Free
A looong comment. I hope this leads to a great discussion, this is juicy!

John P. • 4 minutes ago

A couple of thoughts from we in Global Capitalism HQ, who scrutinize things like this all day long. These are from the 2011 financials only; I haven't had time to scrutinize the 2012 accounts. I'll post a reply to this post with the 2012 numbers if I get a chance on what looks like a fairly busy Monday to look at them.

By far, the most amazing number in the 2011 financial statement is the balance sheet entry showing a liability $29.2 million in deposits for undelivered services. Given that they delivered $10.5 million in "counseling & religious training," per Note 2 on Page 12, that means they have three years' revenue worth of deposits. That would be a catastrophic liability in any organization, and if those who have blown want their money back, the cult would instantly be bankrupt. They claim to have $26.7 million in cash on the balance sheet and a "net equity" (i.e., book value) of $25.4 million, both less than the liability to customers for deposits.

If I had to guess where there's something fishy going on, it's that they have a strong cash balance of $27 million while being essentially break-even or a little less, with small operating losses in both 2011 and 2012. Allowing local organizations to retain cash seems antithetical to all we've heard from ex-members, including some who were Flag Banking Officers. If I were Senator Xenophon, I'd instruct those in the government auditing the financial statements to test whether the bank accounts carrying the cash were truly under control of the local organization. I would be willing to bet that this is how Miscavige covers looting the local org, by pretending that the Australians still have control over their cash balances. It would be difficult to catch such a setup but it could be done if the auditor knew what they were looking for.

Note 3 of the financials says they have $19.7 million of their $26.7 million cash balance in "interest bearing deposits." I bet that's the scam: they have "loaned" money to Miscavige and he's paying them "interest" to the tune of $556,000 per year (per Note 2 of the financials). They're claiming to get over 2% on their cash hoard. There aren't a lot of corporate treasurers in the US who are getting 2% on treasury operations these days and I refuse to believe the cult's treasury management is that good at generate interest. I suspect they're far better at keeping cash out of the reach of seizure, which typically results in very low interest. I certainly don't think they can get 2% on cash via straight bank interest.

I don't see anything in the financial statements about money being sent "uplines" to Miscavige. The only thing that could explicitly cover this is "ecclesiastical services" of $1.03 million in the 2011 financials or "Licensing Fees & Memberships". There are probably ways that some other money sent "uplines" is hidden in other line items like "religious training," which is probably people being sent to Flag for Golden Age of Dreck II training, etc. That money ends up in Miscavige's pocket, of course.

Another number worth considering is the "net realizable value" of inventories on hand. They're saying that they have $7.35 million in inventory (mostly books but perhaps e-meters as well). They say in Note 5 of the financials that "current replacement cost" (what they would have to pay to get more copies of "Science of Survival" from California (translated into Ocker or Strine by the translations unit of Bridge Publications, of course) would be $7.4 million, but the "net realizable value" (what customers would actually be willing to pay for them) is only $140,000. In other words, they've been burdened with unsaleable crap from HQ. So that's one facet of where the money has gone in the past. I bet it means that they have $6 million in copes of The Basics where that scam was pushed heavily a few years back. The fact that book sales in 2011 were roughly at breakeven, where costs were somewhat near revenue, suggests that the book scam as a source of real revenue, is basically done.

The "Film Lease" payments of $121,000 in 2011 also seems suspiciously low given what we've heard in the past about that being a source of income for Cult Central in California.

Purchases of books and "artefacts" from HQ of $1.68 million out of total revenue of $17.3 million sounds pretty reasonable. It's only when you note on page 12 that book sales were $1.5 million, so they were getting fleeced on the books, so all of that is money going "uplines" for inflated books and e-meters wholesale prices.

On the revenue breakdown in Note 2, it would be interesting to see what "contributions from affiliated organizations" of $948,000 represented. Is it stuff from CCHR, Narconon and other front groups?

Gotta run and get to the Global Capitalism HQ daily routine of overseeing and tending the world's economy, so I can't spend more time on this now, but I hope this is an informative start. Other financially minded folks, especially those familiar with accounting rules in Oz, should dig in and share their knowledge.
 

Outethicsofficer

Silver Meritorious Patron
From Sydney Morning Herald article





Code for the RPF? The Hole? Or simply, "out of the prying reach of you DBs"?


The longstanding Treasurer was Liz Kleitch, she's been out of the Sea Org about 2 years or so, routed out! That line by Virginia Stewart is BS!

What Liz would know about the internals of the C of S as it relates to financials would fill a book.
 

imSPecial

Patron with Honors
i wonder if the affiliated organizations stuff he talks about are from things like someone being regged in another geographical zone, like south africa, to go do services in anzo, etc.
 

Lohan2008

Gold Meritorious Patron
Scientology Australia spills its guts

For several years, one of Australia’s crusading senators, covered closely by one of the country’s most dogged television reporters, put pressure on the Church of Scientology to face more regulation with the creation of a national charities commission.

That effort paid off yesterday in a big way when Scientology’s internal financial reports were revealed for the first time by the Australian press, providing a rare look at how the organization is faring in that country.

We have those reports for you to go through, as well as some help understanding them from former Scientology spokesman (and native Australian) Mike Rinder.

But first, we want to remind people how we got here, and why Australia, at least, is regulating Scientology in a way that certainly isn’t happening in the United States.

Over a period from 2007 that lasted more than four years, television journalist Bryan Seymour pounded Scientology with investigative coverage which showed how lax Australian tax regulations were being used by the church to get around stricter regulations in places like the UK and elsewhere.

A conversation with independent Senator Nick Xenophon led to the Adelaide lawmaker going public with his concerns about Scientology, and his support for a charities commission that would regulate non-profits like Scientology to make sure that they were providing some kind of public benefit.

Less than two weeks later, on May 23, 2011, Scientology in Australia reorganized itself. It became a non-profit type known as a “company limited by guarantee.” By law, that meant that Scientology would have to open up its books, but to the Australian Securities and Investments Commission (ASIC), and not to the newly formed charities commission.

Scientology’s annual financial reports for 2011 and 2012 were submitted to ASIC, and those were made public yesterday by the Australian press. We have both reports for you.

We asked Seymour why he thought Scientology had changed its corporate structure, forcing it to divulge its financial health.

“If the charities commission had not been set up, Scientology would not have re-incorporated and handed over their accounts,” Seymour says. “I’ve asked the charities commission to review the article published today and if they will launch an investigation into the unexplained losses and where Scientology’s money is going. Either way — Scientology will, for the first time in Australia, be scrutinised for what it really is: A business, operated as a cult, masquerading as a religion.”

The Herald Sun and 9News.com each reported that despite only 2,163 Scientologists in the country according to the most recent census, the organization took in $33.1 million in revenue over the two years, 2011 and 2012, but still managed to lose money each year — $136,375 in 2011, and $169,156 in 2012.

Some of that revenue over two years was in the form of interest on Scientology’s investments, but $4.3 million was in donations, and $3.4 million in book sales. (Scientologists are under intense pressure to spend freely on both books and other materials, and to make large donations.)

The Herald Sun points out that the opening of a new “Ideal Org” in Melbourne in 2011 appears to have resulted in a significant increase in “minor” course completions that year, but the next year that subsided. Mike Rinder noticed other interesting trends in the detailed reports. But he was also concerned by what he didn’t find in them.

“This is really hard to sort out because they spun off Melbourne, according to their 2012 report, as of 1 October 2012,” Rinder explained to us in an email. “So, do these two years compare? I have no idea.”

He was also concerned that some detailed breakdowns of revenue present in the 2011 report were missing in 2012.

“The 2012 report doesn’t include the most interesting figures in the 2011 report, which are on page 12 — The total receipts for auditing and training, for book sales and straight donations. The total contributions from parishioners went down from $16.2 million in 2011 to $13.1 million in 2012 even though the fundraising for the ‘Sydney Ideal Org’ (which opened in 2014) was going ‘full blast,’ and the Melbourne Ideal Org was supposedly expanding out the roof,” he says.

“But it is definitely true that these figures are for all churches in Australia, including the Advanced Org and the CLO. The other figures of interest are on page two of the 2012 report. Despite the new Ideal Org in Melbourne ‘parishioners completing major courses’ declined by 9 percent. After that drop, they only increased 5 percent in 2012 — in other words, they did not even recover to the level of 2010,” he adds.

Seymour pointed out that Scientology did make an annual information report to the charities commission, and in it the organization claims that it has zero employees, but 500 volunteers.

Scientology, in other words, is calling “volunteers” its org staff members, as well as its incredibly dedicated “Sea Org” workers, who sign billion-year contracts, work around the clock for pennies an hour, and may be separated from family for years at a time without a single day off a year.

“The total volunteer allowances and volunteer welfare expenses for 2011 and 2012 for what Bryan says are ‘500 volunteers’ are $4,354,198 for 2011 and $3,827,144 for 2012,” Rinder points out. “Presumably this means there were fewer volunteers in 2012 than in 2011. But just calculating a ballpark figure, this means that the pay for all staff and living expenses for all Sea Org workers comes to $73,000 per week. If this is for 500 people, that’s $147 per person per week for pay, food, living, healthcare, uniforms etc. And some of those are not Sea Org, so the outlay is not covering their living expenses. So, at best, if there are no Sea Org, the average wage of all staff in Australia is $147/week. And if they are all Sea Org then they are spending $147/week for full time, 7 day a week labor that are obviously not receiving medical care and are living in squalor and eating rice and beans. The truth lies somewhere between the two.”

The Herald Sun reported that Scientology Australia’s spokeswoman, Virginia Stewart, tried to make the stagnated numbers look like the result of massive expansion: “Operating losses can happen, especially during periods when the church is expanding its outreach activities, increasing its service facilities and community programs,” she said. “We have planning in progress for other locations of our churches in Australia and Asia.”

If you haven’t read our story about Virginia Stewart and disconnection, please do.

Our commenting community includes some top-notch experts on Scientology’s finances, including former financial executives who worked in the Sea Org, and we look forward to what you can glean from these reports

http://tonyortega.org/2015/02/23/sc...ou-can-thank-bryan-seymour-and-nick-xenophon/

http://www.scribd.com/doc/256613176/Scientology-Australia-Financial-Report-2011

http://www.scribd.com/doc/256613358/Scientology-Australia-Financial-Report-2012
 

Lohan2008

Gold Meritorious Patron
Re: Scientology Australia spills its guts

Can someone make sure that the financial reports are 'mirrored' so cult can't destroy the facts.
 

Free to shine

Shiny & Free
Some more fascinating comments:

chuckbeattyexseaorg75to03 • 2 hours ago

John P notes even more accurately, the movement of the weekly income and donations, that is done.

FBO hierarchy policies and weekly actions of the FBO require them to MOVE that money into and through their FBO Accounts into the bank accounts also accessible by the Continental Finance Office person, who in turns transfers that money into accounts then accessible by the Int Finance and Sea Org Reserves person at Int, and the exact setup is all Hubbard orders and policy.

They have a way of transferring money into accounts that are then in their next higher echelon's control, and putting the Australian money made OUT of the control of the Australians! The Hubbard policy makes rules to never give that money BACK to the control of the lower echelons.

How they get their FBO.Finance network personnel who control the banking and transferring of the money, WEEKLY, to keep it OUT of the hands of the local churches who made that money/donations, is groomed into their heads.

They could embezzle, all along the way, of course, the bank account signatories are the FBOs, Cont FBO/Cont Finance persons, then Int Finance person(s), then Sea Org Reserves/WDC Reserves/Int Finance Director person whichever one is currently doing it, and then between Mark Ingber and Miscavige, or whoever else at that level, it's finally made only accessible by those TOP signatories of whichever account the money has been finally transferred into, in such a way that the LOWER signatories don't have that money any longer.

YES, as Tony says, the ex member FBO and ex Finance Office staff, and ex people like Amy Scobee who as WDC CC and being in that arena of the top money signatory control funneling, this CAN be broken into the details so Australian officials looking into all this CAN get their heads on this weak link point that John P I think nails right on the money:

John P said above:

"If I had to guess where there’s something fishy going on, it’s that they have a strong cash balance of $27 million while being essentially break-even or a little less, with small operating losses in both 2011 and 2012. Allowing local organizations to retain cash seems antithetical to all we’ve heard from ex-members, including some who were Flag Banking Officers. If I were Senator Xenophon, I’d instruct those in the government auditing the financial statements to test whether the bank accounts carrying the cash were truly under control of the local organization. I would be willing to bet that this is how Miscavige covers looting the local org, by pretending that the Australians still have control over their cash balances. It would be difficult to catch such a setup but it could be done if the auditor knew what they were looking for."
http://tonyortega.org/2015/02/23/sc...seymour-and-nick-xenophon/#comment-1871425036

John P. Mat Pesch • 8 hours ago

Mat, thanks for the perspective. It's especially valuable coming from someone who actually did the job in finance.

Your memory of what happened on the ground gives some corroboration to my hunch that the financials of the Australian entity shouldn't be in the reasonably benign condition they appear to be in. They are "mocking up" a set of bogus financials that wouldn't pass muster if audited, because even if they can produce bank statements with assets in the amounts claimed, the assets would be lower because the cash balances are not in fact under control of the entity that claims to own them. A forensic accountant would be able to determine from the pattern of withdrawals and who authorized those withdrawals whether Sydney controlled them or whether Cult Central controlled them.

The cult's fraud and financial statement manipulation techniques are stuck in the 1980s, and I would bet they haven't evolved much since Hubbard's day. If you underestimate the ability of governments to track movement of money since 9/11 and the PATRIOT Act, you are sadly naive. It will be fun to see what happens if a government auditor finds a reason to do a deep dive into this set of books looking for evidence of criminal conduct.
http://tonyortega.org/2015/02/23/sc...seymour-and-nick-xenophon/#comment-1870756793

TheHoleDoesNotExist • 10 hours ago

Haven't dove into financials yet, but a few points to look for:
1) Staff expenses - in the S.O. they included room and board - I remember the one time I saw figures it was a shock - the amount scientology was claiming was ridiculously overstated. These expenses also included an Estates payment - for building maintenance (which was often done by RPF'rs), serving food (slop), and incidentals like toilet paper, and you know how miserly they were even down to TP. Expenses also included training, which often was another padded stat. Sometimes training for your post (job) was - figure it out and make it go right or maybe 4 handwritten sheets from the poor slob before you who couldn't figure it out either. Training and auditing staff expenses are a huge padded stat. They include trips to your ethics officer, confessionals, etc.

2) Books and materials - Management's markup on costs are astronomical and the orgs must pay up front whatever they get sent, so that's another way money goes up lines. I think when DM needs another pair of Lobbs, he discovers a missing semicolon. This scam seems to have been a true up straight and vertical expansion in the last 5 years - that's internationally.

3) Another common way to hide money going up lines is charges for "consultation, or consulting fees", or it may show up as management fees. This is usually disproportionate by a mile and a visible red flag to any financial auditor. There's a long list of upper management that gets a cut of any cash coming in. FBO account, and SO Reserves, used to be GO and now OSA - however they're hiding it, it will be for legal fees, also disproportionate. There's Landlord Office. Not sure how all this fundraising cash for real estate is coming in - but this will be another disproportionate amount unless is gets broken up into different streams. Today there is probably also a separate account for the IAS which has to get a cut.

4) Monies on account for services - this should get a magnifying glass for any forensic auditor. Whatever $$ figure is listed - let them prove it! All scientology money flows upward. The reason so many forms to sign, the reason Miscavige will fight any refunds of any size is that he doesn't want anyone - not just outside the bubble - but he doesn't want the staff and public, especially whales, to find out the money isn't there, like it Should be.

Opening and shining a light on scientology financials is like shining a light into a vampire's eyes. All the wasted resources and damaged lives over the decades, all the fair gaming, the spying, the harassment, the smear campaigns, the lawsuits, the "disappearing" of people, like this Treasurer - every bit of it was to keep those finances from ever seeing the light of day. No matter what reasons, what shore stories, what lies are told about why, the truth is:

Scientology can't exist in the light.
http://tonyortega.org/2015/02/23/sc...seymour-and-nick-xenophon/#comment-1870638685
 

AnonyMary

Formerly Fooled - Finally Free
Re: Scientology Australia spills its guts

The auditor of those reports is a scientologist and has been for some time.

Gaetano Cammarata Prudential Partners Pty. Ltd. Industry: Accounting and Bookkeeping Service Companies
http://listings.fta-companies-au.com/l/101647569/Prudential-Partners-Pty-Ltd-in-Sydney-NSW

Gaetano Cammarata
http://www.truthaboutscientology.com/stats/by-name/g/gaetano-a.-cammarata.html
http://www.truthaboutscientology.com/stats/by-name/g/gaetano-antonio-cammarata.html
easons for decision
www.vicbar.com.au/getfile.ashx?file=barassoctaxfiles/bamford.doc
At all material times, and during the 2000 tax year, the Church of Scientology was also ..... On 14 March 2008, I Gaetano Antonio Cammarata, known as Tony ...
http://www.vicbar.com.au/getfile.ashx?file=barassoctaxfiles/bamford.doc
 
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