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From <ent type='ORG'>TIME Magazine</ent>, May 6, 1991:

<ent type='ORG'>THE THRIVING CULT</ent> OF GREED AND POWER

Ruined lives. Lost fortunes. <ent type='ORG'>Federal crimes</ent>.
<ent type='ORG'>Scientology</ent> poses as a religion but is really a ruthless
global scam - and aiming for the mainstream.

By <ent type='PERSON'>Richard Behar</ent>

By all appearances, <ent type='PERSON'>Noah Lottick</ent> of <ent type='GPE'>Kingston</ent>, Pa. had been a
normal, happy 24-year-old who was looking for his place in the world.
On the day last June when his parents drove to <ent type='GPE'>New York</ent> to claim his
body, they were nearly catatonic with grief. The young
<ent type='NORP'>Russian</ent>-studies scholar had jumped from a 10th-floor window of the
Milford Plaza Hotel and bounced off the hood of a stretch limosine.
When the police arrived, his fingers were still clutching $171 in
cash, virtually the only money he hadn't yet turned over to <ent type='ORG'>the Church</ent>
of <ent type='ORG'>Scientology</ent>, the self-help "philosophy" group he had discovered
just seven months earlier.
His death inspired his father <ent type='PERSON'>Edward</ent>, a physician, to start his
own investigation of the church. "We thought <ent type='ORG'>Scientology</ent> was
something like <ent type='PERSON'>Dale Carnegie</ent>," Lottick says. "I now believe it's a
school for psychopaths. Their so-called therapies are manipulations.
They take the best and brightest people and destroy them." The
Lotticks want to sue the church for contributing to their son's death,
but the prospect has them frightened. For nearly 40 years, the big
business of <ent type='ORG'>Scientology</ent> has shielded itself exquisitely behind the
First Amendment as well as a battery of high-priced criminal lawyers
and shady private detectives.
<ent type='ORG'>The Church</ent> of <ent type='ORG'>Scientology</ent>, started by science-fiction writer L.
<ent type='PERSON'>Ron Hubbard</ent> to "clear" people of unhappiness, portrays itself as a
religion. In reality the church is a hugely profitable global racket
that survives by intimidating members and critics in a <ent type='ORG'>Mafia</ent>-like
manner. At times during the past decade, prosecutions against
<ent type='ORG'>Scientology</ent> seemed to be curbing its menace. Eleven top
<ent type='ORG'>Scientologists</ent>, including Hubbard's wife, were sent to prison in the
early 1980's for infiltrating, burglarizing, and wiretapping more than
100 private and government agencies in attempts to block their
investigations. In recent years hundreds of longtime <ent type='ORG'>Scientology</ent>
adherents - many charging that they were mentally or physically abused
- have quit the church and criticized it at their own risk. Some have
sued the church and won; others have settled for amounts in excess of
$500000. In various cases judges have labeled the church
"schizophrenic and paranoid" and "corrupt, sinister and dangerous."
Yet the outrage and litigation have failed to squelch
<ent type='ORG'>Scientology</ent>. The group, which boasts 700 centers in 65 countries,
threatens to become more insidious and persuasive than ever.
<ent type='ORG'>Scientology</ent> is trying to go mainstream, a strategy that has sparked a
renewed law-enforcement campaign against the church. Many of the
group's followers have been accused of committing financial scams,
while the church is busy attracting the unwary through a wide array of
front groups in such businesses as publishing, consulting, health care
and even remedial education.
In <ent type='GPE'>Hollywood</ent>, <ent type='ORG'>Scientology</ent> has assembled a star-studded roster of
followers by aggressively recruiting and regally pampering them at the
church's "Celebrity Centers," a chain of clubhouses that offers
expensive counseling and career guidance. Adherents include screen
idols <ent type='PERSON'>Tom Cruise</ent> and <ent type='PERSON'><ent type='PERSON'>John</ent> <ent type='PERSON'>Travolta</ent></ent>, actresses <ent type='PERSON'>Kirstie Alley</ent>, Mimi
Rogers and <ent type='PERSON'>Anne Archer</ent>, <ent type='GPE'>Palm Springs</ent> mayor and performer <ent type='PERSON'>Sonny Bono</ent>,
jazzman <ent type='PERSON'>Chick Corea</ent> and even <ent type='PERSON'>Nancy Cartwright</ent>, the voice of cartoon
star <ent type='PERSON'>Bart Simpson</ent>. Rank-and-file members, however, are dealt a less
glamorous <ent type='ORG'>Scientology</ent>.
According to <ent type='ORG'>the Cult Awareness Network</ent>, whose 23 chapters
monitor more than 200 "mind control" cults, no group prompts more
telephone please for help than does <ent type='ORG'>Scientology</ent>. Says <ent type='PERSON'>Cynthia Kisser</ent>,
.the network's <ent type='GPE'>Chicago</ent>-based executive director: "<ent type='ORG'>Scientology</ent> is quite
likely most ruthless, the most classically terroristic, the most
litigous and the most lucrative cult the country has ever seen. No
cult extracts more money from its members." <ent type='PERSON'>Agrees Vicki Aznaran</ent>, who
was one of Scientology's six key leaders until she bolted from the
church in 1987: "This is a criminal organization, day in and day out.
It makes <ent type='PERSON'>Jim</ent> and <ent type='PERSON'>Tammy</ent> [Bakker] look like kindergarten."
To explore Scientology's reach, <ent type='ORG'>TIME</ent> conducted more than 150
interviews and reviewed hundreds of court records and internal
<ent type='ORG'>Scientology</ent> documents. <ent type='ORG'>Church</ent> officials refused to be interviewed.
The investigation paints a picture of a depraved yet thriving
enterprise. Most cults fail to outlast their founder, but <ent type='ORG'>Scientology</ent>
has prospered since Hubbard's death in 1986. In a court filing, one
of the cult's many entities - <ent type='ORG'>the Church</ent> of Spiritual Technology -
listed $503 million in income just for 1987. High-level defectors say
the parent organization has squirreled away an estimated $400 million
in bank accounts in <ent type='GPE'>Leichtenstein</ent>, <ent type='GPE'>Switzerland</ent> and <ent type='GPE'>Cyprus</ent>.
<ent type='ORG'>Scientology</ent> probably has about 50000 members, far fewer than the 8
million the group claims. But in one sense, that inflated figure
rings true: Millions of people have been affected in one way or
another by Hubbard's bizarre creation.
<ent type='ORG'>Scientology</ent> is now run by <ent type='PERSON'>David Miscavige</ent>, 31, a high school
dropout and second-generation church member. Defectors describe him
as cunning, ruthless and so paranoid about perceived enemies that he
kept plastic wrap over his glass of water. His obsession is to attain
credibility for <ent type='ORG'>Scientology</ent> in the 1990s. Among other tactics, the
group:
* Retains public relations powerhouse <ent type='ORG'>Hill</ent> and <ent type='ORG'>Knowlton</ent> to help
shed the church's fringe-group image.
* Joined such household names as <ent type='ORG'>Sony</ent> and <ent type='ORG'>Pepsi</ent> as a main sponsor
of <ent type='PERSON'>Ted Turner</ent>'s <ent type='ORG'>Goodwill Games</ent>.
* Buys massive quantities of its own books from retail stores to
propel the titles onto best-seller lists.
* Runs full-page ads in such publications as <ent type='ORG'>NEWSWEEK</ent> and
<ent type='ORG'>BUSINESS WEEK</ent> that call <ent type='ORG'>Scientology</ent> a "philosophy," along with a
plethora a TV ads touting the group's books.
* Recruits wealthy and respectable professionals through a web of
consulting groups that typically hide their ties to <ent type='ORG'>Scientology</ent>.
The founder of this enterprise was part storyteller, part
flimflam man. Born in <ent type='GPE'>Nebraska</ent> in 1911, <ent type='PERSON'>Hubbard</ent> was a moderately
successful writer of pulp science fiction. Years later, church
brochures described him falsely as an "extensively decorated" World
War II hero who was crippled and blinded in action, twice pronounced
dead and miraculously cured through <ent type='ORG'>Scientology</ent>. Hubbard's
"doctorate" from "<ent type='ORG'>Sequoia University</ent>" was a fake mail-order degree.
In a 1984 case in which the church sued a <ent type='PERSON'>Hubbard</ent> biographical
researcher, a <ent type='GPE'>California</ent> judge concluded that its founder was a
"pathological liar."
<ent type='PERSON'>Hubbard</ent> wrote one of Scientology's sacred texts, "<ent type='ORG'>Dianetics</ent>: The
Modern Science of Mental Health," in 1950. In it he introduced a
crude psychotherapeutic technique he called "auditing." He also
created a simplified lie detector (called an "E-meter") that was
designed to measure electrical charges in the skin while subjects
discussed intimate details of their past. <ent type='PERSON'>Hubbard</ent> argued that
unhappiness sprang from mental aberrations (or "engrams") caused by
early traumas. Counseling sessions with the E-meter, he claimed,
could knock out the engrams, cure blindness and even improve a
person's intelligence and appearance.
<ent type='PERSON'>Hubbard</ent> kept adding steps, each more costly, for his followers to
climb. In the 1960s the guru decreed that humans are made of clusters
of spirits (or "thetans") who were banished to earth some 75 million
years ago by a cruel galactic ruler named <ent type='NORP'>Xenu</ent>. Naturally, those
thetans had to be audited.
An <ent type='ORG'>Internal Revenue Service</ent> ruling in 1967 stripped Scientology's
mother church of its tax-exempt status. A federal court ruled in 1971
that Hubbard's medical claims were bogus and that E-meter auditing
.could no longer be called a scientific treatment. <ent type='PERSON'>Hubbard</ent> responded
by going fully religious, seeking First Amendment protection for
Scientology's strange rites. His counselors started sporting clerical
collars. Chapels were built, franchises became "missions" fees became
"fixed donations," and Hubbard's comic-book cosmology became "sacred
scriptures."
During the early 1970's, the <ent type='ORG'>IRS</ent> conducted its own auditing
session and proved that <ent type='PERSON'>Hubbard</ent> was skimming millions of dollars from
the church, laundering the money through dummy corporations in <ent type='GPE'>Panama</ent>
and stashing it in <ent type='NORP'>Swiss</ent> bank accounts. Moreover, church members
stole <ent type='ORG'>IRS</ent> documents, filed false tax returns and harassed the agency's
employees. By late 1985, with high-level defectors accusing <ent type='PERSON'>Hubbard</ent>
of having stolen as much as $200 million from the church, the <ent type='ORG'>IRS</ent> was
seeking an indictment of <ent type='PERSON'>Hubbard</ent> for tax fraud. <ent type='ORG'>Scientology</ent> members
"worked day and night" shredding documents the <ent type='ORG'>IRS</ent> sought, according
to defector <ent type='NORP'>Aznaran</ent>, who took part in the scheme. <ent type='PERSON'>Hubbard</ent>, who had
been in hiding for five years, died before the criminal case could be
prosecuted.
Today the church invents costly new services with all the zeal of
its founder. <ent type='ORG'>Scientology</ent> doctrine warns that even adherents who are
"cleared" of engrams face grave spiritual dangers unless they are
pushed to higher and more expensive sessions that cost as much as
$1000 an hour, or $12500 for a 12 1/2-hour "intensive."
Psychiatrists say these sessions can produce a drugged-like,
mind-controlled euphoria that keeps customers coming back for more.
To pay their fees, newcomers can earn commissions by recruiting new
members, become auditors themselves (<ent type='PERSON'>Miscavige</ent> did so at age 12), or
join the church staff and receive free counseling in exchange for what
their written contracts describe as a "billion years" of labor. "Make
sure that lots of bodies move through the shop," implored <ent type='PERSON'>Hubbard</ent> in
one of his bulletins to officials. "Make money. Make more money.
Make others produce so as to make money...however you get them in or
why, just do it."
<ent type='PERSON'>Harriet Baker</ent> learned the hard way about Scientology's business
of selling religion. When <ent type='PERSON'>Baker</ent>, 73, lost her husband to cancer, a
Scientologist turned up at her <ent type='GPE'>Los Angeles</ent> home peddling a $1300
auditing package to cure her grief. Some $15000 later, the
<ent type='ORG'>Scientologists</ent> discovered that her home was debt free. They arranged
a $45000 mortgage, which they pressured her to tape for more auditing
until Baker's children helped their mother snap out of her daze. Last
June, <ent type='PERSON'>Baker</ent> demanded a $27000 refund for unused services, prompting
two cult members to show up at her door unannounced with an E-meter to
interrogate her. <ent type='PERSON'>Baker</ent> never got the money and, financially strapped,
was forced to sell her house in September.
Before <ent type='PERSON'>Noah Lattick</ent> killed himself, he had paid more than $5000
for church counseling. His behavior had also become strange. He once
remarked to his parents that his <ent type='ORG'>Scientology</ent> mentors could actually
read minds. When his father suffered a major heart attack, <ent type='PERSON'>Noah</ent>
insisted that it was purely psychosomatic. Five days before he
jumped, <ent type='PERSON'>Noah</ent> burst into his parents' home and demanded to know why
they were spreading "false rumors" about him - a delusion that finally
prompted his father to call a psychiatrist.
It was too late. "From Noah's friends at <ent type='ORG'>Dianetics</ent>" read the
card that accompanied a bouquet of flowers at Lottick's funeral. Yet
no <ent type='ORG'>Scientology</ent> staff member bothered to show up. A week earlier,
local church officials had given Lottick's parents a red-carpet tour
of their center. A cult leader told Noah's parents that their son had
been at the church just hours before he disappeared - but the church
denied this story as soon as the body was identified. True to form,
the cult even haggled with the Lotticks over $3000 their son had paid
for services he never used, insisting that <ent type='PERSON'>Noah</ent> had intended it as a
"donation."
The church has invented hundreds of goods and services for which
members are urged to give "donations." Are you having trouble "moving
swiftly up the Bridge" - that is advancing up the stepladder of
enlightenment? Then you can have your case reviewed for a mere $1250
."donation." Want to know "why a thetan hangs on to the physical
universe?" Try 52 of Hubbard's tape-recorded speeches from 1952,
titled "Ron's Philadelphia Doctorate Course Lectures," for $2525.
Next: Nine other series of the same sort. For the collector,
gold-and-leather-bound editions of 22 of Hubbard's books (and
bookends) on subjects ranging from <ent type='ORG'>Scientology</ent> ethics to radiation can
be had for just $1900.
To gain influence and lure richer, more sophisticated followers,
<ent type='ORG'>Scientology</ent> has lately resorted to a wide array of front groups and
financial scams. Among them:

CONSULTING. <ent type='ORG'>Sterling Management Systems</ent>, formed in 1983, has been
ranked in recent years by INC. magazine as one of America's
fastest-growing private companies (estimated 1988 revenues: $20
million). <ent type='ORG'>Sterling</ent> regularly mails a free newsletter to more than
300000 health-care professionals, mostly dentists, promising to
increase their incomes dramatically. The firm offers seminars and
courses that typically cost $10000. But Sterling's true aim is to
hook customers for <ent type='ORG'>Scientology</ent>. "The church has a rotten product, so
they package it as something else," says <ent type='PERSON'>Peter Georgiades</ent>, a
<ent type='GPE'>Pittsburgh</ent> attorney who represents <ent type='ORG'>Sterling</ent> victims. "It's a kind of
bait and switch." Sterling's founder, dentist <ent type='PERSON'>Gregory Hughes</ent>, is now
under investigation by California's Board of Dental Examiners for
incompetence. Nine lawsuits are pending against him for malpractice
(seven others have been settled), mostly for orthodontic work on
children.
Many dentists who have unwittingly been drawn into the cult are
filing or threatening lawsuits as well. Dentist <ent type='PERSON'>Robert Geary</ent> of
Medina, <ent type='GPE'>Ohio</ent>, who entered a <ent type='ORG'>Sterling</ent> seminar in 1988, endured "the
most extreme high-pressure sales tactics I have ever faced." <ent type='ORG'>Sterling</ent>
officials told <ent type='PERSON'>Geary</ent>, 45, that their firm was not linked to
<ent type='ORG'>Scientology</ent>, he says. But <ent type='PERSON'>Geary</ent> claims they eventually convinced him
that he and his wife had personal problems that required auditing.
Over five months, the <ent type='PERSON'>Geary</ent>s say, they spent $130000 for services,
plus $50000 for "gold-embossed, investment-grade" books signed by
<ent type='PERSON'>Hubbard</ent>. <ent type='PERSON'>Geary</ent> contends that <ent type='ORG'>Scientologists</ent> not only called his bank
to increase his credit-card limit but also forged his signature on a
$20000 loan application. "It was insane," he recalls. "I couldn't
even get an accounting from them of what I was paying for." At one
point, the <ent type='PERSON'>Geary</ent>s claim, <ent type='ORG'>Scientologists</ent> held <ent type='PERSON'>Dorothy</ent> hostage for two
weeks in a mountain cabin, after which she was hospitalized for a
nervous breakdown.
Last October, <ent type='ORG'>Sterling</ent> broke some bad news to another dentist,
<ent type='PERSON'>Glover Rowe</ent> of <ent type='GPE'>Gadsden</ent>, Ala., and his wife <ent type='PERSON'>Dee</ent>. Tests showed that
unless they signed up for auditing, Glover's practice would fail, and
<ent type='PERSON'>Dee</ent> would someday abuse their child. The next month the <ent type='PERSON'>Rowes</ent> flew to
<ent type='GPE'>Glendale</ent>, <ent type='GPE'>Calif</ent>., where they shuttled daily from a local hotel to a
<ent type='ORG'>Dianetics</ent> center. "We thought they were brilliant people because they
seemed to know so much about us," recalls <ent type='PERSON'>Dee</ent>. "Then we realize our
hotel room must have been bugged." After bolting from the center,
$23000 poorer, the <ent type='PERSON'>Rowes</ent> say, they were chased repeatedly by
<ent type='ORG'>Scientologists</ent> on foot and in cars. Dentists aren't the only ones at
risk. <ent type='ORG'>Scientology</ent> also makes pitches to chiropractors, podiatrists
and veterinarians.

PUBLIC INFLUENCE. One front, <ent type='ORG'>the Way</ent> to Happiness Foundation, has
distributed to children in thousands of the nation's public schools
more than 3.5 million copies of a booklet <ent type='PERSON'>Hubbard</ent> wrote on morality.
The church calls the scheme "the largest dissemination project in
<ent type='ORG'>Scientology</ent> history." <ent type='ORG'>Applied Scholastics</ent> is the name of still
another front, which is attempting to install a <ent type='PERSON'>Hubbard</ent> tutorial
program in public schools, primarily those populated by minorities.
The group also plans a 1000-acre campus, where it will train
educators to teach various <ent type='PERSON'>Hubbard</ent> methods. The disingenuously named
<ent type='ORG'>Citizens Commission</ent> on Human Rights is a <ent type='ORG'>Scientology</ent> group at war with
psychiatry, its primary competitor. The commission typically issues
.reports aimed at discrediting particular psychiatrics and the field in
general. The <ent type='ORG'>CCHR</ent> is also behind an all-out war against <ent type='ORG'>Eli Lilly</ent>,
the maker of Prozac, the nation's top-selling antidepression drug.
Despite scant evidence, the group's members - who are calling
themselves "psychbusters" - claim that Prozac drives people to murder
or suicide. Through mass mailings, appearances on talk shows and
heavy lobbying, <ent type='ORG'>CCHR</ent> has hurt drug sales and helped spark dozens of
lawsuits against <ent type='ORG'>Lilly</ent>.
Another <ent type='ORG'>Scientology</ent>-linked group, <ent type='ORG'>the Concerned Businessmen</ent>'s
Association of <ent type='GPE'>America</ent>, holds antidrug contests and awards $5000
grants to schools as a way to recruit students and curry favor with
education officials. <ent type='GPE'>West Virginia</ent> Senator <ent type='PERSON'>John</ent> D. <ent type='PERSON'>Rockefeller</ent> IV
unwittingly commended the <ent type='ORG'>CBAA</ent> in 1987 on the Senate floor. Last
August author <ent type='PERSON'>Alex Haley</ent> was the keynote speaker at its annual awards
banquet in <ent type='GPE'>Los Angeles</ent>. Says <ent type='PERSON'>Haley</ent>: "I didn't know much about that
group going in. I'm a Methodist." Ignorance about <ent type='ORG'>Scientology</ent> can be
embarassing: two months ago, <ent type='GPE'>Illinois</ent> Governor <ent type='PERSON'>Jim</ent> Edgar, noting that
Scientology's founder "has solved the aberrations of the human mind,"
proclaimed March 13 "L. <ent type='PERSON'>Ron Hubbard</ent> Day." He rescinded the
proclamation in late March, once he learned who <ent type='PERSON'>Hubbard</ent> really was.

HEALTH CARE. HealthMed, a chain of clinics run by <ent type='ORG'>Scientologists</ent>,
promotes a grueling and excessive system of saunas, exercise and
vitamins designed by <ent type='PERSON'>Hubbard</ent> to purify the body. Experts denounce the
regime as quackery and potentially harmful, yet HealthMed solicits
unions and public agencies for contracts. The chain is plugged
heavily in a new book, "<ent type='ORG'>Diet</ent> for a Poisoned Planet," by journalist
<ent type='PERSON'>David Steinman</ent>, who concludes that scores of common foods (among them:
peanuts, bluefish, peaches and cottage cheese) are dangerous.
Former Surgeon general C. <ent type='PERSON'>Everett Koop</ent> labeled the book "Trash,"
and <ent type='ORG'>the Food and</ent> Drug Administration issued a paper in October that
claims <ent type='PERSON'>Steinman</ent> distorts his facts. "HealthMed is a gateway to
<ent type='ORG'>Scientology</ent>, and Steinman's book i a sorting mechanism," says
physician <ent type='PERSON'>William Jarvis</ent>, who is head of <ent type='ORG'>the National Council</ent> Against
Health Fraud. <ent type='PERSON'>Steinman</ent>, who describes <ent type='PERSON'>Hubbard</ent> favorably as a
"researcher," denies any ties to the church and contends, "HealthMed
has no affiliation that I know of with <ent type='ORG'>Scientology</ent>."

DRUG TREATMENT. Hubbard's purification treatments are the mainstay of
<ent type='ORG'>Narconon</ent>, a <ent type='ORG'>Scientology</ent>-run chain of 33 alcohol and drug
rehabilitation centers - some in prisons under the name "Criminon" -
in 12 countries. <ent type='ORG'>Narconon</ent>, a classic vehicle for drawing addicts into
the cult, now plans to open what it calls the world's largest
treatment center, a 1400-bed facility on an <ent type='NORP'>Indian</ent> reservation near
<ent type='GPE'>Newkirk</ent>, <ent type='GPE'>Okla</ent>. (Pop. 2400). At a 1989 ceremony in <ent type='GPE'>Newkirk</ent>, the
Association for Better Living and Education presented <ent type='ORG'>Narconon</ent> with a
check for $200000 and a study praising its work. The association
turned out to be part of <ent type='ORG'>Scientology</ent> itself. Today the town is
battling to keep out the cult, which has fought back through such
tactics as sending private detectives to snoop on the mayor and the
local newspaper publisher.

<ent type='ORG'>FINANCIAL SCAMS</ent>. Three <ent type='GPE'>Florida</ent> <ent type='ORG'>Scientologists</ent>, including Robert
Bernstein, a big contributor to the church's international "war
chest," pleaded guilty in March to using their rare-coin dealership as
a money laundry. Other notorious activities by <ent type='ORG'>Scientologists</ent> include
making the shady <ent type='GPE'>Vancouver</ent> stock exchange even shadier (see
accompanying article) and plotting to plant operatives in the World
Bank, International Monetary Fund and Export-Import Bank of the U.S.
The alleged purpose of this scheme: to gain inside information on
which countries are going to be denied credit so that
<ent type='ORG'>Scientology</ent>-linked traders can make illicit profits by taking "short"
positions in those countries' currencies.
In the stock market the practice of "shorting" involved borrowing
shares of publicly traded companies in the hope that the price will go
down before the stocks must be brought on the market and returned to
.the lender. The <ent type='PERSON'>Feshbach</ent> brothers of <ent type='GPE'>Palo Alto</ent>, <ent type='GPE'>Calif</ent>. - Kurt, <ent type='PERSON'>Joseph</ent>
and <ent type='PERSON'>Matthew</ent> - have become the leading short sellers in the U.S., with
more than $500 million under management. The <ent type='PERSON'>Feshbach</ent>s command a
staff of about 60 employees and claim to have earned better returns
than the <ent type='ORG'>Dow Jones</ent> industrial average for most of the 1980's. And,
they say, they owe it all to the teachings of <ent type='ORG'>Scientology</ent>, whose "war
chest" has received more than $1 million from the family.
The <ent type='PERSON'>Feshbach</ent>s also embrace the church's tactics; the brothers are
the terrors of the stock exchanges. In congressional hearings in
1989, the heads of several companies claimed that <ent type='PERSON'>Feshbach</ent> operatives
have spread false information to to government agencies and posed in
various guises - such as a <ent type='ORG'>Securities and Exchange Commission</ent> official
- in an effort to discredit the companies and drive the stocks down.
<ent type='PERSON'>Michael Russell</ent>, who ran a chain of business journals, testified that
a <ent type='PERSON'>Feshbach</ent> employee called his bankers and interfered with his loans.
Sometimes the <ent type='PERSON'>Feshbach</ent>s send private detectives to dig up dirt on
firms, which is then shared with business reporters, brokers and fund
managers.
The <ent type='PERSON'>Feshbach</ent>s, who wear jackets bearing the slogan "stock
busters," insist they run a clean shop. but as part of a possible
probe into insider stock trading, federal officials are reportedly
investigating whether the <ent type='PERSON'>Feshbach</ent>s received confidential information
from <ent type='ORG'>FDA</ent> employees. The brothers seem aligned with Scientology's war
on psychiatry and medicine: many of their targets are health and
biotechnology firms. "Legitimate short selling performs a public
service by deflating hyped stocks," says <ent type='PERSON'>Robert Flaherty</ent>, the editor
of <ent type='ORG'>EQUITIES</ent> magazine and a harsh critic of the brothers. "But the
<ent type='PERSON'>Feshbach</ent>s have damaged scores of good start-ups."
Occasionally a Scientologist's business antics land him in jail.
Last August a former devotee named <ent type='PERSON'>Steven Fishman</ent> began serving a
five-year prison term in <ent type='GPE'>Florida</ent>. His crime: stealing blank
stock-confirmation slips from his employer, a major brokerage house,
to use as proof that he owned stock entitling him to join dozens of
successful class-action lawsuits. <ent type='PERSON'>Fishman</ent> made roughly $1 million
this way from 1983 to 1986 and spent as much as 30% of the loot on
<ent type='ORG'>Scientology</ent> books and tapes.
<ent type='ORG'>Scientology</ent> denies any tie to the <ent type='PERSON'>Fishman</ent> scam, a claim strongly
disputed by both <ent type='PERSON'>Fishman</ent> and his longtime psychiatrist, <ent type='PERSON'>Uwe Geertz</ent>, a
prominent <ent type='GPE'>Florida</ent> hypnotist. Both men claim that when arrested,
<ent type='PERSON'>Fishman</ent> was ordered by the church to kill <ent type='PERSON'>Geertz</ent> and then do an "<ent type='ORG'>EOC</ent>,"
or end of cycle, which is church jargon for suicide.

BOOK PUBLISHING. <ent type='ORG'>Scientology</ent> mischiefmaking has even moved to the
book industry. Since 1985 at least a dozen <ent type='PERSON'>Hubbard</ent> books, printed by
a church company, have made best-seller lists. They range from a
5000-page sci-fi decalogy ("<ent type='ORG'>Black Genesis</ent>," "The Enemy Within," "An
Alien Affair") to the 40-year-old "<ent type='ORG'>Dianetics</ent>." In 1988 the trade
publication PUBLISHERS WEEKLY awarded the dead author a plaque
commemorating the appearance of "<ent type='ORG'>Dianetics</ent>" on its best-seller list
for 100 consecutive weeks.
Critics pan most of Hubbard's books as unreadable, while
defectors claim that church insiders are sometimes the real authors.
Even so, <ent type='ORG'>Scientology</ent> has sent out armies of its followers to buy the
group's books at such major chains as B. Dalton's and <ent type='ORG'>Waldenbooks</ent> to
sustain the illusion of a best-selling author. A former Dalton's
manager says some books arrived in his store with the chain's price
stickers already on them, suggesting that copies are being recycled.
<ent type='ORG'>Scientology</ent> claims that sales of Hubbard's books now top 90 million
worldwide. The <ent type='GPE'>sceme</ent>, set up to gain converts and credibility, is
coupled with a radio and TV advertising campaign virtually
unparalleled in the book industry.
<ent type='ORG'>Scientology</ent> devotes vast resources to squelching its critics.
Since 1986 <ent type='PERSON'>Hubbard</ent> and his church have been the subject of four
unfriendly books, all published by small yet courageous publishers.
In each case, the writers have been badgered and heavily sued. One of
Hubbard's policies was that all perceived enemies are "fair game" and
.subject to being "tricked, lied to or destroyed." those who criticize
the church - journalists, doctors, lawyers and even judges - often
find themselves engulfed in litigation, stalked by private eyes,
framed for fictional crimes, beaten up or threatened with death.
Psychologist <ent type='PERSON'>Margaret Singer</ent>, 69, an outspoken <ent type='ORG'>Scientology</ent> critic and
professor at <ent type='ORG'>the University</ent> of <ent type='GPE'>California</ent>, <ent type='GPE'>Berkeley</ent>, now travels
regularly under an assumed name to avoid harassment.
After the <ent type='GPE'>Los Angeles</ent> <ent type='ORG'>TIME</ent>S published a negative series on the
church last summer, <ent type='ORG'>Scientologists</ent> spent an estimated $1 million to
plaster the reporters' names on hundreds of billboards and bus
placards across the city. Above their names were quotations taken out
of context to portray the church in a positive light.
The church's most fearsome advocates are its lawyers. <ent type='PERSON'>Hubbard</ent>
warned his followers in writing to "beware of attorneys tell you not
to sue...the purpose of the suit is to harass and discourage rather
than to win." Result: <ent type='ORG'>Scientology</ent> has brought hundreds of suits
against its perceived enemies and today pays an estimated $20 million
annually to more than 100 lawyers.
One legal goal of <ent type='ORG'>Scientology</ent> is to bankrupt the opposition or
bury it under paper. The church has 71 active lawsuits against the
<ent type='ORG'>IRS</ent> alone. One of them, "<ent type='PERSON'>Miscavige</ent> vs. <ent type='ORG'>IRS</ent>," has required the U.S. to
produce an index of 52000 pages of documents. <ent type='GPE'>Boston</ent> attorney
<ent type='PERSON'>Michael Flynn</ent>, who helped <ent type='ORG'>Scientology</ent> victims from 1979 to 1987,
p\personally endured 14 frivolous lawsuits, all of them dismissed.
Another laywer, <ent type='PERSON'>Joseph</ent> <ent type='PERSON'>Yanny</ent>, believes the church "has so subverted
justice and the judicial system that it should be barred from seeking
equity in any court." He should know: <ent type='PERSON'>Yanny</ent> represented the cult
until 1987, when, he says, he was asked to help church officials steal
medical records to blackmail an opposing attorney (who was allegedly
beaten up instead). Since <ent type='PERSON'>Yanny</ent> quit representing the church, he has
been the target of death threats, burglaries, lawsuits and other
harassment.

Scientology's critics contend that the U.S. needs to crack down
on the church in a major, organized way. "I want to know, Where is
our government?" demands <ent type='PERSON'>Toby Plevin</ent>, a <ent type='GPE'>Los Angeles</ent> attorney who
handles victims. "It shouldn't be left to private litigators, because
God knows most of us are afraid to get involved." But law-enforcement
agents are also wary. "Every investigator is very cautious, walking
on eggshells when it comes to the church," says a <ent type='GPE'>Florida</ent> police
detective who has tracked the cult since 1988. "It will take a
federal effort with lots of money and manpower."
So far the agency giving <ent type='ORG'>Scientology</ent> the most grief is the <ent type='ORG'>IRS</ent>,
whose officials have implied that Hubbard's successors may be looting
the church's coffers. Since 1988, when the U.S. Supreme Court upheld
the revocation of the cult's tax-exempt status, a massive <ent type='ORG'>IRS</ent> probe of
church centers across the country has been under way. An <ent type='ORG'>IRS</ent> agent,
Marcus <ent type='PERSON'>Owens</ent>, has estimated that thousands of <ent type='ORG'>IRS</ent> employees have been
involved. Another agent, in an internal memorandum, spoke hopefully
of the "ultimate disintegration" of the church. A small but helpful
beacon shone last June when a federal appeals court ruled that two
cassette tapes featuring conversations between church officials and
their lawyers are evidence of a plan to commit "future frauds" against
the <ent type='ORG'>IRS</ent>.
Foreign governments have been moving even more vigorously against
the organization. In <ent type='GPE'>Canada</ent> the church and nine of its members will
be tried in June on charges of stealing government documents (many of
them retrieved in an enormous police raid of the church's <ent type='GPE'>Toronto</ent>
headquarters). <ent type='ORG'>Scientology</ent> proposed to give $1 million to the needy
if the case was dropped, but <ent type='GPE'>Canada</ent> spurned the offer. Since 1986
authorities in <ent type='GPE'>France</ent>, <ent type='GPE'>Spain</ent> and <ent type='GPE'>Italy</ent> have raided more than 50
<ent type='ORG'>Scientology</ent> centers. Pending charges against more than 100 of its
overseas church members include fraud, extortion, capital flight,
coercion, illegally practicing medicine and taking advantage of
medically incapacitated people. In <ent type='GPE'>Germany</ent> last month, leading
politicians accused the cult of trying to infiltrate a major party as
.well as launching an immense recruitment drive in the east.
Sometimes even the church's biggest zealots can use a little
protection. <ent type='ORG'>Screen</ent> star <ent type='PERSON'>Travolta</ent>, 37, has long served as an
unofficial <ent type='ORG'>Scientology</ent> spokesman, even though he told a magazine in
1983 that he was opposed to the church's management. High-level
defectors claim that <ent type='PERSON'>Travolta</ent> has long feared that if he defected,
details of his sexual life would be made public. "He felt pretty
intimidated about this getting out and he told me so," recalls William
<ent type='PERSON'>Franks</ent>, the church's former chairman of the board. "There were no
outright threats made, but it was implicit. If you leave, they
immediately start digging up everything." <ent type='PERSON'>Franks</ent> was driven out in
1981 after attempting to reform the church.

The church's former head of security, Richard <ent type='NORP'>Aznaran</ent>, recalls
<ent type='ORG'>Scientology</ent> leader <ent type='PERSON'>Miscavige</ent> repeatedly joking to staffers about
Travolta's allegedly promiscuous homosexual behavior. At this point
any threat to expose <ent type='PERSON'>Travolta</ent> seems superfluous: last May a male porn
star collected $100000 from a tabloid for an account of his alleged
two-year liaison with the celebrity. <ent type='PERSON'>Travolta</ent> refuses to comment, and
in December his lawyer dismissed questions about the subject as
"bizarre." Two weeks later, <ent type='PERSON'>Travolta</ent> announced that he was getting
married to actress <ent type='PERSON'>Kelly Preston</ent>, a fellow Scientologist.
Shortly after Hubbard's death the church retained <ent type='PERSON'>Trout</ent> &amp; Reis, a
respected, Connecticut-based firm of marketing consultants, to help
boost its public image. "We were brutally honest," says <ent type='PERSON'>Jack Trout</ent>.
"We advised them to clean up their act, stop with the controversy and
even to stop being a church. They didn't want to hear that."
Instead, <ent type='ORG'>Scientology</ent> hired one of the country's largest p.r. outfits,
<ent type='ORG'>Hill</ent> and <ent type='ORG'>Knowlton</ent>, whose executives refuse to discuss the lucrative
relationship. "<ent type='ORG'>Hill</ent> and <ent type='ORG'>Knowlton</ent> must feel that these guys are not
totally off the wall," says <ent type='PERSON'>Trout</ent>. "Unless it's just for the money."
One of Scientology's main strategies it to keep advancing the
tired argument that the church is being "persecuted" by
anti-religionists. It is supported in that position by the <ent type='GPE'>America</ent>n
Civil Liberties Union and <ent type='ORG'>the National Council</ent> of <ent type='ORG'>Church</ent>es. But in
the end, money is what <ent type='ORG'>Scientology</ent> is all about. As long as the
organization's opponents and victims are successfully squelched,
Scientology's managers and lawyers will keep pocketing millions of
dollars by helping it achieve its ends.


MINING MONEY IN VANCOUVER

One source of funds for the <ent type='GPE'>Los Angeles</ent>-based church is the
notorious, self-regulated stock exchange in <ent type='GPE'>Vancouver</ent>, British
<ent type='GPE'>Columbia</ent>, often called the scam capital of the world. The exchange's
2300 penny-stock listings account for $4 billion in annual trading.
Local journalists and insiders claim the vast majority range from
total washouts to outright frauds.
Two <ent type='ORG'>Scientologists</ent> who operate there are <ent type='PERSON'>Kenneth Gerbino</ent> and
<ent type='PERSON'>Michael Baybak</ent>, 20-year church veterans from Beverly <ent type='ORG'>Hill</ent>s who are
major donators to the cult. <ent type='PERSON'>Gerbino</ent>, 45, is a money manager,
marketer, and publisher of a national financial newsletter. He has
boasted in <ent type='ORG'>Scientology</ent> journals that he owes all his stock-picking
success to L. <ent type='PERSON'>Ron Hubbard</ent>. That's not saying much: Gerbino's
newsletter picks since 1985 have cumulatively returned 24%, while the
<ent type='ORG'>Dow Jones</ent> industrial average has more than doubled. Nevertheless
Gerbino's short-term gains can be stupendous. A survey last October
found <ent type='PERSON'>Gerbino</ent> to be the only manager who made money in the third
quarter of 1990, thanks to gold and other resource stocks. For the
first quarter of 1991, <ent type='PERSON'>Gerbino</ent> was dead last. <ent type='PERSON'>Baybak</ent>, 49, who runs a
public relations company staffed with <ent type='ORG'>Scientologists</ent>, apparently has
no ethics problem with engineering a hostile takeover of a firm he is
hired to promote.
Neither man agreed to be interviewed for this story, yet both
threatened legal action through attorneys. "What these guys do is
.take over companies, hype the stock, sell their shares, and then
there's nothing left," says <ent type='PERSON'>John</ent> Campbell, a former securities lawyer
who was director of mining company <ent type='ORG'>Athena Gold</ent> until <ent type='PERSON'>Baybak</ent> and
<ent type='PERSON'>Gerbino</ent> took it over.
The pattern has become familiar. The pair promoted a mining
venture called <ent type='ORG'>Skylark Resources</ent>, whose stock traded at nearly $4 a
share in 1987. The outfit soon crashed, and the stock is around 2
cents. NETI Technologies, a software company, was trumpeted in the
press as "the next <ent type='ORG'>Xerox</ent>" and in 1984 rose to a market value of $120
million with Baybak's help. The company, which later collapsed, was
delisted two months ago by the <ent type='GPE'>Vancouver</ent> exchange.
<ent type='PERSON'>Baybak</ent> appeared in 1989 at the helm of <ent type='ORG'>Wall Street Ventures</ent>, a
start-up that announced it owned 35 tons of rare <ent type='NORP'>Middle Eastern</ent>
postage stamps - worth $100 million - and was buying the world's
largest collection of southern <ent type='NORP'>Arabian</ent> stamps (worth $350 million).
Steven C. <ent type='PERSON'>Rockefeller</ent> Jr. of the oil family and former hockey star
<ent type='PERSON'>Dennis Potvin</ent> joined the company in top posts, but both say they quit
when they realized the stamps were virtually worthless. "The stamps
were created by sand-dune nations to exploit collectors," says Michael
Laurence, editor of LINN'S STAMP NEWS, America's largest stamp
journal. After the stock topped $6, it began a steady descent, with
<ent type='PERSON'>Baybak</ent> unloading his shares along the way. Today it trades at 18
cents.
<ent type='ORG'>Athena Gold</ent>, the current object of <ent type='PERSON'>Baybak</ent> and Gerbino's
attentions, was founded by entrepreneur <ent type='PERSON'>William Jordan</ent>. He turned to
an established <ent type='GPE'>Vancouver</ent> broker in 1987 to help finance the company, a
4500-acre mining property near <ent type='GPE'>Reno</ent>. The broker promised to raise
more than $3 million and soon brought <ent type='PERSON'>Baybak</ent> and <ent type='PERSON'>Gerbino</ent> into the
deal. <ent type='GPE'>Jordan</ent> never got most of the money, but the cult members ended
up with a good deal of cheap stock and options. Next time they
elected directors who were friendly to them and set in motion a series
of complex maneuvers to block <ent type='GPE'>Jordan</ent> from voting stock he controlled
and to run him out of the company. "I've been an honest policeman all
my life and I've seen the worst kinds of crimes, and this ranks high,"
says former <ent type='ORG'>Athena</ent> shareholder <ent type='PERSON'>Thomas Clark</ent>, a 20-year veteran of
Reno's police force who has teamed up with <ent type='GPE'>Jordan</ent> to try to get the
gold mine back. "They stole this man's property."
With <ent type='PERSON'>Baybak</ent> as chairman, the two <ent type='ORG'>Scientologists</ent> and their staffs
are promoting <ent type='ORG'>Athena</ent>, not always accurately. A letter to shareholders
with the 1990 annual report claims Placer Dome, one of America's
largest gold-mining firms, has committed at least $25.5 million to
develop the mine. That's news to Placer Dome. "There is no
pre-commitment," says Placer executive Cole McFarland. "We're not
going to spend that money unless survey results justify the
expenditure."
Baybak's firm represented <ent type='ORG'>Western Resource Technologies</ent>, a
<ent type='GPE'>Houston</ent> oil-and-gas company, but got the boot in October. Laughs
Steven McGuire, president of <ent type='ORG'>Western Resource</ent>: "His is a p.r. firm in
need of a p.r. firm." But McGuire cannot laugh too freely. <ent type='PERSON'>Baybak</ent>
and other <ent type='ORG'>Scientologists</ent>, including the estate of L. <ent type='PERSON'>Ron Hubbard</ent>,
still control huge blocks of his company's stock.

THE <ent type='NORP'>SCIENTOLOGISTS</ent> AND ME

Strange things seem to happen to people who write about
<ent type='ORG'>Scientology</ent>, Journalist <ent type='PERSON'>Paulette Cooper</ent> wrote a critical book about
the cult in 1971. This led to a <ent type='ORG'>Scientology</ent> plot (called Operation
Freak-Out) whose goal, according to church documents, was "to get P.C.
incarcerated in a mental institution or jail." It almost worked: By
impersonating <ent type='PERSON'>Cooper</ent>, <ent type='ORG'>Scientologists</ent> got her indicted in 1973 for
threatening to bomb the church. <ent type='PERSON'>Cooper</ent>, who also endured 19 lawsuits
by the church, was finally exonerated in 1977 after <ent type='ORG'>FBI</ent> raids on the
church offices in <ent type='GPE'>Los Angeles</ent> and <ent type='GPE'>Washington</ent> uncovered documents from
the bomb scheme. No <ent type='ORG'>Scientologists</ent> were ever tried in the matter.
For the <ent type='ORG'>TIME</ent> story, at least 10 attorneys and six private
detectives were unleashed by <ent type='ORG'>Scientology</ent> and its followers in an
.effort to threaten, harass, and discredit me. Last Oct. 12, not long
after I began this assignment, I planned to lunch with <ent type='PERSON'>Eugene Ingram</ent>,
the church's leading private eye and a former cop. <ent type='ORG'>Ingram</ent>, who was
tossed off the <ent type='GPE'>Los Angeles</ent> police force in 1981 for alleged ties to
prostitutes and drug dealers, has told me that he might be able to
arrange a meeting with church boss <ent type='PERSON'>David Miscavige</ent>. Just hours before
the lunch, the church's "national trial counsel," <ent type='PERSON'>Earle Cooley</ent>, called
to inform me that I would be eating alone.
Alone, perhaps, but not forgotten. By day's end, I later
learned, a copy of my personal credit report - with detailed
information about my bank accounts, home mortgage, credit-card
payments, home address and Social Security number - had been illegally
retrieved from a national credit bureau called <ent type='ORG'>Trans Union</ent>. The sham
company that received it, "Educational Funding Services" of Los
Angeles, gave as its address a mail drop a few blocks from
Scientology's headquarters.
The owner of the mail drop is a private eye named <ent type='PERSON'>Fred Wolfson</ent>,
who admits that an <ent type='ORG'>Ingram</ent> associate retained him to retrieve credit
reports on several individuals. <ent type='PERSON'>Wolfson</ent> says he was told that
Scientology's attorneys "had judgments against these people and were
trying to collect on them." He says now, "They are vicious people.
They are vipers." <ent type='ORG'>Ingram</ent>, though a lawyer, denies any involvement in
the scam.
During the past five months, private investigators have been
contacting acquaintances of mine, ranging from neighbors to a former
colleague, to inquire about subjects such as my health (like my credit
rating, it's excellent) and whether I've ever had trouble with the <ent type='ORG'>IRS</ent>
(unlike <ent type='ORG'>Scientology</ent>, I haven't). One neighbor was greeted at dawn
outside my <ent type='GPE'>Manhattan</ent> apartment building by two men who wanted to know
whether I lived there. I finally called <ent type='PERSON'>Cooley</ent> to demand that
<ent type='ORG'>Scientology</ent> stop the nonsense. He promised to look into it.
After that, however, an attorney subpoenaed me, while another
falsely suggested that I might own shares in a company I was reporting
about that had been taken over by <ent type='ORG'>Scientologists</ent> (he also threatened
to call the <ent type='ORG'>Securities and Exchange Commission</ent>). A close friend in
<ent type='GPE'>Los Angeles</ent> received a disturbing telephone call from a <ent type='ORG'>Scientology</ent>
staff member seeking data about me - an indication that the cult may
have illegally obtained my personal phone records. Two detectives
contacted me, posing as a friend and a relative of a so-called cult
victim, to elicit negative statements from me about <ent type='ORG'>Scientology</ent>. Some
of my conversations with them were taped, transcribed and presented by
the church in affidavits to TIME's lawyers as "proof" of my bias
against <ent type='ORG'>Scientology</ent>.
Among the comments I made to one of the detectives, who
represented himself as "<ent type='PERSON'>Harry Baxter</ent>," a friend of the victim's
family, was that "the church trains people to lie." <ent type='PERSON'>Baxter</ent> and his
colleagues are hardly in a position to dispute that observation. His
real name is <ent type='PERSON'>Barry Silvers</ent>, and he is a former investigator for the
Justice Department's <ent type='ORG'>Organized Crime Strike Force</ent>.

















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