11 Dec 2010

Australian Senate committee hears evidence from Scientology apologists and victims on public benefit test for charities

Sydney Morning Herald - AAP June 28, 2010

Scientology says it's just like Salvos


The Church of Scientology has compared itself to The Salvation Army, while defending its benefit to the community in a Senate inquiry.

The organisation was scrutinised by an inquiry into legislation proposed by independent senator Nick Xenophon, which would require religious groups to prove what public benefit they provide, before getting tax breaks.

Its representative, Virginia Stewart, told the committee its members lent a hand in times of disaster and promoted drug-free messages.

"The church believes the proposed bill is inherently flawed and puts at risk the financial future of charities and religions in Australia," she said.

But a Church of Scientology officer from New Zealand, Mike Ferris, told the inquiry that a public interest test in his country had done no harm.

Scientology has charitable status in New Zealand, where the Charity Commission of New Zealand was established in 2005.

It demands charities clear a public benefit test, and makes them hand over financial statements, which are available publicly online.

Mr Ferris said he believed the commission had been fair to the Church of Scientology.

"I think the New Zealand Charities Commission has treated us fairly," he said.

"I think it's a fair process."

The inquiry also heard from ex-Scientologists who went public with their shocking experiences earlier this year, when Senator Xenophon twice failed in efforts to have an inquiry into abuse allegations.

Among them was James Anderson, who claims he and his wife spent up to $1.2 million on Scientology materials, and Janette Vonthehoff, who says she was coerced into having abortions, and worked long hours for the organisation under duress.

Both argued the organisation should not get tax-free status, because it was completely self-serving, and provided no benefit to taxpayers.

Mr Ferris compared the glare on Scientology to that previously directed at The Salvation Army.

"They weren't welcome here in Australia, they weren't welcome in New Zealand in the early 19th century because of their view against alcohol," he said.

"They were beaten up and they were persecuted, so where do you go?"

Mr Ferris was asked why the records on the website of his country's charity commission showed the organisation went from an income of $2.6 million in 2007, to $374,000 in 2008.

"I think that drop in income, was actually, from memory, was the exchange rate drop, absolutely," he said, but later admitted he wasn't certain.

The Church of Scientology also committed to handing over its books to the committee for further scrutiny.

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Sydney Morning Herald - June 29, 2010

'Ruthless' Scientology condemned in tax debate


Former members of the Church of Scientology have told a Senate committee of the ''ruthlessness'' of the church and its judicial system, and argued it should not be eligible for tax-free status.

''Australian taxpayers should not be funding systematic, organised abuse,'' said Janette Vonthehoff, who said her passport was taken from her and she was forcibly prevented from returning to Australia from the US when eight weeks' pregnant because the organisation ordered she must finish ''training''.

Ms Vonthehoff said she resigned from the organisation in 2007 because of bullying, two coerced abortions and Scientology justice proceedings which included its own court hearings.

A Sydney tax lawyer and social identity, Louise McBride, defended the group and clashed with the independent senator Nick Xenophon during the hearing.

Senator Xenophon accused Ms McBride of being ''unprofessional'' for suggesting the committee was ''making a mockery of the law'' by considering his private member's bill. The bill seeks a tax-law amendment that would require religious and charitable organisations to meet a public benefit test.

Ms McBride said she was not a Scientologist and had never been to a Scientology church. She said, ''You are singling out a group in a government bill as the purpose of the bill. [It] is discrimination; but for parliamentary privilege, it would amount to libel.''

Another former member, James Anderson, said he and his wife had paid up to $1.2 million in Scientology training fees.

Senator Xenophon said Scientology ''auditing'' sessions were regarded by some as a cross between personal counselling and Maoist self-criticism, and had been a factor in the British Charity Commission deciding against granting it tax-free status there.

The Church of Scientology social reform director, Virginia Stewart, said the sessions made members ''a better person'', and the fee charged formed the basis of donations to the organisation.

When asked about members paying hundreds of thousands of dollars for training, Ms Stewart replied: ''I don't think courses within the Church of Scientology come to those sums.''

Australia had a proud tradition of religious tolerance and the bill would ''[put] at risk the financial future of charities and religions in Australia'', Ms Stewart said.

However, Senator Doug Cameron said there was nothing in the bill about religious freedom, and it was ''a nonsense'' to say it would be the death of Scientology.

The Scientology New Zealand representative, Mike Feriss, said a charities commission in New Zealand - with a similar public benefit test - had not impacted on Scientology's operation.

But Mr Feriss could not explain why the organisation's income fell from $2.6 million to $374,000 the year after the commission required it to publish financial statements. His first reply, that it was due to the currency exchange rate, was laughed at by the committee.

When Senator Xenophon asked the organisation if it would be concerned if organisations involved in systematic harm were given tax-free status, Ms McBride said ''Yes'', but said the same scrutiny should apply to the Catholic Church.

A lawyer for other charities, Andrew Lind, said he supported a charities commission, but warned against creating a law that applied to all charities in order to deal with one organisation.

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ABC News - Australia June 29, 2010

Inquiry hears Scientology cash siphoned overseas

A parliamentary inquiry has heard claims the Church of Scientology leaves members to fund local charitable activities out of their own pockets, as it siphons donations to church officials overseas.

The Senate committee was formed after Independent Senator Nick Xenophon raised concerns about Scientology, and proposed changes to tax law that would require religions to pass a public benefit test in order to be exempt from income tax.

The Church of Scientology says the bill is being used as a platform to continue Senator Xenophon's "witch hunt on a recognised religion".

On Monday the inquiry heard from a roundtable of five former Scientologists, who said the organisation charged its members fees of hundreds of millions of dollars, but directed very little of the money to charitable projects.

One of the group, Paul Schofield, told the inquiry he was tasked with receiving money from a program in Nepal when he was the executive director of the church's drug rehabilitation program for Australia, New Zealand and the south Pacific region.

He says the program was sponsored entirely by its executive director, a retired police superintendent.

"I wanted to request that the International Association of Scientologists help this guy out, because he wasn't able to collect money from it. He had something like 65 addicts that he was trying to treat via the Narconon program," Mr Schofield told the committee.

"He was in severe financial distress and I attempted to get the International Association of Scientologists to actually fund this. After all, the International Association of Scientologists was part of Scientology, and Scientology was using this drug rehabilitation in Nepal as an example of their outreach programs.

"I was told there would be no way in the world they would help bail this guy out, he had to handle it himself."

Mr Schofield said the director was basically broke, but was being forced to continue the rehabilitation program at his own expense and pay a tithe to Scientology.

"He was supposed to pay me 10 per cent of his money for management expenses, which I then spent: sent some to Narconon International, I sent some directly to a church body called the Association for Better Living and Education, which is a Sea Org management unit in the church.

"Although he was a charity, there was no money going to be sent to him, unless it was raised by him or people with him, and he's working in one of the poorest countries of the world."

Mr Schofield agreed when committee chair Alan Eggleston asked if his main objection was that the church was siphoning off money.


In her opening statement to the committee, Scientology spokeswoman Virginia Stewart addressed Mr Schofield's claims.

"Specifically on the topic of Narconon I would like to also mention that in August-September 2009, the International Association of Scientologists gave a grant to Narconon Nepal of over $1 million to purchase and renovate facilities for the group," she said.

"In terms of funding for the social betterment and charitable activities that the church sponsors or supports, it is true that the funds that the church does ask [for], come from its parishioners, to donate to support these organisations and activities, which is what all charitable organisations do. Where else is the money going to come from, if not its members?"

When asked later about drug rehabilitation program funding, Scientology spokesman Michael Gordon said the organisation's books were prepared by accountants and were publicly available.

The spokesman said he would be happy to provide the committee with details of what funds were sent to the head organisation in the United States.

Louise McBride, who appeared as a taxation lawyer for the church, questioned whether the inquiry was unconstitutional, saying it was not appropriate for tax amendment bills to be initiated in the Senate.

She also said the proposed amendment would determine which religions were worthy of tax exemptions and which were not, which she said flew in the face of the constitution's provisions on religion.

Ms McBride referred to a 1983 case when the High Court of Australia ruled Scientology could legally claim to be a religion.

"All the judges say, basically to paraphrase, that when bureaucrats and the government get involved with deciding what is and what isn't religion, and enacting laws that impede on that, it does go to religious freedom," she said.

The Church of Scientology also provided a statement to ABC News Online outlining its charitable programs, which include drug education and prevention, disaster relief, and work to defend human rights and promote the UN's universal declaration of human rights.

Editor's note: This article initially stated that the Church of Scientology did not provide any official comment on Mr Schofield's allegations during the inquiry's hearings. The claims were in fact mentioned in Ms Stewart's opening address to the Senate Economics Committee. The article has been amended to reflect this.

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