Leah Remini: Scientology and the Aftermath: The Conversation Continues is a series that airs extended enhanced episodes with extra information, deleted scenes and bonus unseen footage from the show "Leah Remini: Scientology and the Aftermath" that also airs on A&E TV.
Runtime: 60 minutes
Leah Remini: Scientology and the Aftermath: The Conversation Continues - Tax status of Scientology in the United States - Netflix
The tax status of the Church of Scientology in the United States has been the subject of decades of controversy and litigation. Although the Church was initially partially exempted by the Internal Revenue Service (IRS) from paying federal income tax, its two principal entities in the US lost this exemption in 1957 and 1968. This was due to concerns that church funds were being used for the private gain of its founder L. Ron Hubbard (according to the IRS) or due to an international psychiatric conspiracy against Scientology (according to Scientology). In the course of a 37-year dispute with the IRS, the church was reported to have used or planned to employ blackmail, burglary, criminal conspiracy, eavesdropping, espionage, falsification of records, fraud, front groups, harassment, money smuggling, obstruction of audits, political and media campaigns, tax evasion, theft, investigations of individual IRS officials and the instigation of more than 2,500 lawsuits in its efforts to get its tax exemption reinstated. A number of the church's most senior officials, including Hubbard's wife, were eventually jailed for crimes against the United States government related to the anti-IRS campaign. The IRS, for its part, carried out criminal investigations of the church and its leaders for suspected tax fraud and targeted the church as a “dissident group” during the Nixon administration. Although the church repeatedly lost in legal cases which were heard up to the level of the Supreme Court, it undertook negotiations with the IRS from 1991 to find a settlement. In October 1993, the church and the IRS reached an agreement under which the church discontinued all of its litigation against the IRS and paid $12.5 million to settle a tax debt said to be around a billion dollars, and the IRS granted 153 Scientology-related corporate entities tax exemption and the right to declare their own subordinate organizations tax-exempt in future. The terms and circumstances of the agreement remained secret until details emerged through leaks and litigation from 1997 onwards. They have attracted controversy for their perceived favorability towards the church and have been described as unconstitutional by federal courts for their bestowal of privileges on Scientologists that are shared by no other religious group. Questions have also been raised about whether the IRS exceeded its authority by effectively overruling the Supreme Court in setting the terms of the agreement and permitting tax deductions not authorized in law. However, legal commentators have concluded that the agreement can effectively no longer be challenged in court.
Leah Remini: Scientology and the Aftermath: The Conversation Continues - Espionage - Netflix
While the church was fighting the IRS in the courts, it also mounted a sophisticated seven-year campaign of espionage against the agency and numerous other government and business organizations in the US, Canada, UK and other countries. Its methods included burglaries, electronic eavesdropping, infiltration and theft of government documents on a massive scale. The campaign was intended to bolster its effort to regain tax exemption, but ended disastrously for the church when it was exposed and led to the imprisonment of some of its most senior leaders, including Hubbard's wife Mary Sue. The church's espionage campaign was run by the Guardian Office (GO), a department of the church established by Hubbard in 1966. It took over the mission of the church's short-lived Public Investigation Section to “help LRH [Hubbard] investigate public matters and individuals which seem to impede human liberty so that such matters may be exposed and to furnish intelligence required in guiding the progress of Scientology.” He instructed its staff to target critics of Scientology and “start investigating them promptly for FELONIES or worse using own professionals, not outside agencies ... Start feeding lurid, blood sex crime [sic] actual evidence on the attackers to the press.” He also ordered his followers to “bring the government and hostile philosophies or societies into a state of complete compliance with the goals of Scientology. This is done by high level ability to control, and in its absence, by low level ability to overwhelm. Introvert such agencies. Control such agencies.” The GO was headed by Mary Sue Hubbard, the “Commodore Staff Guardian” (Hubbard was the “Commodore”), with Jane Kember carrying out day-to-day management as the Guardian World Wide. It employed Scientologist volunteers as agents to help it carry out intelligence operations against its targets. In April 1972 the GO developed a three-pronged strategy to target the IRS. Several intelligence operations were instigated: Operation Search and Destroy targeted organizations and individuals providing information to the IRS. The GO would use overt or covert means to obtain information which could be used to discredit them, while avoiding any disclosure of Scientology's involvement. The GO had already obtained information on IRS informants and sought to expand its coverage. Operation Random Harvest sought to document criminal activity on the part of the IRS. Operation Paris aimed to identify individual IRS officials working on Scientology tax matters and investigate their background and activities. A 'plant' would be recruited to develop social and political contacts with IRS personnel. Operation Juicy Clanger targeted tax records of prominent politicians and celebrities. Scientology operatives infiltrated the Los Angeles offices of the IRS and stole confidential files on California's governor Jerry Brown, Los Angeles' mayor Tom Bradley, the singer Frank Sinatra and the actress Doris Day, as well as attempting to steal John Wayne's tax records. The church appears to have intended to blackmail the IRS; the operation envisaged the church pretending that it had received the stolen tax records from a whistleblower and threatening to release them to create what the plans described as “an additional pressure on [the IRS] to finish the audit [of Scientology tax matters] favorably”. A number of other espionage “projects” – subplans of wider operations against the IRS – were also developed: Project Horn was a plan to covertly release stolen documents without revealing the thieves' identity. The records of other taxpayers would be stolen and released along with those of the Church of Scientology. A GO operative within the IRS was instructed to steal letterheaded stationery from the agency so that letters could be forged in the name of a non-existent whistleblower supposedly responsible for the leaks. The operative did so and also stole tax records for Bob Jones University and the Unification Church. Project Beetle Cleanup called for the theft of “all DC IRS files on LRH, Scientology, etc., in the Intelligence section, OIO [Office of International Operations], and SSS [Special Services Staff]”. It ordered the placement of agents in the “required areas or good access developed”. Project Troy was aimed “to get prediction on future IRS actions” by planting a permanent bugging device in the office of the IRS Chief Counsel. Information acquired by eavesdropping would be used to brief the church's lawyers to mount defensive actions.
In October 1974 the GO set out a plan – Guardian Order 1361 – to infiltrate IRS offices in Los Angeles, Washington and London, steal files on Scientology and Hubbard and develop a cover story to disguise how the information was obtained. To address a situation that it summarized as the IRS “persisting in its attack upon the C of S and LRH ... despite extensive legal and PR handling”, it set out an “ideal scene” envisaging “[the] IRS with no false reports in their files on Scientology, uninterested in Scientology taxes, other than as a routine matter, doing their jobs and busy elsewhere with the usual red tape of a bureaucracy, with the psychotics located and their influence eliminated.” It called for the GO to “immediately get an agent into DC IRS to obtain files on LRH, Scientology, etc. in the Chief Council's [sic] office, the Special Services staff, the intelligence division, Audit Division, and any other areas.” The agent was to obtain “every single false report in every single IRS file. Once the data has been revealed, the lies can be corrected, the SPs [Suppressive Persons] isolated and handled, further PR and legal actions initiated and the IRS attack turned off.” Scientology operatives broke into the room in the IRS's headquarters building where staff credentials were made and created fake credentials for other operatives to use. The following month, the operatives infiltrated the office of the IRS's Chief Counsel and planted an electronic listening device to eavedrop on a meeting of senior IRS officials dealing with the church's tax affairs. They parked outside in the Smithsonian Institution's driveway and recorded the proceedings via their car's FM radio. The GO also used the Freedom of Information Act (FOIA) to manipulate the IRS into making it easier for Scientology agents to steal documents. FOIA requests were made to the IRS in the belief that it would result in all of its Scientology files being collated in one place so that IRS attorneys could review them. Scientology agents could then burgle the office where they were being held and obtain them. This plan was successful, and Scientology operatives reported that they had gained access to all of the documents held by the IRS's FOIA attorney. By May 1975, the operatives had stolen more than 30,000 pages of documents, equivalent to a stack of paper ten feet (3.0 m) high, on Scientology and the Hubbards. A key objective of the GO's campaign was to uncover the individual who Hubbard believed was responsible for the IRS “attack” on Scientology. He told his followers that the IRS's interest in Scientology was due to “an insane individual with insane plans” who was operating a “false reports factory.” He ordered the GO in June 1975 to “find the who back of these IRS attacks and document it for exposure plus all other items of interest. It could be IRS and the government is attacking any vocal group to pave the way for some coup by the government. Evidence as to the why of these attacks must be gotten, powerful enough to destroy the attackers when eventually used or revealed.” By the mid-1970s the church's senior leadership had become increasingly concerned that Hubbard himself faced possible indictment for tax evasion. He wrote a secret minute to the Guardian Office on November 26, 1975 in which he told the GO: “WE COUNT ON YOU GUYS TO MOW THE IRS DOWN AND WIN ACROSS THE BOARDS”. A month later, the GO issued Guardian Program Order 158, “Early Warning System”, ordering the establishment of a monitoring system “so that any situation concerning governments or courts by reason of suits is known in adequate time to take defensive actions to suddenly raise the level on LRH Personal Security very high”. An agent was to be inserted into the IRS Office of International Operations, whose files on L. Ron and Mary Sue Hubbard and the Church of Scientology were to be obtained. At the time, Hubbard was living in seclusion in La Quinta, California to avoid possible process servers and government agents. The GO initiated a new intelligence program against the IRS codenamed “Off The Hook” in June 1976, intended to get Scientology “off the hook, future threat nullified”. It called for continued monitoring of IRS handling of Scientology tax exemption applications “on [Guardian Order] 1361 lines” – i.e. through the use of infiltration and theft of information – and ordered GO operatives to “ensure all attack preparation is completed and honed to razor sharp edge” in the event of any of the applications being denied. A program was also put in place to ensure “Founder's Protection from IRS Attack”, requiring the “1361 Collection line” – the burglary team – to keep a close watch on the section of the IRS dealing with Hubbard's tax returns. On one occasion, the GO's espionage operation was nearly discovered by a cleaning lady who interrupted a burglary team at the IRS headquarters. She became suspicious and called a security guard, but the operatives were able to satisfy him of their credentials and persuaded him to open the locked door of the office they were trying to burgle. They were not so lucky in June 1976 when a more alert security guard caught a GO operative in the building. The operative was released and a warrant was issued for his arrest, prompting the GO to move him to a safe house where he was put under a round-the-clock guard. He lived as a fugitive for eight months until he became so disgruntled by his virtual imprisonment that he escaped and went voluntarily to the FBI to make a confession. A further misfortune befell the GO in July 1977 when a case containing secret documents about its burglaries of IRS offices in Washington was accidentally left in a Los Angeles parking lot. An attorney handed it in to the IRS. The exposure of the GO's operations led to one of the largest raids conducted by the FBI up to that time. On July 7, 1977, scores of FBI agents simultaneously raided Scientology premises in Washington and Los Angeles. The documents they seized revealed the scale of the GO's illegal activities and resulted in the imprisonment of eleven senior Scientologists, including Mary Sue Hubbard, for conspiracy against the United States.
Leah Remini: Scientology and the Aftermath: The Conversation Continues - References - Netflix