Presenting Rod Keller's
Alt.religion.scientology Week in Review

Volume 6, Issue 5 - May 20 2001

Chick Corea

The Boston Globe published an article on Scientology celebrity Chick Corea on May 20th. "Soon to be 60, Corea plays 200 concerts a year. His appearances with the Boston Pops Wednesday and Friday finally provide the opportunity for Corea to claim a piece of turf near his boyhood home at 149 Chestnut St. Now he has a 30-concert European solo tour scheduled for late in the year that will take him to Germany for the first time since 1993, when his practice of Scientology led to what he describes as a government-inspired boycott of his music. "'It was a campaign created by a handful of people in the German government who scared promoters into not booking me,' Corea says of the situation. 'It led me to visit D.C. several times, not just to present my own case but to talk about all of the human rights violations that go on in so-called civilized countries like Germany and France.' "According to Corea, the US State Department 'went to bat' on his behalf. He also lowered his price, allowing promoters to operate without government subsidy. Scientology remains a large part of Corea's life. He and his wife, Gayle Moran, moved to Clearwater, Fla., four years ago after participating in several retreats at the Scientology Center located there. The affiliation has raised eyebrows for decades, yet Corea insists it has not inhibited his ability to work in this country. "'My involvement with Scientology has been nothing but glorious since 1968,' he says. 'Anything this new has always been attacked - not by the public, but by the press as tools of the government. But this is my own subjective thing, and being a Scientologist has done nothing but help me in my life.'" Message-ID:


Mark Bunker and Jeff Jacobsen reported on the opening of a city park in downtown Clearwater. A Scientology group was responsible for improvements to the park, but initially declined contributions in honor of Lisa McPherson, Roxanne Friend and Congressman Leo J. Ryan. "At this afternoon's grand opening of the brick alley in Downtown Clearwater, Pam Marks finally answered the question she refused to answer for the St. Pete Times. The secret committee has been revealed. Pam Marks today thanked Bennetta Slaughter and AMC for being in charge of placing the orders for bricks. Pam Marks also applauded the local newspapers for their supportive coverage, except for the St. Pete Times. She lambasted the Times and O'Neal in particular for their biased coverage." "I was on the Cleveland Street entrance with my Lisa McPherson picket sign. I was there in place of my brick that would have said 'Remember Lisa McPherson' except the Citizens for a Better Clearwater rejected that brick as being disharmonious to the community. So I stood near the curb with my sign and flyers that explained why I was there. I only gave out one flyer. It was essentially impossible to miss my sign if you were in the park because there are of course only 2 entrances into the park. "Antonio the Scientology security guy was all excited and videotaped the first 45 minutes of me standing there, then just watched the rest of the time. Paul Kellerhals came over and watched me quite a while, then came over with a copy of the injunction and claimed I was violating it! Clearwater police Lt. Hall came over a few minutes later, apparently called there by Scientology. He talked to me briefly, saw what I was doing, and told the nearby cops that I was fine. "After a bit a nice lady came and told me that my brick was now in the park! Sure enough, it's right at the base of a bench, in a reasonably good location." Jeff Jacobsen also spoke at a Clearwater City Council meeting this week. "I'd like to point out a deception that happened in a city commission meeting last August 17. Mary DeMoss spoke at the meeting and explained that she was creating the Foundation for Religious Tolerance here in Clearwater. She said the goals of the Foundation would be to promote human rights, unite the local religious groups, bring the city and religions together, and help forward the goals of the city. "The most recent Scientology publication called Free Winds has a letter signed M.D. talking about how this person found her home town had some SP's in it. 'I began to attack them. My attacks turned into the Foundation for Religious Tolerance which I founded. This foundation confronts any critics of Scientology and exposes them for what they really are - hate groups. Would you like to know how many people comprise this vast worldwide organization that has the SPs running scared? Just one, me!' "The Foundation for Religious Tolerance claims to be a wonderful organization designed by a Scientologist to help unite the Clearwater community, but in her own words, it is a front group for Scientology to attack its critics. In that case Ms. DeMoss lied to the commission and the people of Clearwater last August 17. "The Citizens for a Better Clearwater rejected a brick order I placed for the new Alley Park. My brick was to say 'Remember Lisa McPherson.' This was rejected, said a letter from CBC treasurer Doug Williams, because it would cause community disharmony. CBC finally relented and my brick is now in the park, What exactly does this episode say about Citizens for a Better Clearwater?" Message-ID: 3b01b2ac$ Message-ID: Message-ID:

Eagle Scout

The Los Angeles Times reported on May 19th that an Eagle Scout ceremony was held at a Scientology location in Hollywood. "John Steiner, son of Louis Steiner, has earned the rank of Eagle Scout. He is a member of Glendale Troop 8 and received his award at a ceremony held at the Church of Scientology in Hollywood. Among those attending the celebration were his grandmothers, Yvonne Steiner of Maryland and Velma Ballerini of Washington, D.C. "For his Eagle Scout service project, he repaired a large section of trail in the Angeles National Forest. The task was organized by John and involved more than 570 man hours of work by parents and Scouts." Message-ID: 9e6ahd$

Entertainment Tonight

Entertainment Tonight aired an interview with Scientology celebrities Jenna Elfman and Kirstie Allie on May 15th. "Kirstie said 'nothing great on this planet goes unattacked.'" "Kirstie says about her marriage counselor role on Dharma & Greg: 'No. I'm a flake. I don't like marriage counselors, so it's fun to play these. I'm not a big shrink advocate or counselor advocate, so I like playing them when they're idiots.' "'You know what, here's the thing. People can attack my religion if they want, they are showing that they are not very bright. Because if they actually investigated it, and read one of the books, they would see that it's very beautiful.'" Message-ID: 3b033f8c$ Message-ID: LQiM6.3016$

Jesse Prince

The St. Petersburg Times reported on May 19th that details of Scientology's PIs working to investigate Jesse Prince have been revealed during depositions in his marijuana growing case. "Depositions in the case taken earlier this week show private investigators hired by Church of Scientology lawyers watched, videotaped and trailed Prince virtually every day for at least four months, following him 'almost wherever you can think of in the area,' said Brian Raftery, the private investigator. Another private investigator involved in the case said they were looking for 'immoral activities and the possibility of illegal activities.' "The elaborate surveillance effort involved at least three private investigators, one of whom befriended Prince by using a false name. Prince's Clearwater attorney, Denis deVlaming, says it's clear the church wants to intimidate his client and label him a criminal. 'Everything we've learned about this case was the Church of Scientology was behind it from the very beginning,' deVlaming said Thursday in court. "The effort to conduct surveillance on Prince included hiring a black private investigator named Barry Gaston, Raftery said in his deposition. Prince also is black. Gaston was hired in February 2000 by another private investigator, Joseph Fabrizio, who worked for Kobrin's firm. "The depositions show Fabrizio supplied Gaston with a photograph of Prince and information about where Prince might show up. Gaston hung out in those places for weeks before he finally spotted Prince and his girlfriend at Wilson's Lounge on Belcher Road. As Prince was leaving, he stopped and introduced himself to Gaston. Gaston introduced himself as 'Rinzy Trinidad,' a name he made up. Eventually, Prince invited Gaston to his house, where Gaston saw Prince smoke marijuana, according to Gaston's deposition." Message-ID: 9e5uhe$

Keith Henson

The Riverside Press-Enterprise reported on May 17th that Keith Henson failed to appear for a sentencing hearing in Hemet, California. Keith was convicted of interfering with a religion. "A man convicted in April of oppressing Scientologists because of their religion has fled to Canada to apply for political refugee status, the man said Wednesday. Henson's conviction on a charge of interfering with a religion stemmed from his picketing at the Church of Scientology's Golden Era Productions in Gilman Hot Springs. "Henson said in a phone interview Wednesday night from Canada that he went there to protest a Scientology event. He then decided he would stay after talking to an immigration lawyer. Henson said his human rights have been violated because of a recommended sentence that could put him in jail for 200 days and subject him to five years' probation for a misdemeanor crime. He said the sentence would be too harsh. "Riverside County Superior Court Judge Robert Wallerstein issued a no-bail arrest warrant for Henson. The judge postponed the sentencing until Henson is arrested and can explain where he has been and why he didn't come to court." Gregg Hagglund reported on the possibility of refugee status in Canada. "Keith Henson today retained the services of Canadian Immigration Lawyer and Specialist: Mr. Guidy Mamann of Mamann & Associates. Keith Henson is seeking Refugee Status after having been made a Political Prisoner of Conscience. Mr. Henson chose to seek refuge in Canada as that nation has previously criminally convicted corporate Scientology for Breaches of the Public Trust. Mr. Henson also has extensive personal contacts amongst consumer and religious activists opposed to Scientology abuses in Canada." Scientology lawyer Elliot Abelson wrote a letter to the Hemet court, asking for a stiff sentence for Keith Henson. "On behalf of the victim, we sincerely urge that Henson, an admitted explosives expert, be sentenced to a minimum of six months of incarceration (if not the full one year term) to be followed by probation, a condition of which to be that for five years thereafter, Henson shall stay at least 100 yards away from any Scientology church, housing unit where Scientologists reside, or other facility, and that he be barred from inducing or encouraging others to ether within that zone. "Henson is a sociopath, but a very smart one, who has exploited and misused the legal system for his personal agenda. In my 33 years of practicing law as both a prosecutor and defense attorney, Henson is one of the most dangerous criminals I have seen. "The lessons of Oklahoma City and Columbine fill the press on a daily basis. In both cases there were early warning signs which went unheeded. We must not let that happen again as Henson has the expertise to carry out his threats." The Register published an article on the case on May 19th. "A couple of weeks ago computer engineer Keith Henson was found guilty in California of a criminal act related to posts he made in the newsgroup alt.religion.scientology, which contained obviously comical references to targeting Scientologists with a nuclear missile. The jury convicted him of interfering with a religion but failed to reach a decision on two other patently idiotic charges brought by Deputy District Attorney Robert Schwarz. "Henson's trial has been roundly condemned as a true kangaroo court affair, with serious irregularities of procedure favoring the prosecution and excluding the bulk of Henson's evidence, thereby virtually shutting down the defense. Henson skipped to Canada and set up in Toronto. He's since retained a local lawyer through whom he filed for political asylum with the Canadian government. "Here's a guy who hails from a country that bleats about democracy and liberty 'til it's blue in the face, lectures the world on human rights like a scolding nanny at every opportunity, and then convicts a fellow for exercising his right to criticize, protest and picket against an immensely well-heeled, and some say, immensely dangerous, cult. 'Democracy' and 'liberty' in the sunny State of California never looked more like the empty incantations they really are." Message-ID: 9e0op7$ Message-ID: Message-ID: Message-ID:

Tom Padgett

An affidavit by Dr. Stephen Kent was posted to a.r.s this week. It is being submitted in Tom Padgett's legal cases. "My professional specialization is in the area of alternative religions. I have worked specifically in this area at the University of Alberta for the past thirteen years. Scientology is among the groups that I have studied. I began formal studies of Scientology in 1986, and since then have published several articles on Scientology and referred to it in still others. "In light of my professional publications and my knowledge of Scientology practices, I am qualified to speak about Scientology's use of the legal system against perceived opponents as a means of harassment according to what it used to call the 'fair game' policy. In addition, I can speak about Scientology's practice of 'disconnection.' In my professional opinion, Mr. Thomas Padgett has been victimized by Scientologists' application of 'fair game' and 'disconnection policies. "A crucial document for understanding Scientology's harassing legal strategy is the Hubbard Communications Office Policy Letter 'Suppressive Acts, Suppression of Scientology and Scientologists, The Fair Game Law.' According to Scientology policy, Mr. Padgett is a 'suppressive person.' The definition given in a Scientology Policy Letter of this term is: 'A SUPPRESSIVE PERSON or GROUP is one that actively seeks to suppress or damage Scientology or a Scientologist by Suppressive Acts.' "Several of the acts that Hubbard specified were such that Scientology leaders would see Mr. Padgett as a suppressive person committing suppressive acts. Suppressive Acts include: 'reporting or threatening to report Scientology or Scientologists to civil authorities in an effort to suppress Scientology or Scientologists from practicing standard Scientology;' and 'engaging in malicious rumour-mongering to destroy the authority or repute of higher officers or the leading names of Scientology;' and 'delivering up the person of a Scientologist without defense or protest to the demands of civil or criminal law.' "Consequently, Mr. Padgett is a 'Suppressive Person' and therefore also is a 'fair game' target. Indeed, in an October 28, 1999 affidavit by Mr. Padgett filed in Commonwealth of Kentucky vs. Thomas, he stated that he learned from the Nashville, Tennessee Scientology Celebrity Center that the Scientology organization had in fact declared him to be a suppressive person. "An L. Ron Hubbard article is entitled, 'The Scientologist: A Manual on the Dissemination of Material.' This item is required reading in the 1991 'Department of Special Affairs, Investigations Officer, Full Hat' course. The paragraph instructing Scientologists to defend only by attacking, even in a court of law, outlines the behaviour that I believe explains many of the current legal and social situations burdening of Mr. Padgett. It states: 'The DEFENSE of anything is UNTENABLE. The only way to defend anything is to ATTACK, and if you ever forget that, then you will lose every battle you are ever engaged in, whether it is in terms of personal conversation, public debate, or a court of law. NEVER BE INTERESTED IN CHARGES. DO, yourself, much MORE CHARGING, and you will WIN. Don't ever let them have any other thought than that Scientology takes all of its objectives. The law can be used very easily to harass, and enough harassment on somebody who is simply on the thin edge anyway, well knowing that he is not authorized, will be generally sufficient to cause his professional decease. If possible, ruin him utterly. "Much of the harassment that Mr. Padgett has endured while engaged in legal actions with his former wife, Laura Vannoy Padgett, has been committed by anonymous perpetrators. In the police report filed after Mr. Padgett found that items inside his garage had been vandalized, the officer stated, 'written on the newspaper sheet in print were the words, 'SHUT THE FUCK UP'.' The underlined letters, 'SP' are the same as 'suppressive person,' which has very definite meaning in Scientology. "Mr. Padgett's designation as a suppressive person has important implications for the manner in which Scientologists would view his contact with his the children. Again according to Scientology's definitions, these children would become 'potential trouble sources' because of their extended contact with their father. As Scientology defines the term, a 'Potential Trouble Source' is '[a] person who is in some way connected to and being adversely affected by a suppressive person. He is called a potential trouble source because he can be a lot of trouble to himself and others'. "Mr. Padgett has every reason to believe that his ex-wife is attempting to minimize if not prevent him from having contact with his children. In essence, the children would become 'potential trouble sources' from that contact, which in turn would cause problems for the mother in her Scientology activities. Indeed, the current situation regarding his children - in which his former wife has sole custody and Mr. Padgett has restricted visitation - amounts, functionally, to being 'disconnected' from his children. Likewise, Mr. Padgett has reason to fear that his former wife might be attempting to turn their children against him." Message-ID:

Dianetics Day

A report from a Scientologist who attended the May 12th Dianetics Day celebration in Toronto was posted this week by Gregg Hagglund. "Doors finally opened at about 7:30, half an hour late, and ushers from Toronto Org showed us to seats, before a screen which was showing a video about 'The Auditors' and how really great they are, and how they are the only ones who are going to be able save the world, and a large poster of Ron Hubbard, just off to one side. "The main video started after about 15 minutes, and dealt with the history of 51 years of Dianetics. 'One Man, One Dream' was a recurring theme, and great emphasis was being put on how many new groups in many countries were now taking up Dianetics study, and who in those countries was endorsing these studies, (military officers, politicians, and so on) and how there are groups in such places as Vietnam, Bosnia, the old Soviet Union, and several African Countries. "Mostly it was boring, with middle-age males and teen or early 20's girls all pushing the latest volumes of the books and courses. A lot of the older crowd seemed to be staff, or their kids, and I figure there were about 200 in attendance during the video. During the refreshments after, there were about 50 staff and perhaps a dozen others who lined up for the piece of cake and coffee, and more hard sell on the 'package deal' 30% off on course materials and FREE advanced training related to it." Message-ID:

Protest Summary

Keith Henson reported a protest at a Toronto hotel this week. "We went to downtown Toronto to picket the Colony Hotel where a dianetics meeting was being held. Jacky Matz, who ran the spy ring and was convicted to two counts of breach of the public trust, was waiting outside. Gregg said hi to her and introduced me. Her face fell and she split inside no doubt to make a panic call to Hemet. "We had 6 people, so we put a group on both the front and back door. They put Andy Hill on me. He asked a few questions and I gave him the concentrated lecture ranging over how I was brought into the battle, the long list of criminal activities by scientology that keeps us in the fight and a range of other topics, particularly the evolved psychological mechanisms scientology and other cults use to get people hooked and keep them. He was polite and attentive. Then they assigned Brian McPherson to me. He too was attentive as I went over much the same subjects I had with Andy. "At one point they were triple teaming against Gregg with Gwen Jones (Velcro Kitty), Bob Hill, and Dan Bryenton. Dan was highly agitated, near to violence, yelling, bumping into Gregg, threatening to have Gregg arrested if he ever went near Dan's house. "We decided to call it a picket about 7:45 and walked around back to collect the rest of the crew. When we got around there, there were more of the OSA Goon Squad mixed in with our people. So Gregg and I brought all of them up on the latest news about Reed Slatkin. A little after 8 pm the rest of the handlers came hunting for their missing people. There were all together 6 SPs and 10 handlers involved in this picket." Keith Henson and Gregg Hagglund reported a protest at the Toronto Org on May 18th. "Gregg and I put in a substantial picket. We had the first half hour by ourselves, out in front of the org doing a good business in handing our flyers, After that we got our regular 'handlers,' Brian McPherson and Daffy Dan. At one point when Brian was inside I went over to Dan and tried to get up close to him the way he and Gregg were always doing. No reaction, the guy just moved back. Gregg thinks Dan is nearly out of control, but I tend to think he is just playing a silly emotional game." "The Dianetics bookstore has now been completely expanded into the old restaurant. This means they have twice as much absolutely empty space. The front lobby entrance of the Org had boxes piled up from Golden Era. The boxes were the size and type for standard flyers and such. Several of the boxes were clearly labeled 'SOS Letter Stuffers.' They were labeled as 3000 per box and there were at least 10 boxes. "Briney spent the next hour walking and talking with Keith. Again Briney. who admits he reads ARS, displayed no fear of Keith, even laughing at the idea Keith might be carrying an ICBM. Dirty Dan showed up about 35 minutes after we started. He wasn't very happy being called in from his job. He tried to be intimidating, but since he didn't have his fellow thugs for support he was a little less bold. Dan tried a few times to get physically close to me to use his cigarette, hostile demeanor and sickening body odor as a weapon. I kept him at arms length by using my sign to block his approach. Keith and I called it quits after about one hour." Message-ID: Message-ID: Message-ID:

The Profit

Patricia Greenway reported this week from the Cannes Film Festival, where The Profit is being screened to invitees. "There are 4000 members of the press here in Cannes and the fact that Scientology has tried so hard to stop the film, we are getting far more 'hard news' coverage than any new film at the festival. Most of the press that we've talked to are appalled at the lengths to which Scientology has gone in their efforts to condemn and suppress both the production and the release of this movie. "German TV, ZDF did quite an interesting piece on Peter and The Profit while capturing Peter's tail on film. Then on Saturday, Le Figaro, one of the largest nationwide newspapers in France did a great article on the film and Scn's attempts to stop it. By Sunday, Europe 1, a nationwide radio show ran a great interview with Peter after attending the first screening of 'The Profit'. "Sunday night, Scn showed its desperation by sending in an investigator to our hotel to forge Peter's signature and steal a delivery of trailer videos that had been sent from our office in the States. Both the Cannes police and the Security for the Cannes Film Festival informed us that they were very familiar with OSA and were more than interested in pursuing our complaint. This morning, Radio Monte Carlo, the biggest English speaking station in the area was at our hotel for a full report on the theft. "Today I spent an hour with the good Reverend Jesse Jackson, explaining the cult of Scn and discussing ad nauseum the faith based initiatives (which he opposes). Rev. Jackson invited me to a screening of the documentary that he's involved with here and good ideas were exchanged." "Tonight on French national TV Channel 3, they will be doing a short piece on THE PROFIT and the attempts by Scn to stop the film. A reporter from Reuters who interviewed me said The Profit was the only film at Cannes getting this much 'hard news' coverage. The Chief of Police in Cannes is handling our case personally. Our hotel's security system picked up the entire crime so they have provided a bunch of pictures to the police. "We've received calls from a fake distributor, an American using the name Mike Silverman called on our European cell phone and said he was a film distributor from Dallas, Texas with a company named Omni-view. Of course the company doesn't exist. We'd already anticipated Scn's plans to buy the film rights in order to shelve it." Message-ID: Message-ID:


The Associated Press reported on May 18th that a Russian court has dismissed an attempt by prosecutors to shut down Scientology in Moscow. "Prosecutors had accused the Humanitarian Hubbard Center of tax evasion and conducting illegal business activities, the Interfax news agency reported. Moscow's northeastern circuit court upheld a Tuesday ruling rejecting the charges against the group, it said. Prosecutors moved against the Hubbard Center in 1999 because names that appeared on registration documents were found to have no relation to the center. The center said it corrected the documents." Message-ID:

Reed Slatkin

The Los Angeles Times reported on May 14th that the investigation is continuing into alleged fraud by Scientologist Reed Slatkin against a group of investors that included many other Scientologists. "The Hollywood insiders, Internet entrepreneurs and just plain folks who turned to Slatkin for help with their investments now are trying to find out what happened to the hundreds of millions of dollars they entrusted to a man who wasn't even a registered investment advisor. The 52-year-old Slatkin, a co-founder of Internet provider EarthLink and a Santa Barbara socialite, is under investigation by the Securities and Exchange Commission for investment fraud. He also faces lawsuits by investors and filed for Chapter 11 bankruptcy two weeks ago. "Federal investigators raided his office Friday, but have been able to locate only a fraction of the money Slatkin controlled, and investors' claims eventually could surpass $600 million, officials say. Indeed, government investigators say the collapse of his investment empire may be one of the largest Ponzi schemes they've ever encountered. "These friends say Slatkin didn't start out to become an investment guru. Instead, his first passion was the Church of Scientology. In a deposition given to the SEC in January 2000, Slatkin traced his interest in Scientology to his father's death when Slatkin was 14. An uncle introduced Slatkin and his Detroit family to the religion's tenets, and Slatkin's growing interest took him to England, where he spent two summers during high school studying at Scientology founder L. Ron Hubbard's institute in Sussex. Slatkin came to Los Angeles in 1974 and worked at Scientology's Celebrity Centre and became an ordained minister of the church. "Long hours and low pay eventually took their toll, Slatkin told the SEC. In 1983, he began learning from another Scientologist about how to make money in the stock market. By 1985, he was investing for a small group of fellow Scientologists, describing his work as an extension of his 'church-related efforts' to help ensure others' financial stability. Investors said they were told their money would be pooled with other investor funds to buy stocks, according to SEC documents. "Slatkin's big break as a venture capitalist came in 1994, when he was approached by fellow Scientologist Kevin O'Donnell, whose son had gone to school with a young man named Sky Dayton. Dayton, then 22, wanted to start a business that would make it easier to get on the Internet. The company they founded, EarthLink Networks, would go on to become one of the nation's three largest Internet service providers. By February 2000, Slatkin's stake in the company would be worth more than $122 million. fund-raising events, investors' attorneys say. "Slatkin's reach extended into Hollywood, thanks to his Scientology connections and to O'Donnell's investment in 1999 in Beacon Communications, a film production company headed by Armyan Bernstein. Beacon made the Harrison Ford thriller 'Air Force One,' as well as Costner's 'For Love of the Game' and the Schwarzenegger vehicle 'End of Days.' "Among the investors Slatkin named to the SEC were Jeffrey Tambor, who most recently portrayed the mayor of Whoville in 'Dr. Seuss' How the Grinch Stole Christmas'; actor Giovanni Ribisi, whose movies include 'Boiler Room' and 'Saving Private Ryan'; and several producers." From the New York Post on May 15th: "Talk about getting audited. Earthlink co-founder, Hollywood money manager and top Scientologist Reed Slatkin, was hit with a SEC lawsuit Friday which charged that he operated a $230 million Ponzi scheme. The civil lawsuit alleges that Slatkin committed fraud while acting as an unregistered investment adviser. At the same time, FBI and IRS agents raided Slatkin's offices looking for the money. "He is alleged to have used some of the money to pay his country club fees, credit card bills and pool maintenance. The SEC, which won a court order to freeze his assets, says Slatkin had just $30 million in his brokerage accounts. Others who invested with the ordained minster of the Church of Scientology were Earthlink Chairman Sky Dayton and CEO Garry Betty." From the SEC litigation release on May 11th: "The Commission's complaint alleges that in February 2001, Slatkin misappropriated $10 million in client funds that he had received purportedly to invest in a money market fund and misused the client's funds by using $6.975 million to pay other clients and using over $24,000 to pay personal expenses, including credit card bills, telephone and other utility bills, fees at two country clubs, and pool maintenance fees. The Commission further alleges that the Swiss trading accounts do not exist and that Slatkin was merely operating a fraudulent securities scheme. "The Commission's complaint alleges that Slatkin violated and is continuing to violate the antifraud provisions of the Securities Act of 1933, Securities Exchange Act of 1934, the Investment Advisers Act of 1940 and the Investment Advisers Act. In addition to the temporary restraining order and asset freeze, the court ordered Slatkin to not destroy documents and to produce an accounting. The Commission is also seeking a preliminary injunction, a permanent injunction, disgorgement, and civil penalties." A trustee has been named in the case to prevent any more money from disappearing from Slatkin's accounts. From the Los Angeles Times on May 17th: "In a move to preserve what's left of Reed E. Slatkin's crumbling financial empire, a U.S. Bankruptcy Court judge Wednesday named veteran forensic accountant and former FBI agent R. Todd Neilson as trustee for Slatkin's Chapter 11 case. Regulators and investors had pressed for the emergency appointment after the FBI and Internal Revenue Service raided Slatkin's offices and the Securities and Exchange Commission obtained a court order freezing his assets Friday. Investor attorney Richard Wynne said the appointment of a trustee was needed to ensure that Slatkin, a co-founder of EarthLink Inc., did not regain control of his assets. 'We frankly do not trust Mr. Slatkin,' Wynne, attorney for the creditors' committee that represents investors, told Bankruptcy Judge Robin Riblet. 'There's $300 million to $600 million that's missing that cannot be accounted for.' "Among the investors listed in SEC documents are CNN legal commentator Greta Van Susteren and her husband, attorney John Coale; actors Giovanni Ribisi, Mariah O'Brien-Ribisi and Jeffrey Tambor; former Capitol Records chief Hale Milgrim; and Oscar-nominated songwriter Tom Snow, whose compositions include the Pointer Sisters' hit 'He's So Shy' and 'Let's Hear It for the Boy' from the movie 'Footloose.' "Slatkin's bankruptcy attorney, Richard Pachulski, asked Riblet to convert Slatkin's Chapter 11 filing to a Chapter 7 liquidation, a move Riblet initially approved Wednesday before the hearing. "A Chapter 7 filing requires the appointment of a trustee but makes it more difficult for creditors to have a voice in the liquidation process, bankruptcy attorneys said." Message-ID: 9dorvq$ Message-ID: 9drok4$ Message-ID: 9dser9$ Message-ID: 9e0rb2$

U.S. Trade Representative

The Federal Register on May 7th published a report by the U.S. Trade Representative on discrimination in foreign government purchasing practices. "A long-standing objective of U.S. trade policy has been to open opportunities for U.S. suppliers to compete on a level playing field for foreign government contracts. The WTO estimates that the United States and the 26 other GPA Parties provide their suppliers with non-discriminatory access to government tendering procedures worth more that $300 billion annually. "Germany - 'Sect Filters': In September 1998, the German Ministry of Economics promulgated a 'protection clause' (commonly referred to as a 'sect filter') meant to be incorporated into government contracts for certain training and consultation services. Among other elements, the clause would have prohibited firms from bidding on German government contracts if they have employees that attend or participate in Scientology seminars. Following the promulgation of this 'protection clause,' the United States expressed concern in bilateral consultations and in the 2000 Title VII report about the clause's potentially discriminatory effects on government procurement. In subsequent consultations with German government and industry representatives, the Administration urged Germany to rescind the sect filter requirements. "In response, the German government has revised its 'protection clause' in a manner that no longer prohibits firms from competing for government contracts on the basis of the affiliation of its management or employees with the Church of Scientology. This decision represents significant progress in addressing U.S. concerns relating to the use of 'sect filters.' The Administration will continue to monitor the implementation of the revised policy to ensure that U.S. firms and workers are not discriminated against in procurement by German Federal and sub-Federal governments." Message-ID: 9doqfm$

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