Why Orgs never make a profit

Discussion in 'Think Tank' started by RolandRB, Jun 21, 2010.

  1. RolandRB Member

    Why Orgs never make a profit

    This thread has been started for a discussion about the financial working of Orgs and in particular the hard-to-comprehend topic "Why Orgs never make a profit".
  2. Re: Why Orgs never make a profit

    If orgs did not make a profit, why do Scientology have so much money?

    Some of them must make, or have made, loads of cash.
  3. Gottabrain Member

    Re: Why Orgs never make a profit

    Ok Roland, as I was saying...
    The "Building Fund Account" is part of Scientology policy. But it is also a reasonable account to have anyway since the C of S was required by the IRS in the 80s to spend a certain amount of money on buildings within a certain time limit.

    Each organization had a Reserve account of its own besides the International Reserve account, until the 80s when Int Mgmt wiped it out and transferred the bulk of this overseas. Those are the transfers I witnessed - Cayman Islands and Switzerland.

    It is possible the individual orgs have been building up local monetary reserves since then, but I highly doubt it as they are living very tightly and have been for many years.
  4. RolandRB Member

    Re: Why Orgs never make a profit

    Well exactly! Hence this thread. We will get to the bottom of this mystery.

    In the UK the larger Orgs get business rates relief (not St.Hill, however) because they can prove to the local billing authority that they are "not making a profit" even though they charge a fortune for courses and especially "auditing". They are run by COSRECI and in the unaudited accounts they submit it shows they do not make an overall profit.

    In the larger Orgs that have an HGC they are charging in excess of £27,000 to audit a person to Clear and yet somehow they do not make a profit and COSRECI can provide proof of this to the local authority.

    We need to get to the bottom of this.
  5. Anonymous Member

    Re: Why Orgs never make a profit

    i doubt it
  6. Re: Why Orgs never make a profit

    From what i've gathered is the INT people take the cream and leave the bare necessities to local orgs and even less forcing them to fund drive on top of all the scientologists that have spent money on courses, completely draining them dry.
  7. Anonymous Member

    Re: Why Orgs never make a profit

    This is relevant - Operation Clambake Message Board :: View topic - ANOTHER BEDTIME STORY

    And of course from the other thread that spawned this discussion -

  8. RolandRB Member

    Re: Why Orgs never make a profit

    Can we go back to basics on this? I will explain.

    If an Org is making a pile of money on auditing people to Clear at £27,000 a time (this cost might be much higher - I am lacking the dox) and raking in maybe £20,000 a week then how is it the accounts show they are making a loss? I suspect it is because they OWE money to senior Orgs. I have heard that the execs get trained at Flag at huge expense and the Orgs owe for that. And I have heard that Sea Org missions get sent in at huge expense to correct the situation when income drops and that the Org will owe for this but I have very limited experience of seeing this go on at London Foundation and would like clarification of the reason that outgoings balance income.
  9. Anonymous Member

    Re: Why Orgs never make a profit

    What is the supposed purpose of transferring the majority of income uplines - Is it dressed up as 'licensing fees', repayment of 'debts' or something else? And once the money gets to the top of the pyramid, what happens to it?
  10. Re: Why Orgs never make a profit

    Stashed away. That is whatever is not spent on DM's toys. Or his latest house/boat/office renovation. Or feeding his paranoia with 50 private investigators tailing anyone who says a bad word. You know essentials...
  11. RightOn Member

    Re: Why Orgs never make a profit

    There is tons of money going uplines from their front groups too. I can't imagine the cash their consulting groups bring in (we need a lot more focus on bringing them down, especially WISE)

    The money prolly goes towards tiny shoe lifts,designer shirts, motorcycles, PI's, toupes, scuba diving in the caribbean, and moar. LOL
  12. RolandRB Member

    Re: Why Orgs never make a profit

    The controlling Church has somehow got to get money out of the various countries and make sure they pay no tax on it so it all gets to them. They might do this using false accounting. Alternatively, they might do it by making sure the Orgs in any country always owe them more than they can earn.
  13. Gottabrain Member

    Re: Why Orgs never make a profit

    That's exactly how it works. The orgs are required to send staff for higher training to Flag. They also get regular "services" and "missions" from various management entitites which are severely billed. I am sure they have modified this to include various licensing bills and fees and charge similar to franchises in some regards.

    The USGO "mission" bill to the Riverside, Calif area when it was having legal battles was in excess of $500,000, but the actual costs were closer to $80,000.
  14. Anonymous Member

    Re: Why Orgs never make a profit

    The money is being used to produce specially crafted orange boxes more than anything else. Also skin products just for his sensitive feet. Most important of all is the trampling. Paying off Shelly is just some more speculation, if she must still be alive so that she help find the treasure chest with all the gold in it.
  15. Gottabrain Member

    Re: Why Orgs never make a profit

    The thing is... those who really REALLY know (i.e., top executives who have left) are not saying and if they are not the ones who suicided, disappeared or went crazy, they aren't doing badly financially. Interesting. I don't quite know what to make of that...

    I won't name names. But there are a LOT of names of those who REALLY know who are fully out but not really helping us with information.

    But the money sort of... disappears. It doesn't come back. Money to Int never comes back, really... just building investments.

    If we could actually get a full audit done by SOME government of their accounts - and if they are foolish enough to bring in the C of S International, then there would be an excuse to look at the International accounts and find where they all lead.
  16. Anonymous Member

    Re: Why Orgs never make a profit

    Any good accountant / CPA can give you the profit or loss you want in your balance sheet.

    Especially international intracompany transfers are used to get the profit there where you have a tax friendly or even tax exempt status. This is a profession on its own.
  17. RolandRB Member

    Re: Why Orgs never make a profit

    This is what I suspected and this is what I was hearing when I was at London Foundation. I also heard that at one point the Org was doing well (perhaps because of muggins here) and that they had paid off their debts. Next thing I knew a Sea Org mission arrived and they were literally pushing people around. No doubt that put London Foundation in debt again.

    I have written to all the local authorities where they have granted business rates exemption and explained my reasons why they should not get it. I might be asked for more evidence about the way this debt scheme works such that the Orgs always owe higher Orgs money but I don't have that evidence. Any ideas?
  18. RightOn Member

  19. Gottabrain Member

    Re: Why Orgs never make a profit

    It requires an audit, Roland. This info won't be found anywhere publicly. Crooked accountants who are crooked because they are religious zealots or paid handsomely backed by zealot bookkeepers are never going to make this sort of info available publicly. And the financial info is well guarded.

    The FBO accounts would be the best place to start. But I promise you, there are so many records within the churches of the income that they would not be able to hide it all without completely destroying their entire public records. And there is no way they can justify the billings. Most tax departments find this sort of interbilling between related companies to hide a profit to be a financial irregularity at best, and highly illegal in some cases.
  20. Gottabrain Member

    Re: Why Orgs never make a profit

    This is great stuff - and yes, it is true. Buildings are owned by Int management.

    Int management senior signatories are on every church account. That's policy.
  21. Anonymous Member

    Re: Why Orgs never make a profit

    The real reason:
    Black PR by Sci public refusing reg drives

  22. Anonymous Member

    Re: Why Orgs never make a profit

    also Black PR from WISE businesses, who are sucking the money out of Orgs by refusing to pay for services.

  23. LarryBren Member

    Re: Why Orgs never make a profit

    FWIW here is some of a posting I did that gave some background on this:

  24. OTBT Member

    Re: Why Orgs never make a profit

    Roger Gonnet posted this on ars a few years ago:

    How the RTC and senior management ruins an org (financially and otherwise) - alt.religion.scientology

  25. RolandRB Member

    Re: Why Orgs never make a profit

    This thread is looking good. It might be all I have if the local authorities contact me and ask for my justification in claiming the Orgs are making a profit and not a loss (and thus not eligible for a business rates relief), as the submitted accounts of COSRECI try to claim. Please keep the good stuff coming and please keep it on-topic and clean.
  26. the_cloak Member

    Re: Why Orgs never make a profit

    Because DM takes it all.

  27. SOJOA Member

    Re: Why Orgs never make a profit

    I dont understand what is so difficult to understand about it cause your so close to answering your own question.

    Its all the same piggybank. They supposedly rake in saw $20k a week. Their running expenses are say $27k or w/e figures you want to use. So according to the orgs they are losing money everyweek but that does not count the actual donations from parishioners given to the "church" and not the actual orgs. Thats just the running cost for their classes. So say in a given month they have utilites, leasing/renting or mortgaging costs....which Im rather sure a good portion of the buildings they "own" is actually false and its run through a cover company owned by CoS so it dumps into a different account and the Orgs look like they are infact poor and not a profitable business. So they can claim they are a real religion and live on donations and monies that come in from the Sea Org which charges them, again same piggybank, and that money is buried too.

    Anyone can run a business let alone a religion and let themselves appear broke and stay in operation for a long long time because the real dealings are all taking place behind closed doors.

    Also why is anyone asking this? Does anyone really think they are broke? Theres no way in hell they are broke and as much as I detest them they are not that stupid to be broke....yet. The only good that has come since Chanology is people leaving and more exposure which costs them a hell of alot more in hush money, propaganda and media mediation costs.
  28. themadhair Member

    Re: Why Orgs never make a profit

    Because there is fuck all dox to show this.
  29. Anonymous Member

    Re: Why Orgs never make a profit

    The orgs are broke technically and I suspect it is really hard to challenge their accounts, obviously the scilons will baww like crazy in court and have a ton of accountants to smoke screen too.

    As has been explained all the money gets sucked out through a mesh of legal entities and complex accounting and soaks in to the vast money sponge that is Co$, a sponge which itself is quite vast with many separate entities. If anything it's probably far more complex to find out where Co$ money goes than drug cartel money. I doubt that on paper David Miscavige has more than a few thousand to his name.

    Any investigation will very rapidly cross borders and jurisdictions therefore any investigation would have to be international in nature. And at the end of the day which jurisdiction will benefit? Will it be the one where the org is or the ones where the money ends up? How long will it take, how much will it cost and will anyone benefit? These are the kinds of questions authorities likely ask themselves.

    We should keep working the discretionary rates angle. I know from various authorities around the UK that Co$ baww a lot when they want something, that many authorities hold their own against a barrage of legal whining actually says something, very few actually want to give in. Remember these are local authorities with middle management paying jobs, they are not fat cats.

    The more we can throw up the better though so keep at it RolandRB it all counts! One day the authorities may crack and decide we've shown enough to act as one.
  30. Re: Why Orgs never make a profit

    I only know about my org and that was a long time ago. Things may be a little different now.

    It was just an endless struggle to make the rent. Courses and auditing were a LOT cheaper then. The thing was, in our city, people hated Scientology. Just trying to get a new recruit and keeping them was a miracle of sorts. The whole thing should have just been run informally and a little unstandard tech-like òut of a house but you know that would just never have been allowed by the head office. There just has to be an Org or Mission in every city and all that.

    Then there was the usual save 10% of your income and never touch it ( only for an emergency ).

    A percentage to Flag came next.

    And of course there was the GO operating expenses.

    So there you have it. Most people hated Scientology and we couldn't just keep hitting up the same 4or 5 people over and over.

    You will notice that Flag and the GO always got their cut though.

    Funny how that sort of shows again the blind devotion to LRH policy no matter what the situation.
  31. RolandRB Member

    Re: Why Orgs never make a profit

    Exactly. I have written to the local authorities and in the document I attached it claims that the Orgs are in fact highly profitable but that the money is taken out of the country through other Scientology groups. And that they deliberately keep the Orgs in debt and that is why on paper they do not make a profit. But the ONLY document that exists are the COPSRECI accounts that show they do not make a profit. There will be no paper dox to prove otherwise. So I started this thread so people who were once finance officers within the church can give their own testimony.

    Hopefully the contents of this thread will become good enough to convince local authorities that the Orgs ARE in fact for profit and therefore do not qualify for business rates relief. But the content here would have to be very good for the Inland Revenue to start a new court case to force the Orgs to charge VAT on their services.
  32. fisherman Member

    Re: Why Orgs never make a profit

    Pay, wages and stipends in Scientology - Why We Protest Wiki

  33. Anonymous Member

    Re: Why Orgs never make a profit

    Excellent work on the CORESCI UK/Australia exposure. I don't understimate how remarkable and difficult that has been. No surprise either the difficulty in finding Finance people, especially high up, that have been out a short time, to testify or to provide documentation. I could easily suspect why.

    Financial records are serious business in Scientology and guarded with draconian ferocity since day one. I don't even believe that it's about the money. There's enough of it with proper, legal and wise investment strategies to cover all expenses, including living wages and normal operating costs, to perpetuate itself.

    So why wasn't this done and why don't orgs make a profit?

    The answer is pretty simplistic in sheer business terms. You have to sell a product that people want that actually has a value. Scientology sells long term value and is organizationally set up to profit on large scale volume (like Walmart).
    Only it stopped selling at Walmart prices and began selling at Tiffany prices.
    In addition, it seems by statistics that any values were at lower bridge items and very short term (refering here strictly to where Volume sales are pinned).

    When scientology "ethics/justice/fairgame/intelligence operations" entered into the business model, the entire HR (Human Resources, Employee Policy) dramatically shifted.

    Prior, employees were Personally Goal Motivated, with attendant freedom to contribute, share and add to team cooperation and innovation. Afterward, this new model attracted Money Motivated individuals. This model always has a high turnover rate of staff.

    This is where the "normal business" comparison ends. Employees not money motivated who stay loyal to the "company line" in groups like scientology are better evaluated by mental health consultants than business consultants.

    Larry Brennan seems to have astutely laid out the business plan and mission statement in great detail. I might add that while the obstacles of exposure and complexity are true, it is also true that those who make it difficult to see and understand can, in the right circumstances, wage their own red flags.
  34. Shalashar Member

    Re: Why Orgs never make a profit

    Pretty much how I remember it from Plymouth Org back in 2000.

    Handful of folks going over and over.

    A local population fairly hostile toward Scientology.

    Barely making rent and sometimes even having the phone cut off due to non payment.

    Staff wages either at £0 or so close as to make no difference.

    Oh and in Plymouth's case outstanding debts owing to uplines for staff training/materials etc.
  35. Re: Why Orgs never make a profit

    From what i gather is they strip as much cash as possible for courses auditing and then get everyone to donate on the endless "ideal orgs" campaign (because you cant release the higher ot levels until that is done) which also goes overseas basically leaving a whole lot of deluded fools in debt thinking that they have something of value which really is of no tangible benifit. Meanwhile the accountants hide this cash flow.

  36. Re: Why Orgs never make a profit

    Sounds like you are right.

    Funny, take away all the details and it's really all about the money. It was started in the beginning as a scam and that is all there really is to is to it.

    No surprise but I felt I had to insert that there from time to time.
  37. Goosh Goosh Member

    Re: Why Orgs never make a profit

    they get a good portion of their money from celebrities, too
  38. RolandRB Member

    Re: Why Orgs never make a profit

    Actually, I don't think they do. From minor celebrities, perhaps, but not major ones. People like Tom Cruise and John Travolta bring folks in and give the religion legitimacy and so they are doing the Church a huge favour in this way. So they are not expected to make monetary contributions.
  39. Zak McKracken Member

    Re: Why Orgs never make a profit

    Yeah, you'd never expect to see them on a list like this one:


    DIAMOND MERITORIOUS $5,000,000.00
    PLATINUM MERITORIOUS $2,500,000.00
    GOLD MERITORIOUS $1,000,000.00
    SILVER MERITORIOUS $500,000.00

    I see no evidence of celebrity contributions....
  40. RolandRB Member

    Re: Why Orgs never make a profit

    You can also make that list on the estimated number of people you get into Scientology. Some staff members used to make that list and they will only have contributed their time and effort.

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