This KR contains names and accusations against former and/or current members of CoS. It is presented here in the original version as sent to me by an anonymous source so that the named individuals are made aware of the accusations made against them inside CoS. I can in no way vouch for the autenticity of the document or the accusations within it. This is released to hopefully establish the truth and to serve as an example of the use of KR's in CoS and hopefully start a debate on the subject. The document is transcribed manually and could contain errors. [START] 12 JAN 90 ETHICS CLO WUS FROM: D/LEGAL RUDS CHIEF OSA US CC: LEGAL RUDS CHF OSA INT CC: A/LEGAL AIDE OSA US CC: CHF OFF OSA US CC: CO OSA US CC: A/PGMS AIDE OSA US CC: WUS PGMS CHF OSA US CC: CO CLO WUS CC: CO FOLO WUS CC: CONT FINANCE DIR WUS CC: PAC FINANCE DIR WUS CC: A/TREAS AIDE CLO WUS CC: TREAS AIDE FB CC: INT FIN ETHICS OFF CC: FLAG FIN DIR CC: TREASURY INSPECTORS FB FOR PAC CC: D/CHIEF ACCOUNTANT INT CC: CO LA DAY CC: FBO LA DAY CC: CO ODA PAC CC: LEGAL OFF OSA PAC CC: DATA FILES CLO WUS CC: DATA FILES FB CC: DATA FILES OSA US CC: DATA FILES OSA INT CC: REPORTS OFF RTC
KNOWLEDGE REPORT RE: LA ORG TAXES This is a report regarding the follow up on the KR recently written by Cory Erickson, Legal Officer OSA PAC on the LA Org's payroll tax scene. Firstly, the Chief Off, myself, and the WUS Pgms Chief went down to see the Cont Finance Dir WUS. She was handed the KR to read and was told that this criminality was outrageous and that the amounts in the KR were to be added to the Bills stats. The Cont Finance Dir had no CI on doing that at all and she did not know about this cycle. She called LA Org and had the FBO come over to her office. While we were waiting for the FBO to come over, I "R" factored the Cont Finance Dir that OSA US was basically being totally [new page] -2-
unreasonable with these gross Financial Irregs and are handling with ethics to get these types of sites off our lines. Cont Finance Dir did not hesitate to state that the EC was defenitely now being Comm Eved and within a couple of hours, they had the Comm Ev CSW on the FBO enrouted to IJC. When the FBO arrived, she looked over the report and basically tried to white wash the cycle, saying she couldn't possible see how October wasn't paid since it was all done by computer and the computer would have automatically spit out the payroll check and the check to the Government for withholding taxes. We then called Legal Off OSA PAC into the office, since this did not make sense. She said that there was money spent on other things but didn't have specifics. So I basically said, we need to go down to Treasury LA Org and find out really what was going on. So the FBO, myself, Chf Off, and WUS Pgms Chf went to LA Org Treasury. We found that the Treasury Inspectors from FB were down in there investigating this same cycle. I found after about half an hour that they were getting absolutely no where. The FBO was confusing the issue. The cycle started with trying to find out where the missing money was for October, but all the records showed was that funds spent out of the Account were pretty much accounted for. At that point, I started asking a lot of questions of the Treas Sec regarding the Computer system because this could only mean that the withholding taxes were never deposited in the first place plus the account shortage were probably from earlier periods. In pulling strings we found out that there were funds ripped out of the Reserved Payment Account in 88 and 89. The ex Treas Sec, Martin Witt, had a sort of Bank operation going where members of EC requested funds from the account for FP cycles and he considered that money "owed back to him" etc. and of course it was never paid back. It turns out Marlin [sic] Witt did fictional tax filings in 1988 for the org, reporting bullpen figures out of his head. He messed up the payroll records so bad that one couldn't tell at all what people DID get paid. For instance there were weeks when pay got cut, but payroll DVs were paid even though the pay had been cut. Where he would get the money to pay them was from the withholding tax that he kept as cash in the safe and didn't deposit to the IRS like he should have. Also, it was found that this cash withholding tax was used for other things as well. These 1988 filings still require fixing and there are still filings from 88 not done. They never did the annual State tax filing for 88 because they [new page] -3- coyuldn't [sic] answer the questions as to why their W2's didn't match their quartely tax filings and they couldn't correct thier [sic] quarterly tax filings because they didn't do payroll audits. This guy is now holding Course admin. Has had goten [sic] busted out of Treasury but never Comm Ev'd due to staledated justice. He did purchase FPRD auditing regarding the Finance areas and got the auditing in the HGC. Tina Hall comes on as Treas Sec in Dec 88. The records dramatically worsened when Tina went on with regards to Treasury audits. She consistantly filed all the returns late, thus accumulating more penalties and interest. All filings under her had been inaccurate. She wrote a cheque for just over $7,000 made out to her, signed by her as one signatory, and forged another signatory's signature. This cheque was cashed and supposedly used for payroll, per Tina. However, over $1,000 is not accountable in that week's pay as it was $1,000 less than the amount of the cheque. It has not actually been verified as of yet, whether that money did actually go to staff pay. The string are not fully pulled on this, and an audit needs to be done to pull this right down. In the last few months, several blank signed cheques have been found in Treasury all of which had Tina's signatures. 1989 filings are bozo. Never done a payroll audit and cannot match their tax filings figures to their pay records. They have currently, conveniently lost about half of their original payroll records for 1989. We have ordered that an all hands search for these records occurs tomorrow and we are making the EC responsible for finding them. It will be intereting [sic] to find out who is hiding these records and what they don't want found out. Other persons who worked in Treasury during 1989 as follows. Henry Rodriquez. Came into Treasury in Jan 89 as Dir RAM. He left Treasury in August 89 and then took a lower post in bookstocks. Henry was never qualled to be in Treasury, nor for that matter, to be on staff. He has a criminal history of theft. His own business was closed down by the IRS, This was the person put in charge of payroll audits and tax filings for LA Org. He never made one single payroll audit balance and never got the tax filings done in time. He was being routed out a few weeks ago and he blew the org. He is disaffected now and will not answer phone calls. Vicki Nelson was Dir Disbursements in 1989. She screwed up records, lost some of the records and could not properly add [new page] -4-
figures. She also put on the Bills Summary as Bills owing, a piece of promo from a telex directory for EU. This was not a bill at all, but a promo piece. She paid the bill and now has the org listed in the EU telex directory!!!! In 1988 alone, LA Org paid out approximately £40,000 in tax interest and penalties due to late filings. In 1989 they almost lost their right to sell books by having their license lifted due to their late filings and payments. The above is the overview based on stringpulll [sic] back. So the PT shortage in the bank accounts are based mainly on he [sic] above screw ups on amounts being deposited etc. In order to get specifics a payroll audit needs to be done. Before this can occur, the missing 89 records must be found immediately. Further data with regards to the 4th quarter 89 is that, the new Treas Sec, Sean (last name) has not paid any payroll withholding taxes since w/e 23 November 89. He he [sic] didn't know how to make the payments so he just stuffed the cash in the safe along with unpaid Book Commissions. He is totally green and unhatted. The Sales Tax also wasn't paid for the 4th quarter and we are making the FBO figure out the amounts owed and she is fully reponsible [sic] for getting these paid in the morning along with unpaid 4th quarter payroll taxes. I have briefed the Cont Finance Dir and the PAC Finance Dir on the filings etc as above and demanded cooperation at NCC to get ethics immediately applied and the Comm Evs going up lines. The FBO's Comm Ev is already on lines. The other EC members are IP on being put together and to be on lines. I have requested immediate Sec checks of the EC members of NCC. Will also liaise with SC OSA US to get RBs done on EC of the org on being put together and to be on lines. I have a separate report to follow regarding the amounts we have now deduced as owing for the 4th quarter based on the figures arrived at by the Treas Sec and FBO. They will be verified by separate audits to be done by the ATF as needed.
ML, Dan [END] Best wishes,
Andreas Heldal-Lund, Nunsteinvegen 9, N-4056 Tananger, Norway
Pho: +47 90 04 32 99 Fax: 90 32 35 46 E-mail: ahl@xenu.net
home.sol.no/~spirous www.xenu.net www.hedning.no/hedning
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"If anyone can show me, and prove to me, that I am wrong in
thought or deed, I will gladly change. I seek the truth, which
never yet hurt anybody. It is only persistence in self-delusion
and ignorance which does harm." -- Marcus Aurelius
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