IRS again infiltrated by Scientology cult

[October 12, 1998]

In yet another bizarre twist in the Scientology-IRS war, it has just been revealed that Scientology's tax exempt status and billion dollars in tax forgiveness was aided by the efforts of an IRS official secretly working for the cult.

This information was revealed to FACTNet by Scientology defector Jesse Prince in interviews concerning Scientology's criminal activities and near unlimited spending on covert operations. Jesse Prince was second in command of all of Scientology under David Miscavige, the cult's current leader. Jesse disclosed that while a Scientology executive, he overheard conversations between David Miscavige and other top level Scientology executives regarding Scientology's efforts to obtain tax-exempt status in the US. The conversations of Scientology's leaders revealed that Scientology had recruited an IRS official to secretly assist Scientology in obtaining the long-sought-after religious tax-exempt status. The conversations also uncovered that the employee was retained through one of Scientology's law firms. The law firm had contacted a former IRS executive, who used his contacts at the IRS to recruit Scientology's new IRS insider.

Meanwhile, several months ago, FACTNet received a call from a Washington ally warning that FACTNet and its directors would likely be audited. The ally said a source at a federal government office had informed the ally that the IRS was planning retaliatory audits of FACTNet and its directors, because FACTNet had criticized the IRS's handling of Scientology. FACTNet has written a number of articles on the IRS's secret tax deal with Scientology, which in 1993 was the ultimate result of Scientology's great efforts to gain tax-exempt status. The secret agreement, just made public last year by the Wall Street Journal, not only reversed the IRS's 30-year stance on Scientology by granting it tax-exempt status but also reportedly forgave almost a billion dollars in taxed owed.

The first of the IRS audits on FACTNet and its directors has already occurred, with FACTNet's audit last month. According to FACTNet's CPA, audits of a small non-profit like FACTNet are most unusual. One is compelled to ask whether Scientology's IRS insider is active again, perhaps trying to protect oneself from detection by attacking the messenger.

The following is one of our earlier editorials on Scientology and the IRS, "Did the cult Scientology bludgeon the IRS into a billion dollar tax revenue give-away?" This early editorial does not include this newest information that Scientology had an IRS insider working for it, but does provide a comprehensive background on the IRS and Scientology. See http://www.factnet.org/headlines/give-away.htm.

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