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Executive Summary
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2. Objectives.. 2 3. Purpose. 3 4. Background.. 3
5. Analysis of leaked documents.. 5 5.1. Internal analysis of Elan Vital Australia, non-profit association and owner of IRCC P/L. 5 5.2. Indicative cash flow positions for 2001. 6 5.3. Amaroo Loan Repayment Schedule 2002. 6 5.4. Staffing - Amaroo September 2002. 7 6. SUMMARY AND Recommendation.. 7 Ivory's Rock Conference Centre Pty Ltd is suspected of serious financial fraud. The non-profit association, Elan Vital Incorporated (ffice:smarttags" />Australia) is being used as a profit making private enterprise and luxury private residence for a US citizen. 1. Myrine Investments owns the land and buildings. Myrine Investments is registered in Jersey, Channel Islands, an off shore tax haven. There have been an estimated $30,000,000 USD spent on improvement to this property since it's purchase in 1991 by volunteer and paid labour, loans, donations and revenue, organised by Ivory's Rock Conference Centre Pty Ltd. The commercial value of the property is estimated to be $7,000,000 Australian, as the improvements are eccentric. 2. Prem Pal Singh Rawat has publicly stated that he owns this property. 3. Elan Vital Incorporated (Australia), a non-profit association registered in tate>South Australiatate> has a lease to the Ivory's Rock Conference Centre site from Myrine Investments - important point to note Prem Pal Singh Rawat has the right to nominate the members (effectively the directors) of EV Inc. 4. EV Inc. owns a company called Jeeps Nominees Pty Ltd. - note that Ltd (Limited) refers to legally limited liability, this means if Jeeps Nominees Pty Ltd were to go bankrupt little or no liability would fall on EV Inc. Jeeps Nominees Pty Ltd owns Ivory's Rock Conference Centre Pty Ltd 5. Leaked financial documents from 2000/2001 indicate neither Jeeps Nominees Pty Ltd nor IRCC Pty Ltd appear to have any significant level of assets, and that IRCC Pty Ltd is unequivocally a trading company yet it appears to have been trading while insolvent, since 2001 - a serious offence under most commercial law. 6. Since a business is viable so long as its assets are equal to or greater than its debts, according to leaked documents, Ivory's Rock Conference Centre Pty Ltd had apparent debts of $11 million(US) in 2002. Even if Myrine's assets were behind IRCC Pty Ltd, of which there is no evidence, the conference centre appears to be broke. 7. The leaked documents indicate it is financed by an ongoing effort to co-erce new loans from followers of Prem Pal Singh Rawat as the old loans become due. 8. Recent confidential anecdotal evidence reveals that selected lenders have been quietly advised to recall their loans as quickly as possible from IRCC Pty Ltd, for reasons unknown. The main objective of this assessment is to expose the financial affairs of Ivory's Rock Conference Centre Pty Ltd (owned by Elan Vital Australia) to appropriate scrutiny by the proper authorities in the light of anecdotal evidence and leaked internal documents. The inference is that this company is sailing close to the wind in terms of financial propriety. (It appears that the company may have been trading while insolvent, and apparently breaks the criteria for a non-profit association, that of providing no benefit to an individual.). A second objective is to examine the relationship of Prem Pal Singh Rawat of Malibu, California to IRCC Pty Ltd. Significant anecdotal and circumstantial evidence indicate that he is the main source of commands and directives for Ivory's Rock Conference Centre Pty Ltd. (See attachment: letter from the co-CEOs of IRCC P/L, 16th October 2001). In addition, there is strong anecdotal evidence that Rawat is the beneficial owner of the Ivory's Rock Conference Centre land and improvements through the Jersey company Myrine Investments. This begs the question of the tax-free status of Elan Vital Australia as a non-profit association. In addition recent confidential anecdotal evidence reveals that selected lenders have been quietly advised to recall their loans as quickly as possible from IRCC Pty Ltd, for reasons unknown. The purpose of this document is an initial consultation to notify appropriate authorities of possible illegalities under Australian company law, and to question the tax-free status of non-profit association Elan Vital Australia, apparently invalid by virtue of land and property improvements estimated in the vicinity of $30,000.000 USD to the alleged beneficial owner, Prem Rawat of Malibu tate>Californiatate>. The land and improvements of Ivory's Rock Conference Centre (also known as Amaroo) is owned by a company based in Jersey UK ( Myrine Investments). This company leases the land to Elan Vital Australia for 99 years. Elan Vital owns the company Ivory's Rock Conference Centre Pty Ltd through Jeeps Nominees, and has given the company the rights to run and develop the property. Elan Vital internationally has raised tens of millions of dollars in loans from its members to develop the land and infrastructure via Ivory's Rock Conference Centre Pty Ltd. Conferences involving discourses by the cult leader Prem Pal Singh Rawat appear to be almost the only activity, and these seem to be held annually. They involve · Motivational speeches by the cult leader. · Recording of motivational speeches by the cult leader · Sale of artefacts relating to these speeches By extrapolation of the leaked financial documents, improvements to the property are estimated to have cost conservatively $30,000,000 USD. (From the documents capital works in one year were $4,000,000USD. The property has been developed from pasture land over 10 years, and 2001 is taken as an average year. The improvements include kilometres of fibre optic cable, computer networks, water and sewerage systems, roads and bridges, two luxury mansions, a fine dining restaurant, a meeting hall, an outdoor theatre, several bathroom blocks, permanent shopping stall complex). Elan Vital has a tax exempt status as a non-profit association incorporated under the jurisdiction of the South Australian Attorney-General. The conference centre caters almost exclusively to followers of Prem Rawat, known as premies, a Hindi word for lover. Some of the conference facilities are: - A palatial accommodation area known as Windmill, for the exclusive use of Rawat.
- Further luxury accommodation areas for Rawat's family
- There is a fine dining restaurant given to Rawat's daughter, Daya Rawat. This restaurant operates for a week or two a couple of times a year, and charges in excess of $200 per head for a meal.
- There is a sumptuous stage and dressing area for Rawat's use in an otherwise open air theatre.
- There is a hall where he or his followers hold meetings for inner circle people.
- For the conference participants there is outdoor seating at the theatre, and a camping ground with bathrooms but no kitchen facilities.
- During religious events, they are catered to by permanent food stalls leased out at conference time to local vendors.
The facilities are not suited to normal commercial use. In fact what has been built at Ivory's Rock Conference Centre is a luxury accommodation areas housing only a few people, an outdoor amphitheatre suitable for theatrical events, a small meeting hall for a few people, and for ordinary attendees, a camp area with toilet blocks and showers. The capital works have been estimated to in excess of $30,000,000 USD, but the commercial value of the property at around $7,000,000 Australian. Rawat is the defacto boss of treet>IRCC PL.treet> One of the leaked documents bears this out, as two co-CEOs of Ivory's Rock Conference Centre, George Laver and Cath Carroll deliver a progress report on the IRCC to him. The conference centre is used as a private residence for Rawat when he is in Australia. The leaked documents show, supported by a wealth of anecdotal evidence from the ex-members of the cult involved in the running, that the company IRCC Pty Ltd only continues to operate by borrowing increasingly large sums from followers, in part to meet new costs, in part to pay out old loans. From the leaked documents, the outstanding loan balance is appears to be in excess of $10,000,000 USD. Most of the new expenses are capital improvements. Anecdotal evidence indicates that there is no will from Rawat, who is known to cult members as ‘the boss' to change this circumstance. In the last couple of years, IRCC Pty Ltd has suffered substantial declines in business levels, since the period covered by the leaked financial documents for 2001/2002, and conferences with Rawat have been cancelled. A source close to Rawat has privately revealed that some of the inner circle followers who are major lenders to IRCC P/L were advised over the Christmas New Year period 2003, to withdraw their loans from the company. The attorney-general of Jersey may be approached by an appropriate authority, to divulge the ownership of Myrine Investments. Myrine Investments has gained an estimated $30,000,000 USD worth of improvements to the land and infrastructure through IRCC P/L, and should IRCC P/L go bankrupt, Myrine has nothing to lose and everything to gain. The lease with Elan Vital would be invalid, and the improved property reverts to it's owner, who has paid no money for the $30,000,000 improvements. Rawat is widely believed to be, and has publicly stated he is the owner. Rawat has publicly distanced himself from the various Elan Vital associations around the world, however his commercial role in relationship to the Ivory's Rock Conference Centre Pty Ltd is that of shadow director. Financial and other documents were downloaded from the internet. They were leaked by the spouse of a follower, because of concern for the spouse's involvement in illegal activity. All the documents are of significant interest. The internal analysis document contains the following quotes: - "EV's (Elan Vital's) management believed (and articulated) they had no mandate to report the business of EV to the communities, and they have never done so, regardless of the fact that EV's existence and functionality is dependent upon the support and trust of the communities"
- "increasing levels of debt, dwindling financial support, morale (and their effects on propagation) concern both EV and the communites"
- "Everything about EV as a corporation is virtually unknown and equally apparent that it has been carefully kept so"
- "There are no associate members on the board to represent communities"
- "Because it is a not-for-profit organisation, EV cannot enter into profit making activities such as charging admission fees to events. However, a glance at the Amaroo registration package ‘Booking and Entry Conditions' shows how close to the legal horizon EV (UK) sails, stating bluntly that ‘registration is US $410'"
- "through countless ‘inspirational meetings', sponsorship programs and other devices, EV becomes proactive about reaching down into peoples hip pockets, people begin to feel (and rightly so) that they are being coerced, or manipulated, if not starkly fleeced"
This document paints a picture of a hierachical organisation with with vested power, characterised by secretiveness and lack of accountability, with no line of responsibility to the community, yet the community provides the funds to run Elan Vital Australia. This is a very damning picture painted by internal critics of a non-profit association formed supposedly for the benefit of its members, but actually with a membership restricted to a very few, with ordinary followers denied membership, but providing the finance for the organisation by donated contributions and loans. It appears that in 2001, Ivory's Rock Conference Centre Pty Ltd ran at a loss of around $1,000,000 USD. It appears that outstanding commercial loans of around $10,000,000 USD were augmented every month by new financing loans to support this position., even as some were repaid. This position would be untenable for any normal non-profit association. Anecdotal evidence indicates this position has worsened in the past couple of years. It appears likely that in 2002 Ivory's Rock Conference Centre Pty Ltd traded while insolvent. In addition, one document indicates that lenders are often contacted to turn a loan into a donation. The loan replacement schedule indicates that a substantial effort is put in to keep track of the individual lenders in terms of asking them either to extend the loan period, or donate the loan, or find new individual lenders when there is no alternative but to repay a loan. Having to deal with a large number of lenders to support a history of losses appears to be a dubious behaviour for an Australian non-profit association. Particularly in view of the fact that a large proportion of finance seems to disappear into improvements and new infrastructure for the property itself, which is only leased from the owner, the Jersey company Myrine Investments. This document appears to be about a conference with the focus on Prem Rawat and his motivational speeches. Staffing levels seem disproportionate, at odds with normal commercial practice - Executive ( personal staff for Prem Rawat) 76
- Restaurant (fine dining restaurant open for a week catering to a total of less than a thousand diners) 153
- Security ( managing people security) 143
- Ushers for the speeches of Prem Rawat 153
- Human resources staffing 4
Anecdotal evidence indicates that the bulk of these people were volunteer labour, from many countries, spending up to three or four months in tate>Queenslandtate> in preparation for a three day convention. In fact, anecdotal evidence indicates that thousands of international volunteers worked full-time and part-time at the Ivory's Rock Conference Centre over the past 10 years, mainly on capital improvements and infrastructure. It is very doubtful if more than a handful knew that they were working for the Ivory's Rock Conference Centre Pty Ltd. They were almost all under the impression they were working for Prem Rawat. A major part of the business seems to have a business purpose of attracting financial contributions and new loans. Only a small proportion of these monies goes into running a conference centre. The major part goes into capital works and infrastructure to the benefit of an offshore company. It is difficult to understand why IRCC Pty Ltd would spend most of it's time and the substantial proportion of its monies on a large program of capital works that only benefit the owner of the property, the offshore Myrine Investments, and fulfil the obligations of a non-profit association to it's membership. There appears to be some kind of commercial fraud in the activites of IRCC Pty Ltd in constantly soliciting loans to become solvent and replace old loans, with no hope in view of ever being in the black. Surely there is sufficient indication in the leaked documents and the wealth of anecdotal information available about this cult to warrant an investigation of - The non-profit association status of Elan Vital Australia, owner of Ivory's Rock Conference Centre Pty Ltd
- The tax affairs of both the association and it's company
- Why a US citizen appears to have a tax-free capital gains on his palatial residence in Australia paid for by an Australian non-profit association.
In addition, a request to the Attorney-General of Jersey should be made forthwith to disclose the ownership of Myrine Investments, the owner of the Ivory's Rock Conference Centre property.
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