NXIVM Cult Leader Arrested: Parallels with Scientology?

By John P. Capitalist

Earlier this week, Keith Raniere, the leader of Nexium (pronounced “Nexium”), a cultic group headquartered in Albany, New York, was arrested in Mexico after fleeing the US and swiftly extradited back to the US for trial. He’s accused of sex trafficking in conjunction with a secret “sorority” made up of Nxivm members who agreed to function as slaves for him, and who were branded in their pelvic region with his initials. There are other investigations pending that may result in further charges.

Though Nxivm never achieved the success of Scientology in its 20-year history, there are some interesting parallels between Nxivm’s modus operandi and Scientology’s as well as some parallels between Keith Raniere and L. Ron Hubbard’s claims about themselves. We look at some of these parallels and try to determine whether there’s any way to use the accelerating collapse of Nxivm to predict the endgame for Scientology, particularly in seeing how activists can target their efforts to hasten its demise.

Keith Raniere. Source: Albany Times-Union

About Nxivm

Nxivm was started in Albany, New York in the late 1990s by Keith Raniere.  He had previously run a multi-level marketing company called “Consumer’s Buyline” (CBL), which was shut down by regulators for various sorts of bad behavior including allegations that it was a pyramid scheme.  Shortly after the 1997 collapse of CBL, Raniere started Executive Success Programs, which later became one of the entities under the broader Nxivm umbrella.

Nxivm has several entities that offer various sorts of training programs.  Those offered under the “Executive Success Programs” label are typical Large Group Awareness Training (LGAT) format classes, with a series of initial courses and progressively more expensive longer courses.  As members complete more courses, they’re allowed to wear sashes with various colors at Nxivm events, which denote their status.   Inner circle members and management are encouraged to move to the Albany area to be closer to leadership. Rich supporters are invited to make large donations to various Nxivm entities and to fund for-profit businesses founded by Raniere, many of which have failed, including a $65 million commodities trading schemeusing money from two rich followers.

Nxivm claims to have enrolled 16,000 people since 1998 in its training classes, which are offered at training centers in Albany, NY, California, British Columbia and Mexico.  This number is probably only about 5% of the number of people who actively pursued multiple training courses over the 60-year history of Scientology, and is also far less than the number of students of long-running LGAT enterprises such as Landmark Education.

Nxivm has aggressively recruited celebrities of various sorts to its courses, and numbers several moderately successful actors in its ranks.  It has also had significant success in attracting rich donors, most notably two of the heirs of the Bronfman family, the owners of the Seagram liquor empire, who are estimated to have given over $100 million to various Raniere projects.  Nxivm has a sizable presence in Mexico, where members include several family members of Carlos Salinas, a former president of Mexico, as well as scions of other prominent Mexican families.  Former surgeon general Antonia Novello took classes, though is not currently involved. And famed entrepreneur Richard Branson is believed to have participated in some training.

Nxivm also offers other types of “training” through other entities.  “Rainbow Cultural Garden” is an attempt to raise super-kids, by immersing them in a different language each day of the week, from infancy. Children spend most of their time away from their parents, thus making them ripe for cult indoctrination.  Another group, “Jness” claims to be about “empowerment of women,” with multi-day training courses using core Nxivm materials, though it appears to be a recruiting ground for the DOS group as well.  One article suggests that Nxivm created a front group called “The Knife of Aristotle” (occasionally also called “Ethical Media”) to recruit journalists and others into the cult under the guise of a fake-news watchdog site.

Nxivm has been successful at cultivating some relationships with legitimate religious groups, and sufficient political relationships in its home community to potentially slow or deflect investigations from New York state agencies and the local FBI into its actions.  In 2009, Nxivm leaders were able to persuade the Dalai Lama to appear publicly with Nxivm in Albany under the auspices of the Ethical Humanitarian Foundation, a Nxivm front group.  The meetings were apparently brokered by Lama Tenzin Dhonden, the Dalai Lama’s US emissary, who was recently dismissed amid allegations of impropriety in soliciting donations.

Keith Raniere meets Dalai Lama in 2009. Source: Frankreport.com

About Keith Raniere

Keith Raniere, 57, was raised in the outer suburbs of New York City. He received several degrees from Rensselaer Polytechnic Institute, located near Albany.  He was apparently an undistinguished student, according to the federal indictment, maintaining a 2.2 GPA.  However, according to Forbes, Raniere “claims he spoke in full sentences when he was a 1-year-old, taught himself high school math in 19 hours when he was 12 and, by 13, had learned three years of college math and several computer languages.” We note that learning multiple programming languages today is not difficult for a teenager, but it was extremely difficult for a middle-school student to find a computer much less to teach himself to program one in 1970, given the paucity of educational material.

Raniere has claimed to have the highest IQ ever recorded (via a dubious test), claiming various figures up to 240, though any mention of this was scrubbed recently from Nxivm-related web sites.  He also claimed to have been a martial arts champion at a young age and to have held the New York state record for the 100-yard dash as a student.

Like Scientology founder L. Ron Hubbard, Raniere claims to be a polymath; at one point, his web site claimed he was a “scientist, mathematician, philosopher, entrepreneur, educator, inventor and author.”  His career as an inventor has been clouded, to say the least.  Recently, he sued Microsoft and AT&T for patent infringement, claiming that he had invented video conferencing.  The suits not only were unsuccessful, but were so poorly founded and Raniere’s behavior was so egregious that the defendants were awarded over $1 million in attorney’s fees.

Raniere insists that followers call him “Vanguard,” much as Hubbard wanted his minions to call him “Source.”  This sort of naming may seem odd but serves a very important purpose in cult indoctrination: causing believers to see the founder as more-than-human and infallible.  By creating a medieval “authority” style of thinking, believers are less likely to evaluate specific doctrinal beliefs and realize how bizarre they are.  And like Hubbard, Raniere has turned his birthday into a major event on the Nxivm calendar. Members celebrate “Vanguard Week” every August, a ten-day event at a remote upstate New York resort where members can meet with Raniere, as well as to take courses and be sold on signing up for more.

Trouble in Leatherstocking Country: Mounting Woes, Fleeing Leaders, Federal Indictment

Photo Montage of Raniere’s Initials Branded on DOS Members. Source: Frankreport.com

In October, 2017, the New York Times broke an article detailing with Albany-area Nxivm watchers had long alleged: Raniere ran a secret sub-group called DOS (“Dominus Obsequious Sororium”, Latin for “master over the slave women”), which signed up Nxivm members as submissives in a master/slave society, where they did all sorts of tasks for their masters, and were required to have sex only with Keith Raniere.  As part of the initiation, they were branded with Raniere’s initials in their pubic region, and some former Nxivm members allege that this was done without fully informed consent.  The logo used also reflects the initials of former actress Allison Mack, who allegedly ran the DOS group.  As a condition of joining the DOS group, people were required to deposit “collateral” to dissuade them from leaving, including nude photos, and information about financial transactions and their past behavior that would embarrass them and family members if revealed.  The NYT article spawned a number of other feature pieces, including one in Rolling Stone that detailed sexual abuse of female members, and abuse including insisting that Raniere’s lovers follow extremely restrictive low-calorie diets, leading many to become emaciated.

Shortly after the NYT article appeared, Raniere fled to Mexico, where he was spotted on several occasions walking through a secure gated community in a suburb of Monterrey, the industrial hub of the country.  Many of his rich Mexican donors lived nearby.  As rumors continued to swirl about an FBI investigation (including in a December 2017 New York Times story), Raniere disappeared again until his capture on March 26.

Rumors on The Frank Report, a critic web site run by a former PR manager for Nxivm, alleged that there are multiple investigations under way, including the one that resulted in the indictment as well as other investigations around financial dealings.  Importantly, the investigations were handled by Manhattan-based FBI and US Attorney’s offices, as local critics had frequently alleged that Nxivm had managed to “safepoint” officials in the Albany area, suppressing investigations despite numerous complaints from former members.

Raniere was arrested on March 26 near Puerto Vallarta, where he was staying in an expensive rented villa with several female followers.  He was immediately extradited to Texas, where a bail hearing was held the following day.  The government has characterized Raniere as a flight risk, given his access to private aircraft supplied by his wealthy followers and by his behavior since learning of the investigation in late 2017.  Below are the indictment and the government’s memo detailing the reasons they’re seeking to hold him without bail.  A video has surfaced of the women at Raniere’s final stronghold deciding to jump in a carand chase the heavily armed Federales who are hauling Raniere off to a Mexican jail to be processed before his return to the US; the ensuing high-speed chase unsurprisingly failed to free Raniere, but fortunately didn’t result in any fatalities among the pursuers.

Amusingly, Raniere put out a statement on the Nxivm web site shortly after his arrest, reassuring members that he has hired experts to investigate the group thoroughly. He said, “over the past months, there have been extensive independent investigations performed, by highly qualified individuals, and they have firmly concluded that there is no merit to the allegations that we are abusing, coercing or harming individuals.” Raniere also said that he had no association with the DOS master/slave group, despite the government’s sworn affidavit citing multiple e-mails from him directing its creation and operation.  The idea that the general public would accept the word of cult-paid experts that there was no bad behavior and that Raniere had nothing to do with any of the non-existent bad behavior is just… adorable.

On March 27, the FBI raided the home of Nancy Salzman, Rainiere’s second-in-command (Salzman’s code name in the group is “Prefect”).  Critic sites suggest that this may be related to money laundering as well as the DOS branding scandal.

Press coverage continues to grow, with the major broadcast news networks running stories, as well as local, national and international media running stories.  Yesterday, People magazine ran a story featuring actress Catherine Oxenberg, whose daughter India is in the group. The People story is likely to attract a large audience far beyond regular news watchers, and further choke off the recruiting pipeline.

Parallels Between Nxivm and Scientology and Their Founders

There are numerous parallels between Scientology and Nxivm; I could cite dozens of similarities between the groups that have struck me in the two years since I discovered Nxivm.  Here are some of the most interesting and relevant ones.

  • Litigation: Raniere uses the same scorched-earth litigation tacticsagainst opponents that Scientology does.  One critic web site suggests that Raniere may have spent $50 million in legal feesover the last 20 years with little to show for it.  Raniere spent 14 years suing well-known anti-cult activist Rick Ross in a case that recently collapsed. Raniere has also sued journalists exposing him.  High-level member/donor Clare Bronfman attempted to have Sarah Edmondson, an actress and prominent defector, arrested in Canada.
  • Fabricated background: Raniere’s background is as fabricated as Hubbard’s, given the wild claims above. This is fairly common for cult leaders, as part of establishing themselves as an object of their followers’ veneration. Like most of Hubbard’s exaggerated claims (youngest-ever Eagle Scout, daredevil pilot, “blood brother” to the Blackfeet Native American tribe at age 4), Raniere’s claims are ludicrous on their face and easily contradicted.
  • Secrecy of the “Tech:” Nxivm materials have been subject to extraordinary secrecy, just like Scientology’s, before Scientology’s teachings became widely available over the internet in the 1990s alt.religion.scientology era. One of the claimed grounds of the Rick Ross suit was his publication of Nxivm internal materials.  Nxivm students sign extensive non-disclosure agreements, and members of the inner circle give leadership “collateral” that is explicitly intended to be used to keep them from leaving.
  • Obsession with “Ethics:”  Raniere follows the same playbook as Scientology and many other cults, claiming to be “the most ethical people on the planet.” This is a common cult technique for engendering feelings of superiority among members, and for redefining members’ sense of morality to enable leaders to get members to engage in highly amoral activities, following the leader’s dictates over their own consciences.
  • Expansion from Core Self-Help Into Other Areas: The creation of child-rearing programs such as “Rainbow Cultural Garden” (especially given its locations in places such as London, well away from existing Nxivm offices) smack of Scientology’s expansion into “study tech” and drug rehab.  The principles behind Nxivm’s language immersion approach are just as scientifically ludicrous as those behind Scientology’s idiotic attempts to treat reading problems.
  • Blatant disregard for basic human rights:  Nxivm was accused of conducting experiments on brain activity on several memberswithout consent, and without any sort of scientific basis, just as Scientology has engaged in all sorts of quack research on the “tech” of self-help.  These experiments may have been designed to figure out what sort of stimuli would make members more likely to sign up for additional courses.

So What Does Nxivm’s Endgame Mean for Scientology?

We would argue for caution in using the parallels between Nxivm and Scientology to conclude that Scientology is on the verge of collapse.  Instead, we have consistently argued for cold-eyed rational assessment of the situation, rather than being tempted to mistake what we want to happen for what is likely to happen.

We continue to believe that Scientology is past the point of no return, and its collapse is now inevitable.  However, we think that the far greater size and organizational complexity of Scientology relative to Nxivm is sufficient to render Nxivm as a predictor of the timing of Scientology’s demise difficult.  Remember that the Roman Empire’s doom was sealed hundreds of years before the sack of Rome in 476 A.D.  Many large organizations continue to exist in “zombie mode” long after they’ve lost all vitality and relevance.  The American steel industry is a good example. In cults, the Muggletonians were quickly relegated to irrelevanceshortly after their founding in 1651, but the last Muggletonian died over 300 years later.

Raniere’s empire seems to be unwinding quickly. The collapse seems to have started in early 2017 as allegations began to circulate more broadly about cult-like behavior and rumors of the DOS group began to circulate among the broader Nxivm membership.  Several defections of longtime members including two of the actresses affiliated with the group may have exacerbated the trend. According to the leading critic website, the August 2017 “Vanguard Week” birthday celebration at the Lake George, New York resort, may have had only about 100-125 people, down from the 400 or so that attended in previous years.  Importantly, since Nxivm didn’t operate its own residences for staff or members to keep them away from bad press, members were far more able to view critical information than in many larger cults such as Scientology, who isolate staff and some members very effectively.

I’d argue that a cult this small, with only a few hundred deeply committed followers, and with a relatively small internal bureaucracy, will unwind much faster than a cult with an extensive bureaucracy of thousands of staff members keeping close tabs on members and coercing them to remain. While Nxivm clearly has highly coercive retention mechanisms (their “collateral” trumps even the invasive details held in Scientology’s “pre-clear” auditing history folders), in the current climate of active investigations, it’s unlikely that Nxivm would be able to actually release the “collateral” information to intimidate members to stay without serious repercussions, essentially validating all the allegations of cult-like behavior and further accelerating the organization’s demise.

In Nxivm’s case, the fact that Raniere was still at the helm of the organization and interacting frequently with the most committed members, means that without him, the organization is probably doomed.  Second-in-command Nancy Salzman, who may be in failing health, was never presented as a leader-in-waiting, but always as a helpmeet to Raniere.  She is unlikely to be able to assume Raniere’s mantle if he’s convicted and imprisoned, especially if significant amounts of additional charges are laid against Raniere.

In Scientology’s case, while there is no deep bench of management talent to take over from David Miscavige, few members have any relationship with top management, so the odds are good that anyone who won the battle to succeed Miscavige would be accepted by members, since there are no factions of membership loyal to rival executives.  That’s not true in Nxivm’s case.

While it’s entirely possible that Scientology could collapse quickly, much as the Soviet Union collapsed quickly in 1989, it’s likely that Scientology will last much longer than Nxivm.  Any veneration of Hubbard, who died over 30 years ago, is restricted to the shrinking number of older members who remember when he was alive. Though Scientology still pays lip service to Hubbard at events, “veneration” of him is likely to be increasingly rote rather than fervent; current members are most likely loyal to the organization and the “tech,” so as long as the organization persists in some form, there will be Scientologists.  And current leader David Miscavige has relatively little day-to-day contact with most of the membership base, so his absence would similarly not spell the death knell for Scientology.

We continue to argue that Scientology will indeed end after a long period of decline, though we continue to believe that the rate of decline will actually slow over the next few years as only the most committed  members remain. While the rate of “organic” decline slows, the organization becomes more vulnerable to what we in Global Capitalism HQ call “exogenous shocks,” unpredictable events from outside that will significantly damage the cult. These are, unfortunately, impossible to predict, by definition.

Short-term actions that can make a difference include trying to shut off the R-1 religious worker visa use by the cult, where it gets the bodies needed to staff much of Flag, since it can’t recruit enough domestic staff.  Keeping up the illusion of success at Flag is critical to keeping wealthy donors on board, and the cult needs minimum numbers of employees to be able to operate the hotel and restaurant facilities.

We also believe that complaints to European privacy regulators for Scientology’s violations of the new GDPR data privacy regulations will hamstring its operations in Europe.  Scientology simply cannot comply with these regulations as its obsessive spying on and documentation of the most intimate details of members’ lives is baked into the cult’s DNA via Hubbard’s holy writ.  In our view, European regulators are deadly serious about enforcing GDPR, not only with a few test cases, but with a long string of investigations about complaints.

Also, exposing specific financial irregularities to regulators may yield results.  We think that there are numerous specific acts that would be of interest to various regulators and law enforcement if appropriate documents emerge.  In our view, narrowly targeted efforts are more likely to bear fruit than a massive all-or-nothing effort to repeal the tax exemption.  We have argued that losing the tax exemption would hurt members, as they may be on the hook for taxes on past “donations,” but the cult would still be able to operate given the size of the reserves.

This is not to say that there is little hope that Scientology could collapse quickly.  We have said on multiple occasions previously that Scientology could collapse quickly, much as the Soviet Union did, but that it is likely impossible to predict in advance precisely what will trigger the collapse.  Thus, keeping up well-chosen and focused efforts to hobble critical parts of the operation could pay dividends, especially when in conjunction with broad press coverage of the damage the organization does to members, former members and innocents.

John P. is a Wall Street money manager and IT technologist fascinated by irrationality in all its forms, and Scientology most of all. He’s a lifelong Steely Dan fan. 





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