Prosecution Seeks To Admit Evidence Of Uncharged Criminal Acts – Which, If Approved, Will Almost Certainly Guarantee Convictions

[Editor’s Note: The motion described in this post was filed on March 13, 2019, one day after Nancy Salzman pleaded guilty to one charge of Racketeering Conspiracy – and several weeks before Lauren Salzman and Allison Mack entered into plea deals. Needless to say, things have gotten worse – much worse – for the remaining defendants in this case as a result of those pleas].

The prosecution has sought approval from U.S. District Court Judge Nicholas G. Garaufis to admit evidence of “uncharged criminal acts and other acts committed by the defendants and other conspirators”.

If the prosecution’s motion is approved, it will be allowed to introduce such evidence to prove:
– The existence of the criminal enterprise that is the basis for Count One: Racketeering Conspiracy and Count Two: Racketeering in the second superseding indictment;
– The defendants participated in a pattern of criminal activity; and
– The defendants were members of – and participated in – the criminal enterprise.

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The evidence of “uncharged criminal acts and other acts” that the prosecution plans to introduce includes, but is not limited to, the following:
– The way in which Consumers Buyline, Inc. (CBI) was structured and operated – and the fact that it served as a model for the way that NXIVM was structured and operated. One member even referred to NXIVM as “CBI Part 2” in an email to Nancy Salzman.

– The fact that Keith Raniere was aware of unpaid tax liens and other judgments against him and CBI – and did nothing to resolve them. In addition, he proactively worked to keep assets out of his name in order to avoid paying his past judgments – and to keep himself “judgment proof” going forward.

– NVIVM’s practice of allowing individuals who could not afford to pay for more classes to commit to “exchanges” of their labor in lieu of class fees – but never providing a clear accounting of what these individuals had paid off or how much they still owed. In one instance, a couple accumulated more than $300,000 of debt through such “exchanges” – which eventually forced them to file for bankruptcy.

– NXIVM’s practice of recruiting people to work for the company by offering them lucrative positions – and then informing them, after the fact, that they were not being paid everything they were owed because they had “issues” that needed to be resolved before that would be done. In order to resolve those “issues”, the recruits were encouraged to take EMs (“Explorations of Meaning) – which often cost more than what they were owed.

– The fact that NXIVM members were often told they had committed “ethical breaches” – i.e., some sort of harm that they supposedly caused to the NXIVM community – that they needed to remedy in order to advance in the organization. These supposed “ethical breaches” were arbitrary – and could include things like failing to complete assigned tasks in an appropriate manner, failing to lose weight quickly enough, “playing the victim”, causing negative publicity for NXIVM or Raniere, etc.

– NXIVM’s teachings that women were inferior to men, that men were naturally inclined to have multiple sexual partners while women were meant to be monogamous, and that women who had been sexually assaulted were likely to blame for what happened to them.

– The use of various techniques to illegally bring cash received from foreign students taking classes in other countries into the U.S. Thereafter, NXIVM would record those students as having received “scholarships” in order to avoid having to pay taxes on the fees they paid to the company.

– The use of multiple schemes that were designed to hide NXIVM’s true profitability – and its tax liabilities. In addition, similar schemes were used to disguise the reality that Raniere had access to and controlled all the financial resources of NXIVM and its various affiliates.

– The fact that at least 14 members of the NXIVM community were directed to make the maximum possible financial contribution to the presidential primary campaign of Hillary Clinton in 2007 with the understanding that they would be fully reimbursed for their “contributions” by Clare Bronfman or Nancy Salzman. The overall purpose of this scheme was to gain political influence with the candidate so that “perceived enemies of Raniere” could be targeted in the future.

– The attempt to illegally secure visas and immigration status for dozens of non-citizens so they could work in NXIVM and/or in one or more of its affiliated organizations. Several of these non-citizens obtained visas in order to work as “Research Analysts” for a company owned by Clare but actually ended up working as “Multi-Cultural Development Specialists” (AKA unqualified “nannies”) for Rainbow Cultural Garden LLC.

– The use of various illegal schemes to assist sexual partners of Raniere to enter – or remain in – the U.S. This specifically included hands-on assistance from Kathy Russell and Clare Bronfman.

– The arranging of “sham marriages”, often at the direction of Clare or Keith, so they could have various non-citizens remain in the U.S.

– The recruiting and grooming of sexual partners for Raniere – which was done at his direction – both before and after he founded NXIVM. This included at least several underage girls: i.e., a 12 or 13-year girl when Raniere was running CBI – and a 15-year old when he was running NXIVM.

– The use of aggressive – and, in several instances, illegal tactics to gather personal information about perceived enemies of Raniere. “The targets of these efforts included federal judges overseeing litigation in which Nxivm was a party, political operatives, high-ranking politicians, reporters, ex-girlfriends of Raniere, Nxivm’s own lawyers, legal adversaries, and their families, John Doe 2 and John Doe 1’s employer”.

– The use of abusive litigation – and the obstruction of justice – “to seek retribution against individuals who left Raniere, defected from the Nxivm community or who spoke critically of either”. This included Clare’s active attempts to get various people indicted – and Keith’s false and misleading testimony in his lawsuit against AT&T and Microsoft.

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So, just imagine what kind of impression a juror will form about whichever of the current defendants – Keith Raniere, Clare Bronfman and Kathy Russell – ultimately decides to go trial when they hear about all those “uncharged criminal acts and other acts”.

And remember, the jurors are going to hear all that BEFORE the prosecution introduces any evidence about the crimes that each of the remaining defendants has been charged with.

Seriously, if Judge Garaufis allows this evidence to be introduced – which I believe he will do – you’ve got to wonder why any of the defendants would choose to go forward with the trial.

Viva Executive Success!

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Editor’s Note: One week after it filed this motion, the prosecution unveiled the second superseding indictment – which, among other things, included charges of possession of child pornography and sexual exploitation of a child. Although those crimes were subsequently dismissed and transferred to the NDNY for prosecution, it will be up to Judge Garaufis to decide whether evidence of them can still be introduced in the EDNY trial to prove the existence of the criminal enterprise.