In the Grip of the Worst Guru #3 – Stealing from Disciples 20 Years Ago

In the Grip of the Guru was the extraordinary four-part series by Richard Read for the Oregonian published in 2001.

FR is republishing this ground breaking series, which likely prevented many people from joining the world of the strangulation swami. Sometime after it was published, the four-part series seemed to disappear from the web.

What it shows is that 21 years passed and nothing changed. The Swami hurt his followers then as he does now.

Read is a two-time Pulitzer Prize winner.

Columbia University President George Rupp (left) presents (left to right) Julia Sullivan-Springhetti, Brent Walth, Kim Christensen and Richard Read, of The Oregonian, with the 2001 Pulitzer Prize for Public Service.

Part 1:  Securing a Spiritual Empire.

Part 2: Broken Trust

Part 3 The high price of enlightenment 

Ex-disciples say Swami Chetanananda leaned on his followers to pay for the trappings of his spiritual organization and for investments that failed

Tuesday, July 17, 2001

By Richard Read of The Oregonian staff

Hone Ames doodled furiously in the kitchen of her Cambridge, Mass., home in 1989.

In the grip of the guru
Swami Chetanananda has attracted educated people as followers, but dozens of ex-disciples accuse the guru of financial, sexual and spiritual abuse

Even many years later, she still clearly recalls cradling the phone as Swami Chetanananda pressed her for more money in 1989.

Resist,” Ames wrote in the margin.

But resistance is a slippery slope, Ames recalls Chetanananda saying: If you resist, you end up in a pit, you cannot dig out. The whole point of this spiritual practice is that you’ve got to commit.

Ames says the swami asked for another $62,500 to invest in the conversion of a run-down New Jersey apartment building into condominiums. Come on, Hone.

Hone. The swami coined the nickname for Ames as one of his closest insiders. He’d tease her about it. Call Hone. Hone on the range. There’s no place like Hone.

Now that she’s left the swami, the nickname she left behind reminds Ames of the person she says she was: Completely controlled by the man she worshipped and feared as her link to God. She says she remains traumatized by the financial losses and psychological pain she and her family suffered.

Ames, 59, still has her notes from that phone conversation with the guru Nov. 14, 1989. The words “briar patch” and “manifestation of fear” appear circled and underlined in the margins. The jottings reveal Ames’ doubts as she financed ventures promoted by Chetanananda, the persuasive spiritual leader who now lives with his followers in a refurbished manor in Northeast Portland.

Chetanananda refused repeated requests for an interview with The Oregonian concerning finances and other issues. Last Thursday, he submitted a typed statement in response to a summary of allegations.

Chetanananda did not specifically respond to the allegation that investments he advised had resulted in losses of large sums of money for disciples and for him.

“I have never coerced anyone, period,” he wrote, in apparent reference to an allegation that he had coerced students to give him and the Nityananda Institute valuable gifts, to loan him and the institute money and to invest money to fund an opulent lifestyle.

Ames recalls bearing down on her notes that day in 1989, caught between the man she idolized and the warnings of her father and a financial adviser. She says she wanted to help the swami create a retirement fund for his assistants, whom she pitied for their low pay and lack of benefits.

The year before, Ames had invested $250,000 in the same New Jersey condo deal after what she describes as heavy pressure from the swami. She says he ostracized another disciple who declined, a fate she was anxious to avoid.

Ames deposited the initial investment in an account she held jointly with the swami and one of his assistants. A copy of the wire transfer shows that the guru, using his original name, J. Michael Shoemaker, sent the money to the bank financing the condo conversion, which was developed by the husband of a former girlfriend.

Ames provided The Oregonian with detailed documentation of investments and other transactions from 1988 to 1997, when she left the ashram.

Now Chetanananda was telling Ames they needed more money. Ames doubted him, recalling her financial adviser’s prediction that New Jersey’s housing market was about to dive. But, she reasoned, the adviser wasn’t all-knowing like the swami.

So, on Nov. 16, 1989, bank records show, Ames deposited $62,500 into the joint account. She still has the check for that amount that the swami wrote to Executive House LP the same day.

Ames says she couldn’t say no to the guru.

“People are concerned about teachers because they’re afraid they’re going to get ripped off. There’s no avoiding getting ripped off to some extent in this life.”
— Chetanananda, on a tape-of-the-month recorded Jan. 24, 1988

Former disciples of Chetanananda say that they and other followers showered him with gifts, including Asian artwork, camera equipment, first-class air tickets and accommodations in Hawaii’s Four Seasons Hotel and other luxury hotels.

Newsletters routinely list dozens of members giving thousands of dollars a year to the institute, a tax-exempt church.

Norman Bodek supported the Swami.

Property records show that in 1999, longtime disciple Norman Bodek signed over his Northeast Portland house to the swami’s Nityananda Institute, listing it as a charitable contribution. Bodek, who has since left the swami, ran Productivity Inc. The publishing and event-planning company gave jobs to dozens of disciples and — according to Ames — paid the guru a monthly retainer.

Money, in addition to spiritual teachings, group meditation and sex with the guru, continues to bind disciples into the guru’s inner circle, the former followers say.

Ames was by no means the swami’s biggest backer. But she says she dug into her savings, spending an inheritance from her grandmother and other reserves.

Ames says that in 1987, as a college-educated resident of Bloomington, Ind., she joined Chetanananda’s group after seeking his advice about her troubled marriage and her mother’s declining health. Slowly, she transferred her devotion to God to the swami until she recalls seeing him as a Christlike figure.

Ames viewed Chetanananda as a “spiritual atomic generator,” a gifted astrologer and an all-knowing sage. When he walked into the room, she felt a rush of devotion and love for the man she considered divine, often leaving her feeling faint.

She said she first invested $100,000 in one of his ventures in April 1988 after he told her about a computer program developed by disciples to pile up profits trading commodities.

Bank statements she produced show that by August, the joint-account balance sank to less than $82,000. Within a year, the balance plunged below $300.

Ames recalls the swami telephoning her at her home late that year with the bad news. She says he told her they’d lost all the money on chromium.

Ames wouldn’t let herself cry.

She fought back doubts. This was a test, Ames thought. This was a chance to show that her devotion to the guru meant far more than money.

“I’ll move to Portland. I’ll either have enough people in that building to support it, or I’ll go fly-fishing.”
— Chetanananda, on a tape-of-the-month recorded in December 1992

Ames studied documents spread across a Boston lawyer’s broad kitchen table on an evening in early 1993.

She was about to lend the Nityananda Institute $500,000 so the swami could finally build a proper meditation hall. Chetanananda and his followers had searched for months for new quarters to replace their cramped houses in Cambridge.

They settled on a big brick building in Portland, Laurelhurst Manor, built in 1910 as the Anna Lewis Mann Old People’s Home. Property records show that the institute borrowed $840,000 toward the $1.2 million price of the house off Northeast Sandy Boulevard. The institute and disciples later bought — and still own — a dozen other houses nearby.

But the big brick building at 1021 N.E. 33rd Ave. needed extensive remodeling. Ames says Chetanananda told her the financial demands put him in a vise.

Ames recalls thinking that whoever came up with the money for the hall would deliver salvation to the messiah.

A written agreement shows that Ames made the $500,000 loan for up to three years. She charged 6 percent interest and asked that her support be anonymous. The institute listed its collateral as a house and land on Martha’s Vineyard, the island off Cape Cod where the swami held retreats. The Vineyard property was up for sale.

Ames toyed with the idea of giving all her money to the institute. If this man was God, she says she reasoned, why hold back anything?

“As a swami, of course, I don’t have the usual signposts in life that tell me I’m a success or a failure. For instance, when you’re a swami, you don’t get a salary.”
— Chetanananda, on a tape-of-the-month recorded Jan. 2, 1993

Ames says that in April 1994, Chetanananda called her into the study of his suite in the Portland manor. She saw his dark expression and braced for trouble.

Ames had moved into the big brick building in 1993. Disciples had beautifully refurbished the structure, renaming it the Rudrananda Ashram. They added a spacious meditation hall financed by Ames’ loan, with a two-story arched ceiling and a prominent statue of Nityananda, the Indian guru credited with beginning the swami’s lineage.

Fresh flowers arrived by air from California, former members say. French wine flowed in the swami’s suite, they remember, with the empty bottles taking a discreet path to the garbage bin past disciples who shunned alcohol and meat.

If you loved your Swami, would you deny him a 1700 bottle of French wine or would you want the being who is bringing you salvation to have the very best?

But Chetanananda appeared pained to Ames as he stood by the oval oak table in his office. Ames says he told her that the New Jersey condo deal had collapsed. All the money was gone.

In fact, court records show, the troubled condo company, Executive House Associates LP, had filed Chapter 11 bankruptcy three years before. By 1994, lawyers were fighting over the last scraps.

Later Ames asked the swami for documentation so she could write off her loss for taxes. He became furious and picked up a chair as though to hit her, she recalls.

Ames says the swami told her to talk with his brother, attorney John Robert “Bob” Shoemaker, also a disciple. She still has the memo she received from Shoemaker saying that he had no information concerning the bankruptcy.

“As you know,” Shoemaker wrote, “the partnership never listed you as a partner. The investment was made in Swamiji’s name, and his taxpayer i.d. number was used.”

“Egotism, . . . the fundamental sickness of human beings, is what people come here to be cured of. And you know, I run a hospital. I live here 24 hours a day, seven days a week. I’m on call for the last 25 years. This is not a benefit to me. It is a benefit to you.” — Chetanananda, on a tape-of-the-month recorded in January or February 1996

Ames says Chetanananda paid a visit in February 1996 to the ashram office where she edited his lectures on salary from Productivity Inc. Ames remembers him saying Productivity was in trouble and might stop paying his retainer.

She heard him say ashram finances were dire. The Martha’s Vineyard property still hadn’t sold. Moreover, Pennzoil, owner of the neighboring Jiffy Lube on Sandy Boulevard, might build a carwash on a vacant lot next door to the meditation hall, spoiling the ambiance.

A written agreement shows that the next month, on March 8, 1996, she signed a one-year extension of her loan to the Nityananda Institute. Some of the pressure was off the institute’s finances.

“I probably try to do too much already, managing this place, carrying on my head the debt load that it represents. I don’t know if any of you have been $2.5 million in debt before. All of you who have money pressures on you know what that’s like. Well, magnify it a bunch.”
— Chetanananda, on a tape-of-the-month recorded April 2, 1996

Walter Delaney, the rumpled, white-haired fire chief on the western tip of Martha’s Vineyard, spent April 2, 1996, poking through the ashes of the house where Chetanananda once held summer retreats.

Pop singer James Taylor had spotted the fire raging late March 31 across the bay from his home. Taylor called the Gay Head Volunteer Fire Department, made up of a crew of carpenters and fishermen.

Fire trucks raced down Lobsterville Road. Firefighters found the two-story house blazing. They struggled to pump water from a nearby stream. But the wood-frame building was a total loss.

Delaney lists the cause of the fire — which broke out hours after six disciples had finished a weekend of painting and cleaning — as undetermined.

The fire, it turned out, was manna from heaven. The property would be easier to sell without the house. And the institute’s insurance firm paid several hundred thousand dollars to the Nityananda Institute for the loss, according to a company spokesman who declined to give the exact amount.

The month after the fire, the institute completed its purchase of the vacant lot from Jiffy Lube. Disciples in the great hall financed by Ames could continue chanting and meditating undisturbed. And the grassy lot was perfect for running the ashram’s six Rottweilers, attack-trained by a man flown out from Boston.

“The love and devotion we display toward a teacher is a crucial part of the transformation process.”
— Chetanananda, in his book, “Choose to be Happy,” Rudra Press, 1996

Ames says she felt Chetanananda glaring at her across the desk in his suite Jan. 1, 1997.

She recalls watching the swami’s face turn bright red as he yelled at her, faulting her for skipping a kitchen chore. She says she had merely overlooked the job on an assignment sheet and was devastated that he would think she had missed it intentionally.

And then it dawned on her.

My God. This man doesn’t even know who I am.

She says her years of doubts about Chetanananda bubbled to the surface. The temper tantrums. The false predictions. The disastrous investment schemes. The insults and put-downs. His sexual conduct.

Ames stayed inside the ashram for several more months, agonizing over her allegiance. During this time, she says, she was pressured to convert her $500,000 loan into a gift.

But something had changed. She didn’t think of Chetanananda as God anymore.

“There is one thing I want to make really clearly, and that is I am a liberated soul. . . . I think it may not be possible for a liberated soul to live in the company of human beings.”
— Chetanananda, on Aug. 12, 1997, in a taped talk

A former disciple’s snapshot shows Sharon Ward, the guru’s right-hand woman, standing barefoot beside visiting white-robed monks at the Portland ashram. Flames sputtered from the Portland ashram’s mortgage papers in the institute’s fire pit in July 1997.

Ex-disciples recall Ward, wearing a crisp white blouse and long flowery skirt, clapping as Chetanananda thanked disciple Kerry Ernest Smith. Smith had succeeded in the bakery business after running the ashram-affiliated bakery company in Bloomington years before. Now, Smith had returned to donate $1.7 million to pay off the ashram’s mortgage, Ward said.

But Ward faced still more challenges:

The institute would soon have to repay Ames the $500,000 plus interest.

The Martha’s Vineyard acreage hadn’t sold.

And Melinda Mandell, a former institute member, was suing Chetanananda and the institute. Court records show that she alleged misrepresentation, intentional infliction of emotional distress, breach of contract and racketeering. Mandell sought more than $4 million, claiming the swami had never delivered on a promise to provide ashram housing and instruction if she left her law practice in Boston.

Mandell claimed in the suit that the institute was not a charitable church organization but a for-profit enterprise operated for the benefit of Chetanananda, Ward and other key followers including Bob Shoemaker, the guru’s brother and Ward’s husband.

Lawyers for the swami and the institute denied all of Mandell’s allegations, later describing the racketeering claim as “confusing, jumbled and scattershot.” The lawyers said that institute representatives denied they had promised ashram instruction, and that Mandell failed to prepare to find employment in Oregon.

The parties ultimately would settle the suit in 1999, under confidential terms. But as complaints and summonses flew in the summer of 1997, the Nityananda Institute began requiring members to sign a form releasing the swami and his church from any liability.

The form said the student understood that Chetanananda, “the abbot,” did not provide counseling, health care or confidential relationships. “I accept that I am fully responsible for myself and my life,” the form said, “including my own actions, behavior, thoughts, financial status, health, relationships, and any other condition.”

By Aug. 3, 1997, Ward, the ashram’s executive director, wrote in a letter to Ames, that she had secured a bank mortgage. She paid off the $500,000 loan to Ames and began negotiating interest payments with her.

A portrait of Michael Shoemaker AKA Swami Chetananda levitating. 

After the mortgage-burning ceremony and a retreat session for institute members, Ward used some lines from Basavanna, a 12th-century poet, in a fund-raising letter. A copy of the Aug. 7, 1997, draft reads: “Can there be devotion in words and more words? Can there be devotion unless the body is spent, unless the heart is spent, unless the wealth is spent?”

The letter continued: “Swamiji has been working so hard, and giving so deeply and freely of himself, that by the end of the retreat, he was exhausted, and so hoarse that he could barely speak.

“In his brief and beautiful closing remarks, he said to us repeatedly, ‘Don’t hold back.’ ”

“If you’re the person who’s (expletive) judging what work you’re going to do all the damn time, what do you need a teacher for? . . . I am constantly meeting people who are sitting in judgment of what I am communicating to them. You can’t believe how frustrating it is for me to see people who think they’re better than me.”
— Chetanananda, Aug. 28, 1997, in a taped talk, three weeks after the fund-raising letter

Ames says she moved out of the ashram Dec. 9, 1997. She twisted her ankle carrying a box out to her car.

She says that no one asked her why she was leaving: No one wished her well.

“I bust my guts out for people who mostly wonder, you know, ‘What in the hell happened?’ and ‘What’s that son of a bitch trying to get from me anyway?’ Well, the truth of the matter is, I’m after your money. (laughter from audience). Or, I could be after your bodies. (more laughter).
— Chetanananda, during a talk in February 1998, after Ames left

In 1998, Martha’s Vineyard conservationists hiked across the Nityananda Institute’s island acreage, admiring the breathtaking view across Menemsha Bight. They had eyed the property five years before, but their organization usually avoided land with buildings.

Now minus the house, the secluded 28 acres were attractive, with their rolling hills, dense woodland, wetlands, streams and a peat bog. That September, Martha’s Vineyard Land Bank commissioners approved the purchase of the property for $1.2 million.

The Nityananda Institute gained some breathing room. Ames got her interest money back. But more trouble loomed for Chetanananda.

“You are a cowardly, vengeful, venomous witch. . . . I do not sexually abuse women. . . . I have never cheated you in business. . . . If you don’t stop these slanderous lies and harassment of members of our community, I will sue you. . . . I will make the process as ugly and expensive as humanly possible.”
— Swami Chetanananda, May 14, 1998, in a letter to Ames

Researchers Lynne Palombo and Gail Hulden contributed to this report.

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  • Swami Chet seems like a real asshole, but by what definition is this “stealing”? Certainly not the legal definition.

    Aside from the sexual abuse, which is the only possible way he might face a criminal charge, Swami C isn’t doing anything your average fast-talking charismatic mega church minister or televangelist isn’t doing.

    High pressure sales tactics to wring contributions to his tax-exempt ministry / church / temple.

    Fleets of luxury cars, private jets, Rolexes, a mansion to live in. It’s all perfectly legal and no taxes to pay.

    If people are dumb enough to give money to these people there’s nothing the cops can do about it. It’s not stealing.

  • For those of us who were truly wanting spiritual practices and community that would support our true yearning to find God, well, speaking for myself, this whole part of my journey was the biggest lesson of my lifetime. I did not have a history abuse. I was seeking higher wisdom and practices that would take me closer to God in authentic ways.

    The guru paradigm teaches that you must surrender, trust the guru, etc. I believed those teachings for a lot of years until I could finally see that these were self-serving doctrines perfectly constructed to enable narcissistic psychopaths and their agendas to control communities of people with religious “credibility.”

    I left. I tried to tell others still at the ashram that things weren’t right there. I had so many friends still living at the ashram. Good people. People I really cared about. I had no idea of the truly evil acts that were happening until years after I left.

    I have my direct connection to God. I need no other human intercessor to be with God. I learned never to give my power away. I learned it the hard way.

    I stand strong now, and the truth about Michael Shoemaker, (Swami Chetanananda) and his demonic circle will come out in a powerful, meaningful, and effective way. It’s coming out because truth prevails.

    That includes holding those around SC responsible as well: Gretchen Kreiger, Sharon Ward, Theresa Altmeyer Smith Khan, Salmon Khan, Howard and Vivina Boster, Ruth Knight, Jim Brissette, Monica O’Neal, Michelle Lawson Valentino, Ana Brook, Victor Ustov, Kelly Ponzi, Claudia Henry, Govind, and all others who continue supporting SC in his abuse in Gold Beach. By sticking with SC you make his ongoing abuse possible.

    The Frank Report is a service to humanity. Thank you, Frank.

    • Well said. And what a devastating lesson it was.

      Add to that: Jen Wilhelm, Bob Shoemaker, Heather George, Tom Fabrizio, Patty Slote, Chris Jackson, Laura Santi, Susan Marshall and Timothy Shiels, Karen and Jerry Sutherland, Cecelia and Ulla Hellner, Marilyn Ritter, Rio Hibler, Belle Moffa, Tara and Michael Israel, Eddie Rosen, Dr Aiden Seraphim, Jan La Rue, Cheryl Rosen, Kari Gronningsater, Belle Moffa, Isa Raim, John Tracey, Lois Tallon, Saroj Bardewa, Sophie (Sylvana) Balsimelli and her daughters.

      You are all complicit. You are responsible while you stand with him.

About the Author

Frank Parlato is an investigative journalist.

His work has been cited in hundreds of news outlets, like The New York Times, The Daily Mail, VICE News, CBS News, Fox News, New York Post, New York Daily News, Oxygen, Rolling Stone, People Magazine, The Sun, The Times of London, CBS Inside Edition, among many others in all five continents.

His work to expose and take down NXIVM is featured in books like “Captive” by Catherine Oxenberg, “Scarred” by Sarah Edmonson, “The Program” by Toni Natalie, and “NXIVM. La Secta Que Sedujo al Poder en México” by Juan Alberto Vasquez.

Parlato has been prominently featured on HBO’s docuseries “The Vow” and was the lead investigator and coordinating producer for Investigation Discovery’s “The Lost Women of NXIVM.” In addition, he was credited in the Starz docuseries 'Seduced' for saving 'slave' women from being branded and escaping the sex-slave cult known as DOS.

Parlato appeared on the Nancy Grace Show, Beyond the Headlines with Gretchen Carlson, Dr. Oz, American Greed, Dateline NBC, and NBC Nightly News with Lester Holt, where Parlato conducted the first-ever interview with Keith Raniere after his arrest. This was ironic, as many credit Parlato as one of the primary architects of his arrest and the cratering of the cult he founded.

Parlato is a consulting producer and appears in TNT's The Heiress and the Sex Cult, which premieres on May 22, 2022.

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