Parral, Chile -- The group's reclusive leader is accused of sexually abusing scores of young boys. Former political prisoners say they were imprisoned and tortured in underground dungeons in the group's compound. An American who disappeared on a hiking vacation is reported to have been executed there. More than 50 other charges are pending against the group and its leaders, ranging from kidnapping and forced labor to fraud and tax evasion.
Yet the paramilitary religious sect known as Colonia Dignidad continues to flourish here in a 70-square-mile enclave in the Andean foothills that remains, in the words of a recent Chilean congressional report, a heavily armed "state within a state."
Protected by barricades, barbed wire, roadblocks, searchlights and hidden cameras and microphones, Colonia Dignidad has for more than 40 years been the fortress home of about 300 people, most of them German citizens. Their only loyalty is to the sect's German-born founder, Paul Schäfer, who likes to call himself the Permanent Uncle and preaches an apocalyptic creed that includes strong anti-Semitic and anti-Communist elements.
"The question that must be asked is this: How can this be possible?" Georg Dick, the German ambassador to Chile, said in an interview in the capital, Santiago, 250 miles north of this place where the group holds sway. "I have heard a lot of explanations, but I still do not understand how a group living in a closed area, accused of various crimes, can defy a free and sovereign state."
Chilean investigators say part of the answer lies in the "web of protection" supplied by sympathetic military and police officials nurtured by the group's leaders during the long dictatorship of Gen. Augusto Pinochet. Though the general's rule ended nearly 13 years ago, those allies still hold powerful positions.
With this influence, Colonia Dignidad has managed to fight what Jaime Naranjo Ortiz, a senator who led a committee that investigated the group in the mid-1990's, called "a guerrilla war in the courts" financed largely by its success in transforming a colony founded as a charitable organization into a diversified business group.
"They easily control properties and enterprises worth more than $100 million through their various holding companies," he said. "They are involved in real estate, mining, commerce and agriculture, just like any of several better-known business conglomerates in this country."
Other legislators suspect that the Chilean government is reluctant to move against Colonia Dignidad for fear of a collective suicide, like the one in Jonestown, Guyana, in 1978, or a violent confrontation similar to the deadly standoff at the Branch Davidian compound near Waco, Tex., in 1993. The group has encouraged such concerns by distributing fliers around its compound warning that it is prepared to "take a drastic decision" if pushed too far.
An itinerant lay minister preaching a fiery, millenarian brand of Protestantism, Mr. Schäfer, who was a nurse in the Luftwaffe during World War II and is now in his 80's, arrived here with a small group of his followers in 1961. Even then, he was fleeing sexual abuse charges based on complaints by boys in an orphanage he administered in Germany, though the Chilean government appears not to have been aware of those charges at the time.
Through the years, Colonia Dignidad leaders courted sympathetic military officers and members of Chile's German immigrant population by inviting them for visits and offering them and their families gifts or free medical care. After General Pinochet seized power in 1973, ties grew even closer, developing into a de facto alliance.
According to a government investigation a decade ago, the group bought a house here in the mid-1970's and donated it to state intelligence for use as a regional headquarters. A police telephone line was installed at the colony compound, human rights groups say, and the intelligence chief, Gen. Manuel Contreras, became a frequent visitor. Political prisoners whom the dictatorship wanted to keep out of sight were hidden in cells within Colonia Dignidad and tortured, those who survived have testified.
Still, even with the return of democracy here in 1990 and the suspension of the group's charity status a year later, the enclave thrived. It was not placed on the defensive until 1996, when a boy at Colonia Dignidad's boarding school smuggled out a letter to his mother complaining that Mr. Schäfer was molesting him.
The mother eventually pressed sexual abuse charges, which led to a flood of similar accusations and the filing of nearly a dozen additional sodomy, assault and abuse complaints against Mr. Schäfer.
Under Chilean law, the boys cannot be identified by name because of their age. But they and older boys who have escaped from the compound have uniformly described a system in which the Permanent Uncle - a name chosen to convey both intimacy and omnipotence - preys on boys 8 to 12 years old, forcing them to sleep in his bed and also sexually molesting them in collective showers and in his Mercedes-Benz.
"These are poor kids whose families sent them to live at Colonia Dignidad in hopes of a better life for them," said Hernán Fernández Rojas, a lawyer who is representing many of the youths on a pro bono basis. "Schäfer thought he could do what he wanted with these boys within the enclave he controls and that they would have no way to defend themselves."
Because it shuns all but the most limited contact with the outside world, Colonia Dignidad does not have a spokesman, and its members have been known to attack reporters and other outsiders who approach its property. Gen. Rodolfo Stange, a former commander of the national police and champion of the group, who is now a senator, declined a request for an interview, as did several lawyers who have represented the organization in court cases.
But Otto Dörr Zegers, a prominent psychiatrist in Santiago who has served on the board of the Colonia Dignidad hospital, continues to defend the sect. He said the group had been the victim of "unjust attacks and treatment" that were part of "a curious hatred campaign" organized by the Chilean government.
"I know them, and they are well-intentioned people," Dr. Dörr said. "Their ideology is a little bit old-fashioned, like that of the Mennonites who went to the United States, but nothing justifies the coordinated, synchronized lies and distortions that have been invented about them."
Mr. Schäfer controls every detail of his followers' lives, including who can marry and when couples are allowed to have children, who are raised in a common house separated from their parents. As a result, birth rates within the sect are very low and the average age of believers has risen; only the addition of a few Chilean converts, mostly orphans and abandoned peasant children, has prevented a decline in population.
Since the molestation charges were filed, Chilean authorities have tried several times to arrest Mr. Schäfer in raids on the site here. But those efforts have been met either with physical resistance by sect members or with other sect leaders saying that Mr. Schäfer was not present, that he had died or that no one with his name was a member of the community.
As a result, in May a judge ordered the charges against Mr. Schäfer to be shelved, on the ground that it was impossible to find him. A warrant for his arrest remains in force, however. Government investigators say they believe he is either still in the Colonia Dignidad compound or in a safe house the group owns near the National Stadium in Santiago.
"They file writ upon writ, knowing that the state does not have the resources to keep up with them," Mr. Naranjo, the senator, said, describing how the group has held off legal challenges with the help of its powerful allies.
In some cases, court records and files, hardly any of which are computerized in rural Chile, have simply disappeared. The police have also refused to act on search warrants, saying they do not have enough men on duty, or have delayed acting on such orders for months.
In other instances, energetic prosecutors or investigators have been transferred to the other end of the country or promoted to desk jobs in Santiago. Cases whose outcome seems unfavorable to the sect can sometimes be transferred to a separate military court system, whose impartiality lawyers and human rights groups have questioned.
For four decades, the sect has cultivated ties with civilian right-wing parties and is suspected of compiling dossiers on leading public figures that investigators say could be used to blackmail its targets.
President Ricardo Lagos, a Socialist, in an interview in Santiago in May, denied suggestions that his government had been lax in trying to hold Colonia Dignidad and its leaders accountable for violations of Chilean law. He acknowledged a lack of progress, but said it was not for want of effort.
"The government has put a great deal of emphasis on this matter," he said. "I think it is unfortunate that with Colonia Dignidad there has not been the success that had been hoped for."
Among the group's victims may be an American mathematics professor, Boris Weisfeiler, who disappeared while hiking just south of Colonia Dignidad in January 1985. A Chilean military informant later told officials at the American Embassy in Santiago that Dr. Weisfeiler, a Russian Jewish immigrant, had been executed in Colonia Dignidad on orders from Mr. Schäfer.
Recently declassified State Department documents conclude that the informant's story "contains enough truths and plausibilities to make it believable." But the document added that the account would be "difficult to confirm without unrestricted access to other eyewitnesses or the Colonia Dignidad premises."
That does not seem likely soon. Critics of Colonia Dignidad, led by Senator José Antonio Viera-Gallo and other legislators with committees that have investigated the group, have urged the government simply to expel the sect's other dozen or so top leaders, all of whom remain German citizens after more than 40 years in Chile. Indeed, such a decree has already been issued against one of Mr. Schäfer's subalterns.
But like all other edicts issued against Colonia Dignidad, that order was appealed and has now been overturned. Courts ruled that the group's leaders cannot be banished from Chile until pending charges against them have been resolved and, if they are found guilty, their prison sentences served.
"That means we may never be able to get rid of them," said Mr. Viera-Gallo, who represents this area in Chile's Congress. "This thing just keeps turning around and around in circles. They are so powerful, with so much protection, that they have the ability to keep these cases going in the courts indefinitely."