Brethren reap millions in tax-free donations

The Age, Australia/September 23, 2006
By Michael Bachelard and Christian Catalano

The leaders of secretive Christian sect the Exclusive Brethren enrich themselves to the tune of millions of dollars a year, tax free, by drawing systematic donations from their flock.

Former Australian Brethren leader Ron Fawkes told The Age that a previous world leader, American James Symington, boasted of buying 600 hectares of prime North Dakota ranch land out of the proceeds of the donations.

Mr Fawkes was excommunicated in 1984 and cannot comment on the size of gifts going to the current "Elect Vessel" of the church, Sydney office equipment supplier Bruce Hales, but believes they would be worth millions of dollars a year.

"I was very close to Symington. He received big money. I estimated at that stage, in the 1980s, that it was well over a million a year," Mr Fawkes said.

The group also claims council rate exemptions on each of their dozens of parcels of land in Australian capital cities on the grounds that they are used for religious worship.

The closed and immensely wealthy Exclusive Brethren have been outed recently as spending large sums trying to influence elections in the US, Australia, New Zealand and, most recently, Sweden.

The Age discovered that the Brethren were planning a foray into Victorian state politics with a campaign in support of Nationals leader Peter Ryan, and against the Greens.

In New Zealand yesterday, a private detective confirmed that Exclusive Brethren members hired him and a colleague to dig dirt on Labour MPs, including New Zealand Prime Minister Helen Clark and her husband, Peter Davis. Ms Clark defended her husband against allegations of homosexuality, of which the Brethren strongly disapprove.

The Supreme Court of Queensland ruled last December that Exclusive Brethren were not eligible for the millions of dollars in rate exemptions they claimed during the 1990s because their church services were held in private, and did not fit the category of "public worship".

That finding was echoed by the experience of an Age journalist this week, who was refused entry to a Brethren meeting on the basis that he "could be the most corrupt man in Melbourne".

However, it has emerged that the Brethren, through the tightly held trusts which control all their landholdings, have applied to the Brisbane City Council once again for a rate exemption.

A council spokeswoman said the Brethren had offered to make changes to their premises or practices.

In Victoria, the laws are looser, with any group using land "for the advancement of religion" entitled to an exemption. In Melbourne, the Brethren's main meeting hall is in Pascoe Vale. However, they have recently fought and won three planning battles to have new halls in the Eltham area, part of a move to be close to the home of their state leader, John Gadsden, in Diamond Creek.

Other satellite Brethren zones are in Lilydale and Boronia.

The Age has learnt that devotees of the secretive sect are encouraged to make weekly donations for the general upkeep and expenses of the churches, and more cash to go into a "fighting fund" reserved for legal battles, most against their own excommunicated members in the Family Court.

There is also a monthly donation called the special collection. "That is money collected and then distributed as gifts to the leaders, not to the poor," Mr Fawkes said.

"Most assemblies would give the money to the most prominent leaders around the world, but mainly to the Elect Vessel. It would mainly be those who were prominent on the world stage, maybe half a dozen in each country, and others at a more regional level who would perhaps be given a gift, but it would not be a lot."

Mr Fawkes said there would be also be some flow of money to needy Brethren, but only on a small scale. Most Brethren families were relatively well off.

"There never appeared to me to be a huge amount of need. But they are different to churches that provide outreach, support to the needy — there's none of that at all," he said.

Mr Fawkes said Brethren members were "very much" encouraged to make donations to the church, and to leave property to the church when they died.

Mark Humber, a former member who fled the sect in 2000, said that when people were elderly, "they would make quite a fuss over them".

Mr Fawkes donated the 1½-hectare plot of land on which the Perth meeting house was built, land that would be worth millions now.

The complex series of "Gospel Trusts" that own Brethren land make it almost impossible to estimate how much the sect is worth. But Mr Fawkes estimates "it would run into hundreds and hundreds of millions of dollars".

The Brethren have also set up a number of London-based companies, including Ratby Ltd, which apparently funds its forays into election campaigns.

The Brethren have also grown wealthy from their success in business, with some well-known family businesses run by Brethren members. Millions of dollars was brought into the sect from the sale in the 1960s of the McAlpin family's flour business and Mac's shortbread company. Victorian leader John Gadsden comes from the J. Gadsden container group family, which until recently manufactured milk cartons and beer bottles.

Brethren members own a range of medium-size businesses in trade areas, such as A Line Garages, Billi Systems (for under-sink water filters), Sitecraft storage and materials handling, and a whole range of pump distributors and fitters, including Allpumps and Quickflow.

"They have a single-minded dedication to business because there are no other pursuits that one can have," Mr Fawkes said.

However, current "Elect Vessel" Mr Hales has recommended followers treat non-Brethren business people with contempt, to avoid contamination.

One of the Brethren's three Melbourne hubs lies in the Moreland municipality, north of Melbourne's CBD. Among the quiet streets of Pascoe Vale, Glenroy, Oak Park and Hadfield, several members have made their homes within walking distance of places of worship.

At least seven of the churches — including the sect's main meeting point in Walter Street, Hadfield — are within a two-kilometre radius of one another. Passers-by are treated to the shuttered windows, cyclone fencing or the padlocked gates that surround nearly all. There are no welcome mats or Christian symbols, nor anything identifying them as belonging to the Exclusive Brethren.

The sect lodged a planning application with the Moreland council this week through its private school arm, Glenvale, to change the church at 8 Lytton Street, Glenroy, into a Brethren private school.

A former Brethren member said the schools, though they did not allow computers to be used, were well maintained, and a lot of time was spent on educating the children well. However, the sect's rules dictate Brethren are not allowed to attend university.

The Age has established that the church's properties are held in trust under a variety of trust deeds. A number of the trust deeds, obtained by The Age, show local Brethren dignitaries as trustees, including Peter McAlpin, Richard Garrett, Henry Burgess and Richard Gadsden.