The adult-entertainment industry has declared war on the fundamentalist Exclusive Brethren sect for allegedly infiltrating local councils.
The Canberra-based Eros Association says the conservative Christian group is bankrolling legal challenges to halt the spread of adult stores.
The accusations come after a group of Exclusive Brethren business leaders offered to fund Lithgow City Council's Supreme Court fight against a development application for a sex shop.
The Department of Local Government gave the offer a green light, claiming councils were allowed to "accept donations from third parties" - a clause critics say amounts to sanctioned bribery.
Flirt Adult Store owner Jeff Oliver won an appeal in the Land and Environment Court after the council refused him planning permission to set up shop in Lithgow's main street.
According to council and independent correspondence, local members of the Exclusive Brethren offered to fund the council's appeal against the court ruling.
The council was prepared to accept the money after the Department of Local Government decreed there was no legal impediment to it "accepting a donation from a third party".
It decided not to pursue the appeal, however, and the Flirt Adult Store was allowed to open.
About 100 members of the Exclusive Brethren live in the Lithgow area.
"There is increasing evidence that the Exclusive Brethren have infiltrated other morals groups around the nation and have embarked on a national campaign to stop adult retail shops from opening," Eros co-ordinator Robbie Swan said.
"There is also increasing evidence that their members are secretly being elected to local councils, with moral agendas their main reason for being there.
"There's an urgent need for a national enquiry into just how far this 'entryism' has gone and to what extent local government decisions on moral matters have been compromised by this cult."
Lithgow councillor Martin Ticehurst said he was disturbed by the fact it was perfectly legal for councils to accept money from groups such as the Brethren that wanted to influence outcomes.
"It's not just the involvement of religious groups that concerns me. Councils should not be allowed to accept money from any activist group," Mr Ticehurst said.
"It could be perceived as a form of bribery, and I think it's potentially dangerous."
The sect, which does not allow its members to vote, is known for its large donations to the Liberal Party.
