Sensei's World

Forbes International/September 6, 2004
By Benjamin Fulford and David Whelan

Soka Gakkai, a strikingly wealthy Japanese sect, tries again for U.S. glory with a splendid new campus. Daisaku Ikeda's unaccountable empire can thank lax treatment of the nonprofit world.

Walk the hilly campus of Soka University of America in Aliso Viejo, Calif. and you enter the fabulous world of the international nonprofit. The three-year-old school has so far put about $300 million into its 103 suburban Orange County acres, and this is still a work in progress. As of this fall, only 400 students will meander among the rich, Romanesque architecture.

The primary benefactor of Soka U is a controversial offshoot of Japanese Buddhism called Soka Gakkai, headed for 44 years by the sometimes messianic and persistently self-aggrandizing Daisaku Ikeda. But significant secondary support comes from favorable tax treatment in Japan, the U.S. and around the globe, just as enjoyed by other philanthropies big and small. In the U.S. the nonprofit sector is spending $875 billion a year and employs 9% of the work force yet has precious little accountability, other than the public financial statements required of most charities. Religious entities don't even have that degree of accountability. They enjoy all the benefits of tax exemption without any requirement that they say what they are up to.

Soka Gakkai is a shadowy case in point. Ikeda, now 76 and president of Soka Gakkai International, the sect's global umbrella, claims 12 million followers and has amassed an empire that was put at $100 billion by a Japanese parliamentarian a decade ago. (The sect says that's wrong but otherwise won't comment on its finances.) A nasty split from Nichiren Buddhists set off a cycle of alleged violence, blackmail and intimidation. Soka Gakkai members in Japan have been charged with illegal wiretapping and breaking into private databases. The sect says it has nothing to do with those activities, noting that its ranks include nearly 10% of all Japanese. But yet-darker allegations have been made (see box, p. 130).

Soka Gakkai (literally, "value-creating society") brings in, conservatively, $1.5 billion a year to the top line, according to our best estimates of its membership, its tithing demands and its commercial activities. Most of that revenue is collected in Japan, where the sect sells its flock funeral plots, assorted religious paraphernalia and a newspaper (5.5 million subscribers). The group's far-flung international assets include estates in France and the U.K. In gilded Santa Monica, Calif. a Soka-owned office high- rise and auditorium sit across Wilshire Boulevard from each other, near the town's beach. In the nearby hills a Soka affiliate holds the King Gillette Ranch-- which was used for footage of "Tara" in the film Gone with the Wind. A thousand spiritual centers worldwide include a site worth $6 million near New York City's Union Square.

In wealth and claimed following, Soka Gakkai exceeds more familiar sects such as Hare Krishna, the church of the Reverend Sun Myung Moon and today's hippest (Madonna, etc.) group, members of the Kabbalah Centre. In the U.S. a church can lose its federal tax exemption for getting into politics. Soka managed to get around a similar restriction in Japan, where Ikeda has built up a political party, New Komeito, that helps the long-governing Liberal Democrats hold power.

Soka University of Japan opened in 1971. Soka University of America, first established in 1987 on what is now a graduate campus in Calabasas, Calif., near Malibu, recently obtained preaccreditation for its undergraduate program from an outfit certified by the U.S. Education Department. A parallel process that will cover graduate students also is moving forward.

The preaccreditation means that for the past year American undergrads at Soka U--which reported to the IRS that its assets exceed $740 million--have been eligible to obtain up to $23,000 in federal Stafford loans over the course of their education. Needy recipients can get up to an additional $4,000 a year in Pell Grants.

What are Ikeda's aims? Five years after gaining command of Soka Gakkai, he told a Japanese writer: "I am the king of Japan; I am its president; I am the master of its spiritual life; I am the supreme power who entirely directs its intellectual culture." In the years since, "world peace" has been the sect's mantra. New Komeito promotes pacifism in Japan. Representatives of the sect have worked the UN and other official venues touting international harmony and goodwill--and usually Ikeda. Followers mount a traveling show equating him with Martin Luther King Jr. and Mahatma Gandhi.

In the sect's 1,000 meeting halls Soka members exercise the "life-enhancing" power of chanting. Believers are encouraged to be "many in body, one in mind." This means "You have to make sensei's [teacher's] heart your own. You have to fulfill [Ikeda's] dreams instead of your own," maintains Lisa Jones, a former aide and follower who ghostwrote an Ikeda book and now maintains a Soka-doubter Web site. "His dream is kosen-rufu, or what Soka members call â?~world peace,' which will be achieved when one third of the world chants, one third merely celebrates Ikeda, and the other third doesn't care," she says.

A Soka bid for favor in the U.S. a generation ago, drawing on the era's culture clash and some affiliated celebrities, attracted unwelcome press, and the sect receded a bit. But it has never given up efforts to establish legitimacy and further Ikeda's vision. He founded the Boston Research Center for the 21st Century in a 13,000-square-foot Georgian building next to Harvard University. Ikeda has enticed Mikhail Gorbachev and Henry Kissinger into numerous discussions. He also met with historian Arnold Toynbee, double Nobel Prize winner Linus Pauling and civil rights figure Rosa Parks (Soka's U.S. arm boasts a sizable black membership). Some of the conversations with luminaries have been published and sold.

More idealistic or benign than sinister and manipulative? The veil that surrounds the nonprofit world, especially religions, ensures that only the outlines are visible. Soka University files an IRS form; the organization behind it doesn't.

Congress is training its sights anew on nonprofits. Charles Grassley (R-Iowa) chairman of the Senate Finance Committee, held hearings in June on tax-exempt abuses. "Far too many charities have broken the understood covenant between the taxpayers and nonprofits," he said. He was angered by local news reports about the looting of family foundations. On Aug. 10 the Internal Revenue Service promised to increase from 230 to 300 the agents it assigns to nonprofit entities. This tiny crew is supposed to take on 1.6 million tax-exempt organizations and an estimated 400,000 additional religious groups that do not have to submit annual tax forms to the IRS. Investigations are typically initiated only in response to complaints. Exceptions to this passive role include the IRS' decades-long losing war with the Church of Scientology.

In the post-Sept. 11 era some Muslim groups have come under scrutiny for ties to terrorism. The Department of Justice recently prosecuted the former head of the American Muslim Council and indicted seven leaders of the Dallas-based Holy Land Foundation. But unless you're tied into terror, you can shout from the rooftops and no one is likely to come looking at your books. "Every revenue agent you assign to a corporate tax return will generate millions of dollars. Every [revenue agent] you assign to a tax-exempt one may not pay his own salary," says Marcus Owens, who headed the IRS' Exempt Organizations division from 1990 to 2000 and is now a private Washington attorney.

So the Ikeda-related wealth here is virtually untouchable. In Japan, Soka has not only its 8,000-student university but also its enhanced political power. At least 20% of the Liberal Democrat deputies could have lost without the support of Soka followers last October, enough to give the opposition Democratic Party a plurality in the Diet. "It's like becoming addicted to amphetamines," says Katsuei Hirasawa, an LDP member of parliament, of his party's link with Komeito.

In a July op-ed in the Asahi newspaper, Koji Ishimura, a professor of tax law at Hakuho University, argued that Soka's political activities were an abuse of its status as a religion. "The influence of a ruling party that relies on a specific religion's organization to form its power base is growing stronger," wrote Ishimura, who called for Soka's donations to be taxed.

Ikeda established his fundraising prowess early on. According to University of North Carolina professor James White, who wrote a book about Soka, Ikeda threw a scare into the Japanese insurance industry in the 1960s in a crash four-day drive for a key temple at Mount Fuji. Record sums were raised, with some members cashing in life policies to help.

Soka's initial U.S. academic beachhead in rustic Calabasas met with bustle-wary neighbors. After an extended development fight, the 660 acres today may be home to only half a dozen linguistics students destined for jobs as language instructors for Japanese Soka emissaries.

The action shifted to Aliso Viejo in 2001, with promises of a nonsectarian institution with a first-rate library and renowned secular faculty. The new master-planned community was accommodating. Campus athletic and arts attractions, as well as the library, were open to the public. Popular U.S. author Joe McGinniss was a notable instructor hire.

But reality began to kick in when McGinniss and others complained of interference from on high. Several staff have left--McGinniss' contract wasn't renewed--and one sued. Another filed for arbitration and lost.

Earnest university officials are at pains to showcase an arts-and-letters idyll devoted to the betterment of mankind. Soka U insists it is an independent, nonsectarian school not even as religiously influenced as, say, Brigham Young or Notre Dame universities. But at least a majority of Soka U's trustees have direct Soka Gakkai connections. Today 70% of matriculants are Soka Gakkai members.

Some secular faculty felt squeezed. The university was sued in 2002 by Linda Southwell, a fired fine arts professor. Her complaint disputed a "commitment to rigorous academic endeavor, free and open dialogue, and an appreciation for human diversity" when "in reality the curriculum is intended to reflect cult beliefs and perspectives" and speech and association are limited. She also claimed Soka members were favored faculty.

Soka University settled the discrimination and wrongful termination in a "satisfactory" manner that included a confidentiality clause, Southwell's lawyer Brian Glicker says. Another professor, who quit her "frightening" job, begs off discussing the specifics of her beef.

Glicker maintains he's heard from several other non-Soka Gakkai International staff members. "Many or most non-SGI staff or faculty are at least considering leaving," says one disaffected professor. "The university was only able to hire 7 or 8 of the 21 faculty it tried to hire." University officials say they'd not heard this and attribute departures to the growing pains of a new school. They claim an 81% retention rate.

An initial goal of 1,200 students remains a ways off. Has the academic friction been a roadblock? The university says more hiring and building await full accreditation, which it expects soon. On campus, the image is of serenity and strength. The buildings use the same stone featured in the Colosseum in Rome. Ikeda insisted on using it because he intends his university to last 2,000 years, a Soka U spokesman explains. The campus also sports a security camera network rivaling that of any casino.

The university includes a sizable "guest house" and a larger "athenaeum" overlooking a regional park. The sumptuous residence is set aside for VIPs, such as, in the words of one university official, "the president of Venezuela or Daisaku Ikeda." It has ornate furniture, a portrait of Ikeda and many artworks, all covered in white cloth until the VIPs show.

The undergraduate catalog says that "as leaders and decision makers," Soka's graduates "will be guided by the ideal of a contributive life, a humanistic approach drawn from Buddhist thought." But Soka Gakkai newspapers and other publications, filling a prominent shelf in the Soka University library--named for Ikeda--all feature Ikeda's interpretations of Buddhism: To wit, achieve world peace and democracy by becoming one in Soka and chanting. The university notes it also has other Buddhist texts.

Like other students approached at Aliso Viejo, Fabiana Sanchez, 21, a senior and a Soka Gakkai member, says she wants to do something for society or peace. She plans to return to her native Venezuela upon graduation and get involved in some sort of work "linking education and politics."

Soka U denies a rumor that the aging sensei plans a visit soon to his American academic citadel. Succession at the sect's helm is uncertain: Two sons are vice presidents in Soka but the sect denies a hereditary rule. Meanwhile the tax-favored billions continue to roll in, almost entirely outside the purview of authorities anywhere.

Prominent believers in Soka Gakkai include Mariane Pearl, the widow of murdered journalists Daniel Pearl, jazz musician Herbie Hancock and Patrick Duffy of Dallas Tv show fame. Singer Tina Turner was identified with Soka Gakkai in years past, but her spokesman would not confirm an association.

Soka University in Japan trains students for government employment exams and touts their success. Might a presence of followers in the civil service be of more than spiritual use to Soka Gakkai? Consider this case from the files of the Tokyo civil courts.

In 1995 Akiyo Asaki, a politician in the Tokyo suburb of Higashi Murayama, complained vociferously that all city garbage collection contracts were going to Soka Gakkai-affiliated companies.

After receiving death threats, Asaki plunged off a building. When police arrived at the scene, they recognized her and, even though she was still alive, kept her from getting medical help, according to her daughter, Naoko Asaki. She says that when her mother died, the police tried to have her body immediately cremated.

The prosecutor's initial investigator, Masao Nobuta, and the officer in charge of assigning him, Hiroshi Yoshimura, were both members of the sect. They said Asaki's death was a suicide and linked it to her being questioned about the shoplifting of an item of women's clothing.

This explanation, seized on by Soka to counter her family's accusations of murder, became the focal point of a civil court crossfire of defamation cases, several won by Soka. Autopsy evidence, allegedly withheld by police, was presented to show large bruises under her arms, suggesting she had been dragged. Naoko Asaki maintains her mother had left a phone message in a tense, fearful voice before she died. One court ruled inconclusively on a suicide. Soka spokesmen say the religious affiliation of the investigators in the case was a random circumstance and that, in any case, others reviewed their work.

Probes of the death petered out after Soka's Komeito party joined a coalition government in Tokyo. Naoko Asaki is cynical: "Do you think a government that depends on Soka Gakkai is going to investigate?"