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Sun Myung Moon tax fraud and conspiracy case

In 1982, Sun Myung Moon, the founder and leader of the Unification Church, was imprisoned in the United States after being found guilty by a jury of willfully filing false Federal income tax returns and conspiracy. Church members and supporters decried the prosecution as politically motivated, saying that the government made a federal case out of a small matter.

Background

Upon arriving in the United States, Moon had established an account at Chase Manhattan Bank with approximately $1 million on deposit. Some of this money went to support his family, and was recorded as salary on his personal income tax returns. The remaining funds were transferred to the Unification Church upon its incorporation. Moon did not take a deduction for donating the hundreds of thousands of dollars remaining in the Chase account. Justice Department investigators considered this a sign that Moon and his church both clearly considered the money to have been church property all the time. They note that he would have saved considerable money if he had taken a deduction.

IRS investigation

After personnel from the Internal Revenue Service (IRS) spent two years poring over all the church's financial records, three United States Department of Justice officials independently concluded that there was no wrongdoing. Moreover, they emphasized that the amount of possible tax liability was too small (less than $7,500 per year over a three-year period) to merit prosecution.

Federal prosecution

In 1982, Moon was charged with three counts of willfully filing false Federal income tax returns (for the years 1973, 1974, and 1975) under , and one count of conspiracy -- under -- to file false income tax returns, to obstruct justice, to make false statements to government officials, and to make false statements to a grand jury.

The prosecutors charged that Moon failed to declare as income (and pay taxes on) $112,000 in earned interest in a Chase Manhattan bank account, and on the receipt of $50,000 of corporate stock.

The essence of the prosecution's case was that both the money and stock were his personal property. The church maintains that these were rather being held on behalf of the church by Rev. Moon. Indeed, Rev. Moon transferred the bulk of the Chase account funds to the fledgling church upon its incorporation. He did not declare this transfer as a deduction on his income tax.

One of the defenses used at trial was that the funds were not really his, but were held in trust for members of the Japanese Unification Church. The United States church had only about 300 members at the time and had not yet incorporated. Moon's lawyer argued that, after using a small portion of those funds for his family's living expenses (and declaring the portion used on his income tax returns), Moon transferred the balance to the Unification Church of America after its incorporation. Holding church funds in a minister's name is a fairly commonplace action, particularly in small churches, and some church-related or other organizations filed amicus curiae briefs in the case.

There was quite a bit of sentiment against Moon and his church in the United States at that time. Moon and his supporters felt that they were being specifically targeted because of their religious beliefs and practices.

The court denied Moon's request to have a bench trial. On appeal the United States Court of Appeals for the Second Circuit noted that Moon had argued that "insistence on a jury trial had the effect of punishing Moon for exercising his First Amendment right of free speech [in connection with some statements Moon had made that, it was feared, would prejudice a jury]. The punishment, so the argument runs, took the form of denying Moon a benefit, i.e., a nonjury trial, that he would otherwise have been entitled to."

The Court of Appeals rejected this argument, stating: "The right to trial by jury is a benefit granted an accused... which a defendant has the power to waive.... The ability to waive the benefit does not import a right to claim its opposite." The Court noted that Rule 23(a) of the Federal Rules of Criminal Procedure "does not require that the Government articulate its reasons for demanding a jury trial at the time it refuses to consent to a defendant's proffered waiver [of a jury trial].

Sentence

Moon was represented in the appeal by Laurence Tribe, one of the foremost constitutional law experts and Supreme Court practitioners in the nation. Moon was convicted on all counts in 1982, and the convictions were upheld on appeal. He was given an 18-month sentence and a $15,000 fine. He served 13 months of the sentence at the Federal Correctional Institution, Danbury and because of good behavior was released to a halfway house before returning home. While serving his sentence he worked in the prison kitchen.

Viewpoints

Kenneth Briggs, former religion editor of the New York Times, wrote:

Later, the group's founder, the Rev. Sun-Myung Moon, was jailed on questionable allegations, and he took his punishment in a Connecticut prison with exemplary forbearance.

Ed Farmer, a fellow inmate, said:

The Rev. Moon has a very good sense of humor. It's hard for me to think of a person as being mean or brainwashing people with the sense of humor he has. He truly loves people. I mean, he likes being with them. He likes being kidded-he likes being teased. I never saw a mean act on his part. He never asked for special treatment. He mopped floors and cleaned tables, and he helped other people when he was finished with his job.

While Moon was in prison, Unification Church members launched a public-relations campaign. Booklets, letters and videotapes were mailed to approximately 300,000 Christian leaders in the United States. Many signed petitions protesting the government's case. Among the American Christian leaders who spoke out in defense of Moon were conservative Jerry Falwell, head of Moral Majority, and liberal Joseph Lowery, head of the Southern Christian Leadership Conference.

Supporters regard the tax case as politically motivated. The prosecutors offered to drop the case in return that Moon surrendered his green card, which he chose not to do. The official website of the American Unification Church, unification.org, says:

When the indictment was handed down, Reverend Moon was in Korea. His lawyers recommended that he not come back to America, since there is no extradition treaty between the United States and the Republic of Korea. However, he did not follow their advice. He was, after all, a man of God, not a criminal fleeing the law. He immediately returned to the United States. He told his counsel: "I will not abandon my mission in America. That I will never do."

A United States Senate subcommittee, chaired by Senator Orrin Hatch, conducted its own investigation into Reverend Moon's tax case and published its findings in a report which concluded:

We accused a newcomer to our shores of criminal and intentional wrongdoing for conduct commonly engaged in by a large percentage of our own religious leaders, namely, the holding of church funds in bank accounts in their own names. Catholic priests do it. Baptist ministers do it, and so did Sun Myung Moon.

No matter how we view it, it remains a fact that we charged a non-English-speaking alien with criminal tax evasion on the first tax returns he filed in this country. It appears that we didn't give him a fair chance to understand our laws. We didn't seek a civil penalty as an initial means of redress. We didn't give him the benefit of any doubt. Rather, we took a novel theory of tax liability of less than $10,000 and turned it into a guilty verdict and eighteen months in a federal prison.

I do feel strongly, after my subcommittee has carefully and objectively reviewed this case from both sides, that injustice rather than justice has been served. The Moon case sends a strong signal that if one's views are unpopular enough, this country will find a way not to tolerate, but to convict. I don't believe that you or I or anyone else, no matter how innocent, could realistically prevail against the combined forces of our Justice Department and judicial branch in a case such as Reverend Moon's.

Jeremiah S. Gutman, president of the New York Civil Liberties Union, called the prosecution "an indefensible intrusion in private religious affairs." The New York Times and the Washington Post, which had both been critical of Moon, expressed concern about the government's prosecution of him, and the consequences it might have for other religious groups.

Afterwards

Michael Tori, a professor at Marist College (Poughkeepsie, New York) suggested that Moon's conviction helped the Unification Church gain more acceptance in mainstream American society, since it showed that he was financially accountable to the government and the public.

Under the Schengen Treaty the Reverend Moon and his wife were banned from traveling to some European countries including the United Kingdom, France and Germany on the grounds that they are leaders of a sect that endangers the personal and social development of young people In November 2005, during a visit in 13 European Countries - part of a 100 City World Tour ending in December 2005 - to deliver a keynote address at the inauguration of the Universal Peace Federation, Sun Myung Moon and his wife were allowed to enter The Netherlands and Denmark. In 2006 the German Supreme Court overturned the ban.

Pulitzer-prize winning reporter Carlton Sherwood wrote a book in Sun Myung Moon's defense (Inquisition: The Persecution and Prosecution of the Reverend Sun Myung Moon).

References

See also

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