Chapter V, quotation (76), footnote 5, thereunder, supra.

OSe
AMORC——Ay FAMILY RACKET— “WITHOUT. PROFIT”
Book withheld from the Bible; The Key to the Art of Concentra- tion and Memorizing, and The Art of Absent Healing.* In addi- tion to the foregoing, they have sold the books of other publishers and many special courses of the ‘““Readers Research Academy” and the “‘Child Culture Institute’, etc., etc., to increase the royal rev- enues of the family hierarchy of the Order.
AMORC Purports to Be a Fraternal Order Operating Under a Lodge System
Aside from the fact that the AMORC is a spurious Rosicrucian organization, fraudulently represented to be the continuation and perpetuation of the original Rosicrucian fraternity, it is supposed to be a fraternal organization with a grand and subordinate lodges and chapters, operating under the authority of a Supreme Grand Lodge, with all members eligible to the higher degrees, bodies, and offices, even unto the highest, upon attaining to the required pro- ficiency and complying with the laws and principles of the organi- zation. It has the appearance of being such, but the surface appearance is wholly deceptive and misleading. In reality the Supreme Grand Lodge is H. Spencer Lewis and his family—the self-styled ‘Hierarchy of AMORC’’—in truth and in fact, it is a mystifying and cunningly designed fraternal swindle of huge pro- portions, of far-reaching effect and attained financial success.
Now it is a universal rule among fraternal organizations that subordinate lodges and chapters organized and operating under charter or authority from the Grand or parent Lodge are self- governing bodies, limited only by the organic law, principles and landmarks of the fraternity, electing their own officers, administer- ing their own affairs, levying dues upon themselves according to the necessities of the case, contributing a small per capita tax to the grand body for its support. It is also the universal custom of real fraternal orders that the officers of the Grand and subordi- nate bodies serve without pay, except certain clerical officers who receive for their services only nominal compensation—not a com- petence and profit—which services are rendered in the spirit of brotherly love and for the good of the order.
4Mr. Ralph M. Lewis testified in 1936 that the sale of his father’s books had amounted to approximately $250,000—Federal Case, Reporter’s Transcript, p. 90.
935
AN ANSWER TO LEWIS" WHITE) BCOKe Ue
Now, it is the contention of Mr. Lewis, as we have seen, that since the State of California granted a corporate charter to him- self and family, he is legally authorized to do what he is doing and conduct a family racket in the name of the Rosicrucians.
The. corporate charter of the Supreme) Grand? Lodgemos AMORC, as amended, provides, among other objects, that one of the purposes of the corporation is: ‘To teach, foster and per- petuate the traditional principles and laws of the Ancient Rosi- crucians.”’
The State of California grants corporate charters and its laws authorize the creation of corporations for legal purposes only. It does not legalize a fraud to incorporate it; nor can a fraudulent scheme be legally carried on under the charter of a membership corporation as a fraternity, to be operated without profit, when the entire membership of the corporation operate it as the sole means of their livelihood and luxurious sustenance at home and abroad.
There is another phase or feature of the incorporation of the Supreme Grand Lodge of AMORC by the Lewis family which strikes at the heart of the legality of the corporation. If a group of persons incorporate a Masonic Grand Lodge without Masonic authority, or a Rosicrucian Supreme Grand Lodge without Rosi- crucian authority, or a Grand Lodge of any secret fraternity or order, without due authorization from such fraternity or order to the persons forming the corporation to exercise its authority and to promulgate its teachings; or, when there is a duly consti- tuted Supreme Grand Lodge or Grand Lodge of such fraternity or order operating within the territory wherein the forming or incor- porating Grand Lodge proposes to operate; then, under such a state of facts, the securing of a charter for such a corporation is illegal. It was secured by deception and is a fraud against the State, as well as against the people of the State of its domicile, and also against the people of several States of the United States wherein it operates. Such a corporation, having the apparent status of a legal entity, is all the more dangerous and vicious be- cause it hides its viciousness beneath a cloak of apparent legality and the official sanction of the fundamental law it contravenes and the sovereignty that it violates and abuses.”
5 There is another fraudulent aspect of the incorporation of the Supreme Grand
936
AMORC—A FAMILY RACKET— “WITHOUT PROFIT”
Huge Sums A ppropriated
Under his self-fashioned charge ‘““Number Eleven’, quoted supra, he ridicules the idea that the AMORC is a “profit-making racket with huge sums of money being appropriated by Imperator Lewis and his family.”
We have seen that since 1928 the AMORC has been under the sole control of “Imperator Lewis and his family’; that by the means and methods herein described they have built it into a Million Dollar concern, with property and cash accumulated since 1928 amounting almost to a Million Dollars, and with a gross income in some years exceeding a Million Dollars. Certainly they have appropriated huge sums!
But let us see how and in what manner they have appropriated these funds and for what purposes they have been used. They have appropriated almost a half a Million Dollars to build “The Institution Behind the Advertisement’’—behind the orders for merchandise and behind the paying membership—which institution, all of its property and funds, now belongs entirely to the hierarchy or the Lewis family, and that may ultimately inure to their sole benefit and become their individual property, as we shall later show. They spend a tremendous sum in sending out six million pieces of propaganda literature each year, with a printing bill of from sixty to seventy-two thousand dollars, and with postage alone amount- ing to from fifty to sixty thousand dollars per annum.® They ex- pended fifteen thousand dollars in the George L. Smith case, as we have seen in Chapter I, supra, to prevent the truth concerning their
Lodge of AMORC by Lewis and his family in 1928 not considered in the text which should be interesting to ofhcial investigators and especially to the officials of the State of California. Said Supreme Grand Lodge, before its incorporation, was a voluntary association composed of an unlimited membership. See Article Three, Section 3, of Constitution of 1917, quoted supra. Which Constitution was in effect in 1928 when the incorporation took place. As is the law in practically every State in the Union, the Civil Code of California, Title XII, Section 594, provides that no voluntary or unincorporated association may be incorporated except with the consent of a majority of the members of such unincorporated association. Now, it appears from the testimony of the Lewises in the Federal Case that when they incorporated the Supreme Grand Lodge in 1928 as a family affair, they did so without the consent of the members of the unincorporated association. See Reporter's Transcript. This fact is also shown by the original incorporation papers filed with the Secretary of State of California.
6H. Spencer Lewis so testified in the Federal Case. See Reporter's Transcript, pp. 137 and 215, and testimony of Ralph M. Lewis, Id., pp. 72, 96 and 97.
OSL:
AN ANSWER®* TO-(LEWIS” WHITE?) BOCK ve
family racket being proven in court, under the subterfuge of set- tling another case." They have spent many thousands of dollars in defending their supremacy of the control of the family racket and in defense of their fraternal racket against the complaints and suits of outraged and defrauded members.* In various ways and by the employment of many cunning artifices, they use the funds of this so-called non-profitmaking corporation to gratify their de- sires for self-complacency and ostentatious pomp, to promote them- selves, and to create a halo of false greatness and assumed spir- ituality about themselves that they may better retain control of and perpetuate their fraternal racket. Under one pretext or an- other and under the flimsy disguise that they were attending to the affairs of the order, they have traveled all over this broad land at the expense of the corporation. For years they have been mak- ing numefous periodical trips to Europe to attend meetings of their fake International Council and R. C. World Congresses.* Under this sham and fraudulent artifice they have alternately taken their families abroad on luxurious pleasure trips and glorious va- cations. When the senior goes, the family goes with him and the junior stays home and runs the hierarchial business of the family. Then junior goes and takes the family and the father attends to business at home.t They alone determine the necessity (?) or make the pretext for such trips, they spend and enjoy as they will, and they alone determine the reasonableness of their expenditures and approve their own bills.
They have appropriated to themselves as trustees, to spend as they see fit, two huge funds of $69,600 each, one to fabricate and. maintain so-called ‘‘Rose Croix Universities” abroad and the other to the account of the “International Council’, now aggregated at probably more than $140,000, for promotional and private pur- poses, and to maintain such fake contrivances in Europe as devices
7 See Federal Case—Reporter’s Transcript, pp. 72 to 75.
8 See The Rosicrucian Digest, March, 1937, p. 48, where a part of such expenditures are accounted for and acknowledged.
® In Chapters IV and V, supra, we have demonstrated that their International Coun- cil is a mere device of fraud; that they have attended no Rosicrucian Congresses.
1The proof of this statement is to be found in the announcements and reports of their trips as published in their official organs. For a concrete example, see Chapter IV, pp. 467 to 502, supra.
938
AMORC—A FAMILY RACKET— “WITHOUT PROFIT”
of fraud to promote and perpetuate a fraternal swindle in America.’
Appropriate for Their Use as They See Fit
They have fixed their own salaries and pay to themselves the following salaries per annum: to H. Spencer Lewis, the Imperator of the Hierarchy of the Order and the president of the Board of Directors, $9,000; to Ralph M. Lewis, the Supreme Secretary of “the Order’’ and secretary of the Board of Directors, $4,800, and to Clement Le Brun,’ Sovereign Grand Master of the Grand Lodge of “the Brotherhood” and member of the Board of Directors, ap- pointed by the Lewis hierarchy to do. their bidding, $2,860.* “They built their homes with the funds of this non-profit sharing cor- poration, and when H. Spencer Lewis had overdrawn his account to the extent of $6,000 they wiped the overdraft off and forgave the debt by the exercise of their hierarchial power and by virtue of the family’s control of the corporation. Then, in order to get other funds of this fraternal, non-profit corporation into the family ex- chequer, they purchased from H. Spencer Lewis the copyrights on the books he had written for “the Order” at $10,000 and paid him $10,000 therefor, notwithstanding that he had been drawing a salary from “‘the order” when he wrote and copyrighted said books for the order to market to the members of the brotherhood.°
Then after having appropriated these huge sums they adopted the Constitution of 1934 giving unto themselves the sole discre- tion, without limitation, to expend and appropriate the funds as they see fit, the authority to build homes for themselves, to travel and pay their traveling expenses and to fix and pay their own salaries.®
Yes, they have appropriated huge sums—and there is no limita-
2 See Chapter IV, Part Four, pp. 417 to 422, supra, for a discussion of this matter and the testimony of the Lewises in connection therewith. Wherever we have referred to the Lewises or used the personal pronoun “they” meaning the Lewises, we have referred to Harve Spencer Lewis and his son, Ralph Maxwell Lewis.
3 Now deceased. Succeeded by Mr. Thor Kiimalehto.
+See testimony of Ralph M. Lewis, Federal Case, Reporter's Transcript, pp. 49, 76 Banal Wile
5 See testimony of Ralph M. Lewis, Federal Case, Reporter's Transcript, pp. 49, 51, 52 and 53.
6 See Constitution of 1934, Article X, Sections 30A and 30B, quoted in part, supra.
939
AN ANSWER: TO LEWIS "WHITES? sbOOKe ps
tion upon their powers to appropriate such sums as they please for their own use, benefit and advantage, with the possibility that all of the property and funds of said corporation may inure to their personal benefit and absolute ownership.
On Dissolution of Supreme Grand Lodge Its Assets Become the Property of Its Members
Assuming for the presentation and consideration of this case that the Supreme Grand Lodge of AMORC is duly and legally incorporated and that the Lewis family and another member em- ployed and discharged by them are the sole and only members thereof, we find that it is incorporated and functioning under TITLE XII of the Civil Code of California, of which Section 593 thereof
provides:
“FORMATION AND PURPOSES. A non-profit corporation may be formed by any number of persons, not less than three, for any lawful purposes such as religious, charitable, social, educational, recreational, cemetery or for rendering services which do not con- template the distribution of gains, profits or dividends to the mem- bers thereof, and for which individuals Jawfully may associate them- selves, subject to laws and regulations applicable to particular classes of non-profit corporations or lines of activity. The carrying on of business at a profit incidental to the main purposes of the corpora- tion and the distribution of assets to members on dissolution shall not be deemed forbidden to non-profit corporations. (Added by Stats. 1931, p. 1847.)” (Italics are ours.) |