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DOCUMENT TITLE: IRS audit of Church of Scientology of California (CSC)
SUBJECT: IRS begins attempted audit on CSC; involves top Guardian Office officials
PARTIES: Meade Emory, Legislation Attorney to Joint Committee on Taxation; Commissioner of IRS; Howard O. Croasmun, Regional Commissioner of IRS, Western Region; Robert Cluberton, IRS agent; Henning Heldt, Vice President CSC, also Deputy Guardian Finance United States; Norton S. Karno, attorney

BACKGROUND AND NOTES

It is the beginning of all that follows: Meade Emory, Legislation Attorney to the Joint Committee on Taxation (who will later be rewarded with an Assistant Commissioner of IRS position, and much more, for his part), conspires with IRS, IRS Commissioner for the Western Region Howard Croasmun, and attorney Norton S. Karno to launch a specious "audit" of the Church of Scientology of California (CSC) that can--and will--result in a later law suit filed by IRS in which co-conspirator Norton S. Karno will have his firm "represent" CSC and the Guardian Office (GO). (This will provide Karno with insider information and documents that he will supply to the government, which will later be used to destroy the GO.) The IRS agent used for the dirty work on the specious "audit" is Robert Cluberton. IRS lackadaisically pursues the phony "audit" for a year and a half. (Later, right after L. Ron Hubbard suddenly disappears in late 1972, and Emory leaves his position with the Joint Committee on taxation, the IRS will put the plan in action by lowering the boom on the GO's Henning Heldt and on CSC with an IRS-issued "administrative summons.")

Here, though, is the record of the beginning of the specious audit, excerpted from the Tax Court ruling in "Commissioner of IRS vs. CSC":



CHURCH OF SCIENTOLOGY OF CALIFORNIA, Petitioner

v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 3352-78.

United States Tax Court

Filed September 24, 1984.

"...For approximately two years from May 1971 through February 1973, IRS Agent Robert Cluberton tried unsuccessfully to audit [CSC]'s 1968 and 1969 tax returns. Part of the audit's lack of success was attributable to the IRS's failure to pursue vigorously the audit and part to [CSC]'s refusal to cooperate. [CSC] never allowed agent Cluberton access to its financial records. ..."



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