A History of the Unification Church in Canada: 1965-1991
by Franco Famularo
Chapter Six - The Werner Years [Part 3]
New Leadership -- Outreach Activities -- Financial Activities -- Peripheral Activities—Initial Stages of Decentralization
C. Financial Activities
Undoubtedly, funds were necessary for the continued survival and development of the church. A long list of "needs" such as; the printing and distribution of literature, maintenance and upkeep of buildings and vehicles, the support of missionaries, travel expenses, the sponsoring of meetings, conferences, and food distribution projects, to mention a few, all required a constant inflow of funds. Furthermore, as mentioned previously, the Porter era produced a series of real estate acquisitions which were by no means purchased outright. The properties were all heavily mortgaged and the accumulated liabilities of the church at the end of 1983 were close to one million dollars.59 This was also a period of high interest rates and to service the debt required steady income. The church's main source of income was through fund-raising. Through consistent effort at raising funds and through the selling of certain assets, liabilities were reduced to about two hundred thousand dollars by the end of 1988.60
Paul, wanted to substantially reduce the debt load of the church. It is not clear whether he foresaw all factors involved, but in hindsight it appears the church stood to lose a number of its assets if they had not been paid during the mid-1980s as they were. One reason was that it was evident the existing church structure would not last for very long. Members were getting older and were increasingly faced with responsibilities that diverted their energies from full-time missionary outreach activities or from full-time fund-raising for the church. Furthermore, the absence of significant full-time membership growth, meant that the existing church structure was changing rapidly. A substantial number of Canadian members participated in the mass weddings of July and October 1982. Although most did not begin married life till after 1985, by the mid-to-late 1980s most members of the church in Canada were faced with the challenges of family life.61 For these and several other reasons, there was an increase in fund-raising activities. The issue of how much time was spent fund-raising later became a bone of contention for both members within the church and for a number of outsiders, which included the Department of Revenue of the Government of Canada.
When Paul Werner arrived in September 1983, there existed two mobile fund-raising teams (MFT) in Canada, which supplied most of the funds for the church. Members in other centers also fund-raised to maintain their own centers and to further support, what were considered, national projects. The national projects were for example, national speaking tours and the servicing of the debt on "national" properties. A good example of the centralization of the church was the mobilization of members to raise funds during Paul Werner's time in Canada.
In September 1983 the MFT was reorganized along male/female lines and thus the existence of a "brother's" and a "sisters" team. By the end of 1983, Denis Desjardins, who had been the main central figure for the MFT in Canada during the Porter period, no longer had that responsibility. The teams, which consisted of ten members each (sometimes more or less), were led by Barbara Christie-Peat and Nic Farrow. Later, Lynn Dutertre also led one of the teams. The teams raised funds throughout Canada, but mostly in Ontario, Quebec, New Brunswick and Nova Scotia. Indeed the same cities and towns were visited between two and three times a year.
Through visiting the MFT regularly, Paul was able to motivate the members to consistently raise funds. Results increased and all records were broken. Paul generally visited the MFT teams two or three times a month and since the MFT was always on the road, he often found himself traveling throughout Canada to meet them. He usually traveled by car and always together with his wife and assistant, Carolyn Bing Wo. The visits always featured a session, several hours long, where members of the MFT would ask questions of a spiritual nature and Paul would provide explanations to their many queries. Constant visitation brought a sense of expectation. For those that did well, the meetings were often an enriching time, a break from the daily grind of raising funds. For those that did not do well, it was a time of confrontation and sometimes fear. In any case, results on the MFT consistently seemed to increase shortly after a visit.62
For Unificationists MFT was viewed primarily as spiritual training and secondarily as a means of raising money. A church publication described fundraising as follows:
Fundraising, however, is not just an economically necessary activity. Approached with the proper attitude, it provides an education in practicing the principles of Unificationism. It involves a rich variety of experiences. For example, fund-raisers learn constancy through literally hundreds of encounters with people throughout each day, some of them immensely uplifting and others just as depressing. They can gain familiarity and sympathy with all styles of ... life - from wealthy suburbs to inner-city slums, from corporate offices to grimy garages. ... Thus, through fundraising members learn how to feel gratitude for even the smallest act of kindness, forgive and love those who belittle or persecute them, and develop the habit of communing with God and Christ in every moment. This practice has its precedent among the holy men and women of history...63
Furthermore, according to Unification Theology, because human beings deviated from God, restoration required a course reversing the process by which humans lost their relationship to God. Without going into much detail, to do so requires, firstly, the symbolic restoration of the material world and then the symbolic restoration of people. Fund-raising, according to Unification teaching, symbolically restores the material world. By raising money and not using it for one's own purpose or personal gain, but rather offering the funds to be used for a Godly purpose, the symbolic restoration of the material world comes about. Witnessing, on the other hand restores people symbolically. Through finding people who respond to God's call, the symbolic restoration of humanity comes about.64 This was, according to Unificationism, the "formula course", and it is with this view that Unificationists participated in fund-raising activities.
According to the "formula course" members should have spent three and one half years on MFT and three and one half years in full-time witnessing or outreach activities. Due to a lack of membership growth this could not realistically take place. Some members such as Richard Fortin, Gabriel Tuzet, Michal Trusilo, Suzanne Claveau, Robert Lean and others, continued fund-raising for five years and longer. Although some did it gladly, others did not. Nevertheless, each year the revenues of the church grew.
Not only did the MFT raise funds, but throughout the 1983-1988 period regular fundraising conditions were instituted for the entire membership. The most intensive fund-raising was done during the two months before Christmas, as 40-day fund-raising conditions began in early November. Members raised funds every day except Sundays, which were reserved for service and internal meetings. During the 1980s members raised funds primarily by offering pictures, clip-on toys, candies, and puppets in exchange for donations. Furthermore, there were several fundraising drives that the majority of the Canadian membership participated in. For example, through the summer of 1984 and for three months during the summer of 1985 major drives to raise money were instituted.65 This was in addition to two days of fund-raising each week, usually on a Thursday and Friday. In spring 1986 members throughout the country raised funds for three hours each morning; the goal was seventy-five dollars. If accomplished members did outreach activities for the remainder of the day. If not they continued until they reached the goal. Other fund-raising drives took place in 1987 and 1988.
Paul managed the activity himself. Although he deputized the implementation of details, he was in close touch with all aspects through an effective reporting system. In Toronto, for example, he often gave pep talks over breakfast and as members departed the center at 8:00 a.m., usually to the sound of a German Brass Band on the stereo, he would bid everyone farewell. In the evening, once the members returned home after 9:30 p.m. Paul would again speak with the members till late into the evening. It was undeniably, as Paul often said, "a tight ship."66 Although initially most members greeted this approach positively, some came to resent the tight discipline as time went on.
In an effort to uncover the extent of fund-raising activities, Mike Brosgall, a representative of Revenue Canada then involved in an extensive audit of the church in 1987, commented as follows in a report to his superiors:
Membership of the church has been fairly steady for the past three years. Whilst it is imperative that the fund-raising activity of the members is constant, some members do no fundraising whatsoever. However, approximately 80% of the members are engaged in fundraising, year round, to some degree... Frequency of fund-raising activity [is] constant, they must fund-raise to survive... The Holy Spirit Association has no funds given to it by Government or Corporations. It has to provide for itself or close.67
In any case, whether fundraising was disproportionate or not, revenue through fundraising increased from approximately seven-hundred-fifty thousand dollars in 1982, to one million one hundred thousand dollars in 1984 and by 1987 fund-raising income reached its peak at approximately one million seven hundred thousand dollars. (These are gross income figures and do not include expenses incurred). In 1987 one property was sold and several mortgages were paid off in full, thus easing the financial burden.68 Due to steady fundraising drives there was never a shortage of funds to engage in various outreach activities, the purchase of new equipment and the like. A steady supply of funds was also required for legal and accounting fees which escalated considerably during the mid-1980s due to an unforeseen circumstance.
2. Investigation by Revenue Canada
In the summer of 1987, the Unification Church in Canada was extensively audited by Revenue Canada due to the earlier loss of its charitable status. This event took everyone by surprise and also cost the church substantially in terms of time and money over a six year period. The church lost its charitable status essentially because one piece of paper was not filed properly in 1979.
The church in Canada, as mentioned, was and still is officially known as, "Holy Spirit Association for the Unification of World Christianity"(HSA-UWC). It was originally registered as a charity in 1969 and incorporated by Letters Patent in 1973. When the church headquarters was moved from 80 Admiral Rd. to 87 Bellevue Avenue in 1979, a change of address form was not filed with the Ministry of Consumer and Commercial Relations. In 1982, the Ministry requested information from each non-profit corporation in Ontario, but the notice from the Ministry was not received by the church since it was sent to the old address. Since there was no response from the church, the Ministry canceled HSA-UWC's Letters Patent effective September 8, 1982.
In July 1985, Maureen Kathan, then the church's in-house accountant, went to register a mortgage. When the mortgage company did a title search they discovered that HSA-UWC did not exist. Efforts were made to remedy the situation, which could have been easily taken care through the passage of a Private Bill by a Member of Provincial Parliament (MPP).69 The church could not find one MPP to sponsor such a Bill and thus was required to incorporate anew and re-apply for charitable status in 1986. All assets of the church were thus in "limbo."
Normally an application for charitable status would be received, reviewed and delivered back to the applicant within a matter of months. But, this was the Unification Church founded by Rev. Moon and it was not 1969 or 1973 when the church was an obscure organization. This was 1986, and Revenue Canada responded by requesting extensive information about the teachings, practices and financial activities of the church and the church's response, in the view of Revenue Canada, was not sufficient. A representative of Revenue Canada wrote:
... we have completed our review of all the information provided to date and must regrettably advise that, in our view, the corporation's present mode of operation prevents it from being registered as a charity under the Income Tax Act.70
The bone of contention was that the church's fund-raising activities were not viewed as related to the objects of the charity.
In August 1987, Revenue Canada began, what was called, a pre-registration audit of the church. Mike Brosgall, then auditor for Revenue Canada, visited the church center and met regularly with Maureen Kathan and Franco Famularo. Through a series of meetings that continued till November 1987, every aspect of the church was looked at such as; its teachings, inner organization, membership qualifications, and finances. In short, it was an exhaustive inquiry.
One principal issue was whether the Unification Church qualified as a religion or not. Furthermore, if it was a religion, a concern of the auditor was that a disproportionate amount of time was spent raising funds. Another area was with regard to possible illegal financial dealings of the church. The auditor was well aware of all the negative publicity and often used negative media reports as a basis for further questioning. For example, an allegation often made by the opponents of the church and reported to the media was that members were required to turn over all their worldly possessions. In his report Mike Brosgall wrote:
There has been no transfer of worldly possessions by a member to the church in Canada. Quite the contrary takes place in that new members retain their bank accounts and use their funds for such things as ...71
In spite of the extensive investigation, the auditor found nothing that was in disorder, owing very much to the fact that the church kept good records.
But despite a favorable audit report, charitable status was not granted until August 1991. The process was lengthy and detailed and those representing the Revenue Department appeared to be, in the view of Unificationists, "dragging their feet." To Canadian Unificationists, regularly involved with the process, it seemed that no one at the Revenue Department wished to sign on the dotted line. This was perceived to be so, because the HSA-UWC file was reviewed by several different representatives, due to transfers and other reasons, until charitable was granted.
An example of what appeared to be unnecessary prolongation of the process was that the Department of Revenue repeatedly asked for increasingly detailed descriptions of how the members used each minute of their time. Schedules had to be produced which enumerated exactly how much time was used for fundraising, witnessing, cooking, and other activities. It seemed excessively intrusive. Still, a September 1988 letter from the Revenue department stated:
... the Department's principal concern regarding the Association's application for registration as a charity is whether in light of its overall emphasis on fund-raising, it can be considered to be devoting all of its resources to charitable activities.72
The church expended much energy and financial resources to re-acquire its charitable status and after many long meetings, long letters and divulging extensive details of the church's mode of operation in Canada, charitable status was granted on August 20, 1991 retroactive to the beginning of the 1991 fiscal year.73 It had been more than six years since the process began. At issue for the Revenue Department was also the deer breeding operation and other businesses that were considered unrelated.
3. Other Business
There was a constant concern to develop alternate sources of income, but other than the deer farm, none really took root. Numerous areas were explored as everything from starting video rental and dry cleaning outlets to photocopy and printing shops were researched, not to mention fishing, food services and various retail sales possibilities. It was an unfortunate situation for members of the Canadian church that none of these ventures ever materialized.
While the deer breeding operation was originally set up to provide an alternative source of income for the church, it operated at financial loss for most of the 1980s.74 During most of the 1980s Steve Barton was responsible for the farm operation, but, of course, final decisions were made by Paul Werner. Whereas, Martin Porter was fully involved with the entire process and, as mentioned earlier, was becoming somewhat of an expert in deer breeding, Paul did not share the same level of interest. As one member put it, "the deer breeding operation was Martin Porter's baby."75 Paul's focus was elsewhere. Nonetheless, a number of other farm related business projects were initiated in the area of fur bearing animals. This latter development would prove to be financially disastrous.
In 1984, a chinchilla breeding operation was initiated, this was followed by mink, fox, and sable farming in 1987. In retrospect it was one of the worst times to enter the market and by 1991 all four fur bearing animal operations had been discontinued at a loss of several hundred thousand dollars. The deer breeding farm, however, continued to grow, although its growth was hindered by the fact that it had to absorb the losses incurred by the experiment in raising fur bearing animals.
During the audit by Revenue Canada and in the years till the church was granted its charitable in 1991, a requirement set by the government was the legal separation of the farm from the church. The farm, it was determined by the Revenue Department, was an unrelated business activity. Thus, it was recommended that the church sell the business at fair market value. Through a complex arrangement, designed by legal counsel and agreed to by Revenue Canada, the church complied and the farm was "sold" to a group of five senior Canadian Unification Church members in 1991. In short, since the members did not have the financial resources to pay, the church held a mortgage for the total value of the farm operation, which was then appraised at approximately one- million-six-hundred-thousand dollars. The farm operation was required to pay the church back, with interest, over an indefinite period of time.76 In this manner church members continued to develop the deer breeding operation. By the early 1990s it expanded the operation into the province of Quebec as well.
There were several other attempts at business development during Paul's time in Canada, but none of these survived. One of these was Saeilo Inc, which was to be a distributor of lathes produced by a church related company in Korea called Tongil Machinery. Robert Duffy returned from Ireland at Rev. Moon's request in 1983, to develop this enterprise; but by mid-1984, due to changing priorities, it was discontinued. An attempt to revive Saeilo took place in 1987, but to no avail.
Other ventures were a printing business, which was initiated in 1987, but discontinued several months later and lastly there was Palace Trading Inc. Incorporated in 1988, Palace Trading was set up to engage in import/export and other trading activities. Initially, Palace Trading raised money through door to door sales similar to the MFT, but did so as a private business and not as a charity. For the latter half of 1988, several members led by Lynn Dutertre and later by Wes Ramage engaged in direct selling throughout Toronto, but with the advent of new leadership in 1989 new avenues were explored through the setting up of kiosks in shopping centers. Remnants of this enterprise continued into the 1990s. In sum, Unification business activities did not flourish in terms of profitability during the 1980s. The lack of successful business ventures had a detrimental effect on the development of the church and also led to later decentralization.
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