The Words of the Hyun Jin Moon

Report on the AFUPM ICU in Brazil (Part 2)

Hyun Jin Moon
July 12, 2010

Google translation from Spanish of: -- Translation may be inaccurate

This is the second part of the previous report. It is longer than the first report, but if someone wants to talk about these issues should clearly understand the context before saying a word. Therefore, we recommend that you read this report coming from UCI [Unification Church International] on the situation of Brazil.

UCI report on the victory of the case related to the farms in Brazil
Victory through arbitration against unethical lawyer Antonio Augusto

Focused on the vision and the foundation established by the True Parents, and through the strong commitment of all Blessed Central Families in the world, the project Nueva Esperanza (New Hope) since it began in 1995 has had many achievements angels and gave new hope members. However, due to poor management of the properties and the lack of understanding of the law and the Brazilian culture by the Korean leaders who were in charge, many problems occurred and are threatening the very existence of the Association (AFUPM [FFUWP Brazil]). Among all the problems this report focuses on a situation, which has been one of the most difficult to solve since it involves the most immoral lawyer, Antonio Augusto de Souza, the victory in the arbitration case against him and to address outstanding issues .

Importance of the Victory of Arbitration: The recovery of the estates of the association in Brazil

The final decision of an arbitration of almost two years, relating to the right of ownership of the estates of the Association against Antonio was unveiled on July 7, 2010 in Sao Paulo, Brazil. This is a great victory because through the arbitration decision, UCI was able to solve one of the most difficult problems related to the estates of the Association in Brazil. This is a remarkable achievement, since we can recover all the lands Antonio attempted to steal, they are in total almost half of the total land area of the Association in Brazil.

me highlights of the decision are:

1) The agreement reached between the Association and Antonio was not a power of attorney-cancelable not with Antonio, but a partnership agreement.

2) Although the agreement is valid, there was a mutual violation of the contract: Antonio did not act in good faith by the non-payment of proceeds from the sale and the lack of care expected in the sale of the property; The Association violated the contract to provide the land subject to this agreement as a guarantee to a third party.

3) Therefore, the mutual violation of the contract means the restoration of both sides to the situation prior to the contract, in other words means the sale of land in violation of the contract is invalid and has no effect, even to third parties.

Arbitration Proceedings and process

Arbitration, a form of alternative dispute resolution is a legal technique for resolving disputes out of court, where parties in dispute shall be referred to a panel of three arbitrators, whose decision shall undertake to respect and can not be appealed . Both sides presented their opening statements in 2008. During a hearing before the panel of arbitrators in Sao Paulo in February 2009, both sides presented evidence and arguments on the validity of a contract for the land of the Association and its responsibilities. Both sides presented their closing statements at the end of 2009 and the arbitration panel issued its final decision after a thorough review in April 2010 and published on July 7, 2010.

History Project New Hope (Jardim)

On the 36th True Parents Day on 1 March 1995 (lunar calendar), the True Parents announced the "Proclamation of Sao Paulo" in which it declared the beginning of the second course of 40 years, a period in which all members of the world inherit the victorious foundation of True Parents and children take responsibility. As a concrete and practical plan for the proclamation just mentioned, Father issued the "Proclamation of the Hacienda Nueva Esperanza (New Hope Farm)" on April 3, 1995 at 5 am in front of leaders representing 160 nations world, the Hacienda Nueva Esperanza in Brazil that might become the model of an ideal society and the nation ideal.

The New Hope Project (Jardim) in Brazil that was launched in 1995, focused on this vision of the True Parents, has progressed through many ups and downs in the last 15 years. The project was initiated and was operated under the leadership of President Kim Sang Yoon.

Most rural land in Brazil was purchased during this period on behalf of the Brazilian Association of Families (AFUPM). Following the direction of True Father, President Kim bought much land as much as possible. However, the process of buying these properties was disorganized, resulting in several problems. These problems include:

1. Vendors took advantage, selling land at prices above the market value

2. Purchase and payment to vendors who were not legal owners of the property,

3. Lack of records of goods purchased.

Even today, there are still several properties in which the title of the property acquired has not been properly transferred and recorded. Through this process, a total of more than 50 lots of farms with a total size of over 90,000 hectares (approximately 222,300 acres) were acquired for approximately 35 million Brazilian Reals (approximately USD 19.9 million).

The story of stealing from the estates of the Association for Antonio

On September 21, 2000, the Brazilian government announced the creation of the National Park Serra da Bodoquena (National Park) with an area of 77,232 hectares (approximately 190,800 acres) and notified the Association of Families to be included several farms (both general and partial) of the Association in the expropriation of land for the park. The farms affected by this announcement are the 10 with a combined total area of approximately 24,000 hectares (approximately 59,300 acres).

In 2003, the first fine was issued by the ITR (imposed on rural land ownership in Brazil) due to failure to provide certain registration documents, mainly the analysis of geo-referenced using satellite coordinates, and the declaration of areas and legal permanent preservation of the properties. Initially Jardim project leaders did not understand the reason for these high taxes and did not respond. Only after receiving several citations was that they began to have discussions in meetings with various groups in Jardim in relation to the cause of these events. Even after we understood the reason why they had to pay taxes, it was decided that because the Association had no resources to pay for analysis of geographic reference, or the tax, which is simply not going to pay. No formal response was issued to the tax authorities in connection with the ITR and the subsequent statements were simply ignored.

For 2006, tax authorities had extended its review in August haciendas and penalties plus interest exceeded Brazilian Reals 25 million (approximately U.S. $ 14.2 million). Taxes and fines are significantly increased if a property is not used properly and the tax authorities determined that these estates were not being productive. The tax authority of the Association gave a grace period of one year to resolve this issue and presenting the appropriate geographic reference analysis and other documents, after which the penalties and interest would be reduced.

It was during this period of turbulence and confusion due to matters relating to the National Park and ITR that Antonio was first introduced to Joao Urias (Jardim project director at the time) by Ferabolli Simao (President of the Association at that time and this) and Luiz Edivaldo Francischinelli to resolve these issues, along with other outstanding issues. Edivaldo had relations with the Association, but later was seen as a business partner Antonio.

Antonio Joao submitted a proposal to the November 14, 2006 with the following points:

Representation of the Association for suing the Government and obtain payment for expropriated land

The payment would be 10% of the value obtained from the Government recovered

Joao signed the bill, but he told Antonio that his firm alone would not be binding, and that the proposal would have to be ratified by the President of the Association in Sao Paulo. But no other decision was made on the proposal at that time.

Between November 2006 and January 2007, several farms were leased to Antonio and Edivaldo at very low prices. The rationale behind these leases was that cheap because the estates purchased by the Association were in a state idle and unproductive, and therefore were receiving strong sanctions by the government, these two individuals would make it a favor to the Association to lease land and do something productive with them. Leased properties include Figueira, Taboquinhas, curve, and the estates of Rio Branco. More than 2,000 cows and more than 1,100 calves were also provided along with the estates of these people for them to administer and it was decided that the profits be shared. However, only the first lease payment was received and found that they sold the cattle almost immediately without any compensation to the Association.

Not recognizing the true evil intentions of Antonio, the leaders of Korea, Cesar Zaduski (Jardim project director at the time) and the Association of Families in Brazil succumb to the persuasions of Antonio in May 2007 to sign another contract that developed.

He pointed out that while going to solve all the problems of the Association, Antonio drafted the contract with provisions more favorable to him. Under the contract, Antonio would have to use its best efforts to achieve the highest possible price for sale. Proceeds from the sale, the Association would be entitled to receive Brazilian Reals 130 (approximately USD $74) per hectare, free of debts and expenses used to address the various issues listed in the contract. Antonio would receive the net amount remaining. However, Antonio defined the term 'National Park', used throughout the contract ambiguous, as an area within the National Park and the surrounding National Park (in total about 46,000 acres, or approximately 113,700 acres) . Later he used this definition to justify their right to sell the properties that were not within the National Park itself. Along with the contract, an alleged irrevocable power of attorney (power of attorney and notary, "PLN") also was awarded to Antonio, which gave him power to sell the properties in the National Park area itself or a third person .

On May 18, 2007, the broad PLN and the contract drawn up by Antonio were signed by the director Caesar. However, in accordance with the Articles of Association and PLN contract should be ratified by the Board of the Association that they were valid. Antonio Simao persuaded the President to ratify the contract and the PLN. The Board of the Association wrote a letter on May 29, 2007, which expressed concern with the contract and asked the leaders of Korea submitted a formal statement endorsing the agreement and to assume responsibility for it. With the signature of President Kim Sang Yoon of the formal statement on June 1, 2007, the Board of the Association ratified the contract on the same date.

With the PLN in hand, Antonio's strange actions started transfer of the properties of the Association in his name without filing any reports. The estate transferred the Rio Branco and Curvelo to its name and began the process of transferring eight additional farms, including Figueira, Taboquinhas, harmony, which were included in the expropriation for the National Park.

In late 2007, after realizing that something was very wrong, Caesar tried to cancel the contract. However, Antonio replied that it was an irrevocable contract. In panic, Cesar and President Kim accepted a proposal made by another lawyer David de Moura Olindo, who had previously been introduced by Juvenal Mazucato Association (another former director of Project Jardim and present) and had represented the Association The strategy suggested by David was that the Association recognized legal fees that he had to be paid to Dr. David that were large enough to bind the land to Antonio as collateral. Then David took advantage and claimed the Association for a total of approximately Brazilian Reals 10 million (approximately U.S. $ 5.7 million) demanding payment of legal fees due to him. David later gave testimony in favor of Antonio and against the Association during the arbitration hearing with Antonio.

Request Korean leaders to help Hyun Jin Nim and the UCI effort to solve problems

Faced with an irreparable situation in Brazil, Korean and Japanese leaders involved in various aspects of the situation in Brazil (Pres. Sang Yoon Kim, Rev. Joon Soo Yang, Rev. Myung Ki Shin, Rev. Heung Tae Kim, former Director Continental Rev. Jung Soon Cho, and the Rev. Hideo Oyamada) requested the assistance of Hyun Jin Nim. On 2 July 2008 in Asuncion, Paraguay, these leaders made formal written requests to the True Parents requesting the assistance of Hyun Jin Nim, through which the True Parents gave the problem to Hyun Jin Nim to intervene and resolve problems in Brazil. It is then that UCI took part to help the situation.

To resolve these problems, Hyun Jin Nim commissioned a team of UCI to first address the issue of participation Antonio malicious and recover all the lands in Brazil. And second, have a firm understanding of the situation with regard to taxes or penalties and finding solutions by any means necessary whether in negotiating legal, political or social support.

To achieve this mission, UCI first visited Brazil in July 2008 and in-depth interviews were conducted with all staff at the Association headquarters in Sao Paulo, Campo Grande, Garden, all related to the New Hope and gathered much material as possible to formulating comprehensive and systematic countermeasures.

As part of the first actions taken, UCI hired Tozzini Freire, one of the best law firms in Sao Paulo, Brazil, in July 2008 to try to resolve the case against Antonio and many other complicated legal issues. As a result of our decisive action, a civil court judge in Sao Paulo issued a request for a warrant against Antonio in August 2008, which prohibited the exercise of power under the contract of sale of properties until the arbitration is resolved.

Then most of the attention was focused on winning the arbitration because a decision by the arbitral tribunal would be final, without appeal. After accumulating the maximum amount of material possible, and Tozzini UCI sank into the task of investigating the documents to find evidence showing that Antonio violated the duty of good faith and ethical duties as a lawyer for the Association, proposed strategies and continuously to present the best arguments take us to victory.

Then we enlisted two highly respected law professors in Brazil who presented their views on two highly technical aspects of the law that supported our case.

During the arbitration, Antonio made an attempt to settle the case, offering to pay the amount promised in return per hectare to maintain the properties, which was of course rejected by UCI.

The Final Result

On April 28, 2010, we were notified that the arbitration panel had made a decision. However, the decision was not published due to the new demand from Antonio, ensuring that the arbitration process was tainted. He filed a motion to disqualify the chairman of the panel and the final decision on the grounds that he had already been informed of the panel's decision by Clovis da Silva (ex-director of UCI Jardim project) over a year ago. Due to the sensitive nature of this case, the president of the Association of Arbitration set up an independent panel to review the claim of Antonio. On July 7, 2010, the independent panel dismissed the claim of Antonio and finally Arbitration Association issued a decision that was made in April.

Despite the victory through arbitration UCI was able to retrieve the properties that Antonio tried to steal from the Association, there are still many problems related to the estates that need to be resolved. In addition, knowing Antonio, through this process, he will not go away easily and we assume that there will be more battles with him and his accomplices. We still have to negotiate with the government in relation to the areas expropriated for the National Park.

Discovering the problems associated with farms in Brazil is similar to peeling layers of an onion skin. New problems have been emerging continuously, even after we compiled a long list of problems. Five tax foreclosures totaling approximately Brazilian Reals 31,500,000 (updated to December 2009), five tax administrative procedures for a total of approximately Brazilian Reals 32,900,000 (as at April 2010), and ex-attorney disputes including the participation of David (Brazilian Reals 10,000,000), Francisco Fernández Wilson (Brazilian Reals 2.7 million), and Laura Cristina Ricci (Brazilian Reals 600,000) still exist. In addition, there are many other problems including foreclosure proceedings of Brazilian Reals 70,000,000 and environmental issues related to finance New Hope, American Hotel and Salobra finances.

UCI has been providing professional comprehensive measures and countermeasures to solve these problems and has been consistently implementing them in phases. Still will require countless hours and resources to solve these problems in the future. However, it is ironic that at the time we won a historic victory in the recovery of more than half of the properties of the Association, a massive worldwide accusation being made against Hyun Jin Nim and against UCI using the incident as evidence of the alleged "hostile takeover." Now that the Rev. Shin Dong Mo and the International Headquarters of the Unification Church have been officially banned from UCI and the High Council to assist the Association of Families of Brazil through legal measures, we only hope that they can protect and maintain true legacy of the Father in Brazil in a responsible manner.

We wish them well.

July 12, 2010


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