Bob Duggan

US Bankruptcy Court Ruling: Scientologists Matt and Kathy Feshbach Cannot Discharge $3.8 Million in Income Taxes

Fessbachs

An excellent article in Forbes by Jay D. Adkisson concerns Scientologists Matt and Kathy Feshbach. Adkisson’s article was the feature subject of a recent column Tony Ortega’s Underground Bunker. The community commentary was fascinating.

Essentially, the US Bankruptcy Court refused to allow the Fessbach’s to discharge $3.8 million in their Chapter 7 bankruptcy.

In her 40 page ruling, US Bankruptcy Judge Catherine McEwen cited both the Fessbach’s refusal to curb their lavish spending and large donations to their church (Scientology) as among the reasons for refusing to discharge their substantial tax debt via bankruptcy.

In September 2008, the Fessbach’s made an Offer in Compromise (OIC) to the IRS to settle their 2001 tax debt of $3.6 million for $120,000, this to be made in payments over 48 months. The IRS declined the Fessbach’s unreasonable offer to settle for pennies on the dollar of the amount owed.

Judge McEwen wrote:

Feshbach.1
The Fessbach’s made “in excess of $21 million in income” and yet sought to discharge $3.8 million in taxes owed. The court remarked that the Feshbach’s clearly had the money to pay their tax debt but did not do so. The Feshbach’s tried to claim their lucrative income as “phantom income” that they never really had. The court rejected their line of argument in its ruling:

US-v-Feshbach-Memo-on-Dischargeability

Note: Hover over the document with your pointer to get the control panel to appear.

The Bankruptcy Court’s ruling stands in stark contrast to the Feshbach’s 2011 declaration in which they represented themselves as veritable paupers:

Feshbach-Declaration.2011

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Keeping Up with Matt Feshbach.

Even during his Chapter 7 bankruptcy, Matt Feshbach was still promoting his “World Famous” Finance Seminar to his fellow Scientologists:


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In her 2017 ruling against the Feshbach’s, US Bankruptcy Court Judge Catherine Peek McEwen noted:

“…how does any portion of the Feshbachs’ half-million dollars-plus in charitable contributions aid them to repay their tax debt? If there’s an explanation, it wasn’t offered at trial. As a rule, it’s hard to imagine how giving money away would bolster an individual’s future income potential. And this case is no exception to that rule. The overwhelming majority of the Feshbachs’ charitable giving benefitted a church that happened to be one to which Mrs. Feshbach’s personal interests were directly tied. In fact, Mrs. Feshbach owned and operated her own mission, with the main purpose of “introduc[ing] people to what [her church’s religion] is.”Thus, it’s quite clear that there was no link at all between the hundreds of thousands of dollars that the Feshbachs donated to the church and Mr. Feshbach’s earnings, but rather, there was a direct link between the charitable spending and Mrs. Feshbach’s religious pursuits. The Court does not admonish the Feshbachs (or any other debtors) for supporting worthy charitable causes. However, “[i]f individuals choose to donate part of their income to charity, whether religious or secular, they must adjust their expenditures accordingly to live within the confines of their available income.”

Judge McEwen continued:

More to the point, the Feshbachs could have immediately reduced their tax debt by more than $1 million by simply canceling their personal vacations and giving up the rented house in Aspen. They could have saved a similar amount by dramatically reducing their unreasonable clothing allowance and foregoing charitable giving altogether. These are just a few of the available examples that prove the superficiality of their claimed inability to pay.

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Like Richie Acunto before them, Matt and Kathy Feshbach become bankrupt Scientologists. Richie Acunto’s $10 million dollar IAS trophy ignominiously wound up for sale on eBay. That money could have helped Acunto rescue his company Survival Insurance. See Tony Ortega’s excellent article The Scientologist who wouldn’t fly: The rise and fall of insurance mogul Richie Acunto. Likewise, the millions the Feshbach’s gave Scientology over the decades could have paid their income tax liability.

Matt Feshbach, the one time master of the trading world with his brothers and their “shorting against the box” strategy was ultimately financially ruined because he simply did not pay his income taxes when he had the money to do so. Feshbach claimed changes in the tax code were responsible but the court established that despite these changes Feshbach had the income to pay his tax bill.

The US Bankruptcy Court noted that the Feshbach’s could have paid their entire tax debt had they simply curbed their excessive and lavish spending on a luxury lifestyle. The Feshbach’s thought they could ultimately beat the IRS by going bankrupt. However, they lost that bet when the court found that the couple had, “willfully attempted to evade their tax debt within the meaning of 11 U.S.C. § 523(a)(1)(C).

Judge Catherine Peek McEwen will enter a separate final judgment in favor of the United States in this proceeding. Matt and Kathy Feshbach will have to pay the $3.8 million in back taxes they owe the IRS.

In the conclusion to her ruling, Judge Catherine Peek McEwen said something that both the Feshbach’s and the Church of Scientology itself should take heed of but never will:

Sometimes, as with the facts in this proceeding, it is tragically foolish to hold firm to a spend-money-to-make-money conviction. The Feshbachs made poor spending decisions, continually leading a life of excess in the face of serious, known financial obstacles. At all times, their primary concern should have been reducing their substantial tax debt. But as their immoderate spending choices show, they were far more focused on living in the lap of luxury. They would have been wise to heed the proverb which cautions that enough is better than too much. As it is, however, the Feshbachs’ misjudgment ultimately cost them complete relief. Having concluded that the Feshbachs willfully attempted to evade their tax debt within the meaning of 11 U.S.C. § 523(a)(1)(C), the Court rules that such debt is nondischargeable. Accordingly, the Court will enter a separate final judgment in favor of the United States in this proceeding.

“Enough is better than too much” is a lesson that the rapacious Church of Scientology will never learn. Wanting too much of everything — money, breaking up families, punishing people, using child labor and so many other things — is one of the main reasons why Scientology is collapsing.

The Church of Scientology Increasingly Embraces Big Pharmaceutical Companies

CCHR.JAWThe Church of Scientology is infamous for its rabid attacks on Psychiatry and what it calls “Big Pharma.” In the tweet above we see Scientologist and OSA operative John Alex Wood going straight for the jugular by candidly and publicly admitting that the true purpose of Scientology’s lunatic Citizens Commission on Human Rights (CCHR) is, “the total ANNIHILATION of psychiatry world wide.”

Scientology is opposed to psychiatric drugs in particular and all pharmaceuticals in general. This opposition is driven by Scientology’s belief that drugs “mask the symptoms” of the underlying spiritual distress that is actually responsible for illnesses.

Scientology does not believe that mental illness exists. Scientology utterly dismisses Psychiatry as a fraudulent science and claims that “psych drugs” are part of a money-making racket designed to enslave and destroy people by drugging them into a crippled and helpless state solely for the profit of drug companies.

Scientology’s alternative to Western medicine is its own $360,000+ program of systematically exorcising one’s body thetans. However, as Scientology considers its OT levels a “trade secret” — an odd term for a so-called religion — Scientology cannot publicly discuss its OT levels. Thus, Scientology is left in an odd position of negating Psychiatry while being completely unable to discuss its trade secrets which purport to hold the key to solving all of the existential problems of human life.

Given this context, it was quite surprising for me to see Tony Ortega’s story today in which the Scientology father-daughter team of Bernard and Meghan Fialkoff opened the NASDAQ trading session. I say this because the Fialkoff’s are prominent leaders in Scientology’s front group the Foundation for a Drug-Free World. The Fialkoff’s are front and center of this NASDAQ PR photo:

NasdaqGroup

The Scientology Cult takes the NASDAQ open by the the Fialkoff’s as a big PR win. However, 325 major pharmaceutical firms are listed on the NASDAQ. Many of these firms make Psychiatric medications. Over against this, the Fialkoff’s are advocating that people live drug free lives and belong to a Cult whose avowed purpose is to destroy Psychiatry and Psychiatry drugs.

Bernard and Meghan Fialkoff opening the NASDAQ trading day is like fervent anti-gun advocates opening a gun show. That Scientology Freedom of Medal winners Meghan and Bernard Fialkoff must literally go into a Big Pharma stronghold like NASDAQ in order to get Scientology some PR drips with both irony and Xanax.

This is exactly like Scientology billionaire Bob Duggan who donated $72 million in Big Pharma stock (AbbVie Inc) to his private foundation and earmarked the dividends of ~$2.9 million per year to fund Scientology and its phony front groups.

Here are 50 of 325 major pharmaceutical firms listed on NASDAQ. This is what Meghan and Bernard Fialkoff essentially endorsed today when they opened NASDAQ trading:

AC Immune SAACIU
ACADIA Pharmaceuticals Inc.ACAD
Acasti Pharma, Inc.ACST
AcelRx Pharmaceuticals, Inc.ACRX
Achaogen, Inc.AKAO
Achillion Pharmaceuticals, Inc.ACHN
Aclaris Therapeutics, Inc.ACRS
Acura Pharmaceuticals, Inc.ACUR
Adamas Pharmaceuticals, Inc.ADMS
Adamis Pharmaceuticals CorporationADMP
Aduro Biotech, Inc.ADRO
Advanced Accelerator Applications S.A.AAAP
Advaxis, Inc.ADXS
Aeglea BioTherapeutics, Inc.AGLE
AEterna Zentaris Inc.AEZS
Affimed N.V.AFMD
Agile Therapeutics, Inc.AGRX
Agios Pharmaceuticals, Inc.AGIO
Aimmune Therapeutics, Inc.AIMT
Akari Therapeutics PlcAKTX
Akebia Therapeutics, Inc.AKBA
Akorn, Inc.AKRX
Albireo Pharma, Inc.ALBO
Alcobra Ltd.ADHD
Alder BioPharmaceuticals, Inc.ALDR
Aldeyra Therapeutics, Inc.ALDX
Alexion Pharmaceuticals, Inc.ALXN
Alimera Sciences, Inc.ALIM
Alkermes plcALKS
Alnylam Pharmaceuticals, Inc.ALNY
AMAG Pharmaceuticals, Inc.AMAG
Amarin Corporation plcAMRN
Amicus Therapeutics, Inc.FOLD
Amphastar Pharmaceuticals, Inc.AMPH
ANI Pharmaceuticals, Inc.ANIP
Anthera Pharmaceuticals, Inc.ANTH
Apricus Biosciences, Inc.APRI
Aptevo Therapeutics Inc.APVO
Aquinox Pharmaceuticals, Inc.AQXP
Aralez Pharmaceuticals Inc.ARLZ
Aratana Therapeutics, Inc.PETX
Arbutus Biopharma CorporationABUS
Ardelyx, Inc.ARDX
Arena Pharmaceuticals, Inc.ARNA
Argos Therapeutics, Inc.ARGS
ArQule, Inc.ARQL
Array BioPharma Inc.ARRY
Arrowhead Pharmaceuticals, Inc.ARWR
Ascendis Pharma A/SASND

Scientology Billionaire Couple Bob and Trish Duggan Help Fund Scientology with 1,000,000 Shares of a Drug Company

DugganInvictus2-e1417143742557

IRS tax forms show that the Scientology billionaire power couple  Bob and Trish Duggan  placed 1,000,000 shares of AbbVie Inc., a pharmaceutical manufacturer, into their private foundation in December 2015. At that time, AbbVie shares  were trading in the $59.00 range. This gave their foundation a fair market value of $59,240,000.

As of July 15, 2017, AbbVie shares closed at $73.11, thus giving the Bob and Trish Duggan  Foundation an asset value of $73,110,000. The dividends paid by AbbVie will be donated to Scientology churches and social betterment groups per the terms of the Duggan’s Foundation.

As this Scientology Money Project research was first exclusively reported on Tony Ortega’s Underground Bunker, AbbVie makes Humira, the best-selling pharmaceutical drug in the world. In an ultimate irony, then, the Church of Scientology, a group that attacks “Big Pharma” as an evil, will profit each year into perpetuity on the dividends from a major pharmaceutical company in Big Pharma.

The PDF for the Duggan Foundation can be opened here: Bob.Trish.duggan.Foundation

Bob.Trish