Against the Gates of Hell “What is it about the gates of Hell that compels people to wander into it?


Throughout religious history, no church has ever been able to avoid internal strife. The Worldwide Church of God was not so naive as to think it could escape its share of dissent, for nothing engages man’s deepest emotions so much as religious beliefs. Every schoolchild knows about the schism that developed within the Roman Catholic Church in the ninth century, which, two centuries later, resulted in the separation of the Greek Church from the Roman Communion. And of the great split that occurred in the late fourteenth century, healed forty years later at the Council of Constance; and, of course, of the Protestant Reformation that came about in the 1500s as a result of another division. Large religious bodies, those of lesser size, and those on far smaller scales have had — and probably always will have factional strife.

So we knew of and expected problems with some disgruntled former members. And they came. Some were motivated by sincere, deeply held beliefs, others impelled by less honorable reasons. All, however, were settled as the Church grew.

In recent years, we had known that a few dissenters had been dissatisfied with the way tithes and voluntary contributions, upon which our Church depends for its financial support, were being utilized to spread the gospel of Jesus Christ in our Church. Trouble had been in the air, but few believed it was serious. We knew our house was in order, and we were fully confident of answering all questions satisfactorily and handling all problems.

Nobody expected the state of California to engineer a shocking and lawless takeover move to support the claims of a handful of former members. Nor one conducted with such a mind-boggling disregard of legal procedures and the civil rights of the individuals and the spiritual body against which it was directed.

Later I would learn that the invasion had been planned and conducted like a military coup d’etat, complete with armed officers instructed to “use all force necessary.” The terrifying details were to come to light in the astonishing days and weeks that were to follow.

Suspecting that something highly unusual, if not evil, was about to erupt, Virginia dialed my home telephone. As she did so, she glanced at the glass door and saw two burly men walking down the corridor toward the executive office. My wife, Natalie (“Niki”) answered the phone but Virginia now had no time for explanations. “Please ask Mr. Rader to call as soon as he arrives,” she told Niki. “It’s an emergency.” At that moment I was on my way home to shower, dress, and come to the office.

Virginia stood in the doorway as one of the stranger’s — in his middle-thirties, six feet tall, with dark wavy hair and a swarthy complexion — came up. Behind him was a black man, taller and heavier.

“What can I do for you?” Virginia asked quietly, though admitted later her heart was racing.

“I’ve come to take over,” the first man said, thrusting a sheaf of papers at her.

“Who are you?” Virginia demanded.

For the first time, the man identified himself. “I’m Rafael Chodos,” he said, “acting on behalf of Judge Steven Weisman. He’s the receiver and he’s now in charge.” Chodos is a private attorney with offices in Beverly Hills. Weisman is a retired judge of the Los Angeles Superior Court. Virginia was not intimidated. “I don’t know you from Adam,” she said firmly. “And you’re not coming in here to take over anything until I talk to the attorney for this Church and the college.” She half expected the two men to force their way into the office but they remained outside the door.

The call director on her desk flashed. Virginia called to young Michelle Dean, one of her assistants, to guard the door while she answered. Feisty little Mickey Dean, barely five feet tall and well under 100 pounds, glared at the invaders and they glared back, but they did not move from the entrance. “Go get your camera,” said the one called Chodos, “and take a picture of her, for our files in case we have to arrest her.” Mickey would not be intimidated. “Take a picture if you want to,” she told them, “but you’re still not coming in.”

I arrived at my home, which is about a half mile from the college, at 9:00 A.M. My wife met me at the door and told me to call Virginia. I could tell at once that Virginia was under considerable emotional stress but controlling herself. She explained what was happening: “They’re trying to take over.” “Who’s trying to take over what?” “They say they’re receivers and that they’re going to take possession. They’re on the other side of the door.” Less than a dozen feet from where she was calling, tiny Mickey was standing like Horatius at the Tiber Bridge, holding off the Etruscan army to Protect Rome. Are they private people or state people?” I asked. She replied “That they seemed to be private lawyers. In that case,” I told her, “call Security and have them thrown out. Lock the door. And keep them out until we find out what this is all about.” That was all Virginia needed to hear. “Fine,” she responded. “I’ll do just that.” And she did. At the door, she told the two men: “Our attorney says that until he has had time to study your papers, you are not allowed in this office.” So saying, she shut the door in their faces and turned the bolt. A moment later my phone rang again. Virginia reported that, for the time being at least, the office was secure.

Part Two.

We had to mobilize our defenses and there was not a moment to lose. I knew that Ralph K. Helge, counsel for the Church as well as a director and its secretary, was in Tucson on Church business. I asked Virginia to call him at once. She reached him by page at the airport, while she was telling him what was occurring, she looked up and saw a local policeman behind the locked door, banging on the glass with his billy club and demanding entrance. Helge said he’d be in Pasadena within the hour to confer with me at my home.

Not even a policeman threatening arrest could make Virginia or her staff of loyal secretaries buckle. “It’s my job to protect this office,” she told him through the glass. “You’re not coming in!” Meanwhile, I instructed Virginia to call all offices at the college. Every critical entrance and exit must be locked and guarded to prevent anyone from removing records until the papers flaunted by the invaders were studied to determine what they were and if they had been properly and constitutionally executed.

As an attorney, as an American, I have faith in the American, system of justice. If a clearly illegal act was being committed, I felt certain that, in the end, the law would prevail. In the Bill of Rights of the United States Constitution such sacred precepts as due process of law, presumption of innocence, protection from unreasonable search and seizure, and proof beyond a reasonable doubt are clearly set forth.

I began rounding up the Church’s lawyers to state our case, called Morton Gerson, a young attorney who had acted in our behalf from time to time, and asked him to obtain the documents the invaders were using as excuse to “take over” the Church and college. He got them from Virginia and brought them to my home; we then drove at once to the office of Allan Browne of the law firm of Ervin, Cohen and Jessup, on Wilshire Boulevard in Beverly Hills. Allan, a classmate of mine at the University of Southern California Law School, is a brilliant attorney with whom the Church consults often on legal matters.

We began poring over the papers. Soon Ralph Helge joined us; en route from Tucson he had received a special message from us I which the pilot had delivered to him in midair. After reading the documents, their full meaning became only too plain. The most dramatic — and the most perilous — confrontation between Church and State in the two centuries of American history had begun.

Chapter 5: Star Chamber

Late in 1978, several dissident, former Church members trooped into the law offices of Hillel Chodos in Beverly Hills with a list of so-called improprieties they said were occurring within the Church. After hearing them out, Chodos went to see Lawrence R. Tapper, deputy attorney general of the state of California, and recited to him the accusations made by his clients.

Tapper listened. Then without investigating or verifying any of the charges, without notifying Church officials and giving them their Constitutionally guaranteed right to refute or explain them, he set into motion legal machinery for seizure.

The first step was to draw up a complaint based on the false charges. Next, contrary to the courts own rules, a Judge was Telephoned for a nearing for the appointment of a receiver on an ex exparte basis.

It is crucial to understand the meaning of this legalistic Latinism. An ex parte order is a legal instrument made by or in the interest of only one party to an action. It is a remedy granted by judges only in instances where urgent action is essential to prevent a gross injustice. Let me cite examples. If a businessman is convinced, and presents satisfactory evidence, that his partner will close out an account or flee with assets of a jointly owned company, he may apply for and receive ex parte relief. If an estranged wife has reason to believe, and can offer proof, that a husband is on the verge of removing their children to another state, a judge may sign such an order.

But in the vast majority of cases, orders that could have serious consequences to one of the parties involved in litigation are granted only after hearings at which all sides — have had a chance, to be heard. Receiverships, especially, are normally ordered only after extensive legal proceedings in which plaintiffs offer compelling need for such action, and defendants are given their day in court. Never can such a hearing take place without four hours’ notice to the other party.

The Worldwide Church of God was not given this notice. Tapper and Chodos got the illegal hearing as requested, and a receiver was named-all without notice to the Church. Every step of the way, from complaint to receivership, the Church was kept in the dark about proceedings that involved its independence and its very existence.

It was not until one month afterward that we learned a court reporter had been present at the hearing, conducted on January 2, 1979 in the chambers of Judge Jerry Pacht,* sitting in Department 85 of the Los Angeles Superior Court. According to the reporter’s transcript, Tapper attended, accompanied by Hillel Chodos, his brother Rafael, and their associate Hugh John Gibson, attorneys for the six complainants or “relators,” as they were called in the complaint. Also present was former Judge Steven Weisman a close personal friend of Hillel Chodos and the petitioners’ hand-picked candidate for the receiver’s job. Named, as respondents in the suit were several corporations, including the Church, Ambassador College, and the Ambassador International Cultural Foundation. Also named, as respondents were certain individuals, principally Herbert Armstrong and Stanley Rader.

The transcript is highly revealing. Note, for example, this statement made to the judge almost at the outset by Hillel Chodos: “Your Honor, I want to interrupt just to state for the record, a copy of the proposed pleadings was furnished to you this morning. The original is in my briefcase. It has not yet been filed [my emphasis], but we are prepared to file it and pay the necessary fee at any moment.

“It is just that we did not want a public filing before coming to see you. I spoke to the clerk this morning and told him we would talk about that.” Judge Pacht responded: “Well, we are going to have to get it filed if I am going to grant you any relief, as I am sure I don’t have to tell you, Mr. Chodos.”

The proceedings ignored a specific mandate published in the Writs and Receivers Manual of the Los Angeles Superior Court. Rules 205.2 and 303.5 of the manual require that all attorneys who plan to submit ex parte applications must notify either the opposing party or his counsel in advance, so that the other side may appear and be given its chance to have its say. Nothing in the transcript of the proceedings even hints that this was done.

To his credit, however, it must be said that Hillel Chodos was at least aware that we should have been informed and said so: “I recognize that any request for an ex parte receiver, without notice, has to be viewed against a strong presumption that it is an emergency measure to be used with great caution,” he told Judge Pacht. “I would suggest to you, however, that at least insofar as pertains to the Worldwide Church of God, Inc., Ambassador College, Inc., and Ambassador International Cultural Foundation, Inc., that the usual principles are not applicable. All of these corporations are organized and exist under California law exclusively for charitable, religious, and educational purposes.” Their property, he argued, “rests in the court’s custody, subject to the supervision of the court on the application of the attorney general. In effect, there are no private interests.”

Chodos was now expounding a strange concept with awesome implications for all religious organizations. Heed closely what he was saying: The court’s powers run “to all persons within the court’s jurisdiction, and particularly to charitable trusts which are organizing and existing under the State of California [my emphasis]. In fact, this court, as I understand it, is the only court that has complete jurisdiction and supervision over the affairs of these three charitable corporations.” The attorney general agreed with the view that all churches in the state of California are actually “charitable trusts.” And, when the session that afternoon ended, Judge Pacht ruled that this was indeed so. By accepting this concept, all concerned did nothing less than trample upon such Constitutional rights as due process, the First Amendment guarantee of separation of Church and State and other basic protections for citizens of the United States of America.

For if a church, whatever its denomination, is to be construed as a “charitable trust,” it cannot own its own property. it is not the master of its own affairs. Its leaders are no more than trustees who serve at the pleasure of the State. Its assets are not its own but become public records. A church is nothing but a ward of the court, each of its actions subject to State scrutiny — which has no limitations — and to its supervision and control.

A church, in short, is no longer independent but subject to the trust laws. It was a concept as illogical as a scene from Alice in Wonderland. Indeed, attorney Allan Browne, in a memorandum several months later, wrote this little parody:

ALICE: When is a church not a church?

WHITE RABBIT: When it is a charitable trust!

ALICE: When does a church become a charitable trust?

WHITE RABBIT: When the State says so.

ALICE: Things are becoming curiouser and curiouser.

For about half an hour, Tapper, Chodos, and their handpicked candidate for the receiver’s job argued the fate of the great and flourishing Worldwide Church of God, with no representative of the Church present to defend itself.

What, indeed, were the complaints? Most were based, not on hard fact and actual knowledge on the part of any of the dissidents, but on the tenuous grounds of “information and belief,” legalese for “gossip and rumor.”

Attached to the complaints were a number of declarations signed by certain relators and attorneys, but none of them in the proper form to constitute evidence in a court of law. The accusations were based almost wholly on hearsay — in some cases double and triple hearsay, meaning that the complainants heard their stories from someone who got them from another party who had been told by — etc.!

In support of these requests to the court, the complaint listed in inflammatory language a number of specific charges, among them that Armstrong, Rader, and others were “siphoning off” Church assets for their “own personal use and benefit”; that this 14 pilfering” of Church revenues was continuing “on a massive scale”; that during the previous six months the properties of the Church were being liquidated on the same “massive scale”; and that the defendants were even then busily shredding, destroying, and otherwise disposing of records of financial dealings “in an effort to frustrate discovery of their wrongdoing and to obscure the facts.”

The attorney general’s complaint was divided into four sections.

The first sought an accounting of Church funds;

the second asked that the directors of the Church be removed and a new board be chosen by vote of the members;

the third asked for appointment of a receiver;

and the fourth sought injunctive relief to insure cooperation.

Not one of the accusations had any validity whatever. Soon afterward, evidence was offered to the courts proving them false.* Nevertheless, on that afternoon in Judge Pacht’s chambers, the Worldwide Church of God was dealt a stunning blow. By a stroke of the pen, it was thrown into receivership — perhaps the most drastic remedy known to the law.

The receivership order armed one individual with extraordinary powers. He was not a member of the Church. He knew little, perhaps nothing at all, about its history and traditions. He had no knowledge of its doctrines, global reputation, goals, and diverse activities in all its fields.

*See pages 88-93 for a point-by-point examination and refutation of the charges leveled at the Church and its leaders.

(Editors note: Within these pages* Rader offers bullshit/whining excuses about the state, the receivership, all the havoc that occurred at the time, etc. Most of the wcg’s problems at this point were caused by their own bad behavior. What they taught from the pulpit about obeying government was thrown to the wind by Herbert Armstrong. He told members to send their tithes to Tucson (Herbies safehouse) which caused financial issues for the church. But wait there’s more, the financial fleecing of the flock continues:

Word of the appointment of a new receiver was heard with alarm by the membership.

Once again, as they did less than two months earlier, men, women, and children converged on headquarters in a massive protest demonstration.

Once again families poured in from all over, with suitcases, sleeping bags, Bibles, games for the children, sandwiches, and coffee jugs, determined to remain until this new burden was lifted.

As before, they stationed themselves inside the building, human barricades against the imposition of the court order they deemed illegal.

They were there for prayer and meditation, and, as in the earlier demonstration, they were prepared to go to jail rather than have their Church taken over by an outsider.

Our attorneys instantly filed an appeal. Pending its outcome, Judge Title required the Church to post a $1 million bond if we wanted to keep the new receiver away.

On Tuesday evening, just a day after the new order was announced and the new sit-in begun, a new miracle occurred. Aaron and Kevin Dean conceived the idea of organizing a vast telephone appeal to raise the needed money.

With the aid of about a dozen volunteers, they manned the phones on the fourth floor of the Administration Building, calling churches all over the United States and Canada. They asked each one to name three members who would, in turn, call other members in their areas.

The results were little short of incredible. By next morning, $200,000 was received in cash, flown and wired in from all over; by afternoon, the total had swelled to $400,000. By then, the appeal had switched from cash to pledges as surety for the bond.

The campaign continued for forty-eight hours, during which the Dean brothers and their aides got virtually no sleep. On Thursday evening, the phone blitz had brought in pledges well beyond the required sum, and before the week was out, the total had reached $3.4 million!

Many hundreds of members responded, signing affidavits in which they pledged anywhere from $100 to as much as $50,000 and higher. The affidavits guaranteed that the signers would come up with cash if it was needed. As collateral for the pledges of $2,000 and more, the members listed assets ranging from jewelry, bank accounts, and automobiles to their homes and furniture. In court, we posted the surety-backed bond, which was accepted by Judge Title. After a final service, the members who had come a second time to defend their church left for home, smiles on their faces.

We could afford to smile, too, but not to relax. While we had regained control over our own affairs, our appeals were moving slowly through the courts, which march in slow cadence. The prohibitory portions of the court’s injunctions were still in effect. The threat that some outsider could once again intrude into our midst hung over our heads like a sword of Damocles, and would not be removed until a final decision had been made. We had been seriously crippled, but thanks to our strength and the remarkable joining of hands by our members, we were still alive and fighting hard to prove that California authorities had no legal right to climb over the high wall separating religion from government. We had some breathing room, but we could not breathe easily — not until the peril to us and all religions in America was ended.

(Editors note: Shameless propaganda. What they did above was to jeopardize everyones financial future for the benefit of Herbert Armstrong who caused all the problems in the first place.)

Rader also drones on and on about the violation of privacy rights of the people. What his real concerns were, the church databases. In part three we continue with this:

Yet he came to our Church with full legal authority to do the Following: To take possession and control of the Church, including all its assets, real and personal, tangible and intangible, of every kind and description…

More on the receivership HERE

Part Three.


Stan the man...

Yet he came to our Church with full legal authority to do the Following: To take possession and control of the Church, including all its assets, real and personal, tangible and intangible, of every kind and description…

To supervise and monitor all of the business and financial operations and activities of the Church… if he does so determine, he shall have the right to take over management and control of the Church to whatever extent that he, in the sound exercise of his sole discretion, deems necessary.

To hire, employ and retain lawyers, accountants, appraisers, business consultants, computer experts, security guards, secretarial and clerical help, and employees of all sorts to assist him in the discharge of his duties pursuant to this Order; and he is authorized to pay reasonable compensation to all his assistants out of the funds and assets of the Church, subject to the supervision of this Court as hereafter provided.

To take immediate possession of all books and records of the Church, no matter where or in whose possession said records may be found. These records are to include without limitation journals, ledgers, bank statements, vouchers, invoices, logs, memoranda, computer-readable data, and membership lists. These books and records shall be made available for the use of the employees of the Church in the carrying out of all their duties. They shall also be made available to the representatives of the plaintiffs in this action, for use in preparing for the trial in this action.

To supervise and control all the business and financial operations of the Church, including both ordinary day-to-day operations, and extraordinary operations. Except as is otherwise provided herein with respect to Messrs. Herbert W. Armstrong and Stanley Rader, the Receiver is hereby authorized to suspend or terminate, as he in the sound exercise of his sole discretion determines is necessary, any employee, officer, or agent of the Church (subject to any contractual employment rights the suspended or terminated party may have), and to direct that said employee, officer or agent not be permitted access to any of the grounds or facilities of the Church from and after the date of such termination or suspension.

Messrs. Armstrong and Rader will be permitted to continue their prior functions as representatives and authorities of the Church unless and until they are, either of them, removed by proper action of the Church pursuant to its By-laws and Articles; or unless they are removed by further order of this Court pursuant to an application on the part of the Receiver. If the Receiver deems it necessary at any time hereafter pending the trial to move the Court to remove either Mr. Armstrong or Mr. Rader or both, the Receiver may file a petition with the Court on notice to the defendants, and the Court will hear the matter and make a determination on that issue…

To employ, to the extent necessary, accountants, auditors, and attorneys to conduct a thorough audit of the financial and business dealings of the Church; and to compensate said professional assistants out of the Church treasury…

To supervise the deposits and disbursements of the funds by the Church in accordance with the terms of this Order… [he] shall have the right, in the sound exercise of his sole discretion and at any time, to take possession and control of the funds of the Church forthwith by notification to the Court and to the defendants, and to deposit them in a special Receiver’s account, if he deems it necessary.

It is little wonder that legal scholars, studying the events of that day, were incredulous. Many wrote to us or expressed themselves in print. I quote from just one, written by Jerry Wiley, associate dean of the University of Southern California School of Law in Los Angeles. Writing in Liberty,*Professor Wiley said: What Deputy Attorney General Tapper asked — and got — from the court is mind-boggling to the student of constitutional law: that the judge meet with him, the accusers, and their attorneys before he was required to file any action against the church or even notify the church that an action was filed, and that immediately upon filing the suit, the judge would order a receiver placed in control of all the church’s local assets, and, moreover, forbid anyone in the church from managing and disposing of a church asset. The court also retained the power to decide whether what the church proposed to do was religious.

* Liberty, vol. 74, no. 3, May-June 1979. Liberty is published by the Religious Liberty Association of America and the Seventh-Day Adventist Church. The association declares itself “dedicated to the preservation of religious freedom” and advocates “no political or economic theories.”

The deputy attorney general well knew that he was asking the court to commit itself to giving the state what it wanted against the church without the church’s even having had opportunity to know that action was pending. Indeed, he was asking an advisory opinion from the court concerning the outcome of a case not yet filed, when the law in his jurisdiction did not provide for advisory opinions. He was asking the court to appoint someone to run the church on the unsubstantiated accusations of six dissident members — some say, “excommunicated” members. He was asking the state’s judicial branch to take over the church before a case was filed, and upon the uncorroborated accusations of the dissidents — all this in spite of state and federal constitutional provisions for strict separation of church and state!

Cleaning House

On the morning of January 3, 1979, the day after the hearing, Judge Steven Weisman, the temporary receiver, and his task force stormed into the Hall of Administration to fulfill their State-approved functions. As I described in the opening chapter, rose petals were not strewn in their path. Virginia Kineston and her small group of brave determined, and baffled young women barricaded themselves inside the executive offices.

The offices were protected by an alarm system; moreover, only a few persons had a key. We had taken the precaution of giving an extra one to the security office but it was locked in a safe. Virginia had telephoned and told an official: “Under no circumstances should that safe be opened and the key taken out.”

The hours passed slowly. A silence, chill and forbidding, pervaded the building. Some fifteen miles away I was in a nonstop meeting with a corps of lawyers. From time to time, I would call Virginia, ask what was happening and pass along instructions. At 1:00 P.m., the girls went into the small kitchen adjoining the office and made sandwiches and coffee, then re turned to their watchful waiting.

At 3:30, Virginia was on the telephone when she heard a key grating in the lock. She looked up and saw what she later described as a “swarm of people.” A security guard had panicked and given the intruders the emergency key.

“Those people,” Virginia said afterward, “literally charged into the office. There was that very fat man in the rumpled suit, Hillel Chodos, and his brother, followed by at least a dozen others. The place became an instant madhouse. They began opening doors to offices, peering into the shelves, looking into desk drawers.”

Over the bedlam, Virginia called out instructions to the girls: “Keep an eye on each and every one of them! Don’t let them rummage through the files. Make sure they don’t put anything in their pockets or briefcases. If they want to take something, make them sign for it and take a description of what it is.” The men tore through the offices, followed by the girls.

Striding to the phone, Virginia called the photo department. “Get a man here at once to get pictures of what’s happening.” She called the television studio to send up people to take a visual and sound record too. Then she telephoned me. Breathlessly she said: “They’ve broken in. They’re taking over the whole office.”

Total chaos followed. The men — the Chodos brothers, and others who identified themselves as government agents — ransacked the place. Despite the brave attempt of the secretarial staff, records and files, confidential or no, were rifled, gathered up, and carried off. Many of them are still missing months later, and the state has consistently refused to give any accounting of what was taken despite repeated requests from the Church.

In the basement garage, some agents pounced on a large box in the back seat of an automobile I use on Church business. They opened it, saw it was filled with files, and gleefully impounded it, satisfied they had captured vital confidential records that I would later try to smuggle out of the building.

The “confidential” papers were records of a legal case tried several years before by Ralph Helge’s office; they had nothing whatever to do with the financial operations of the Church. I had asked for the files to check some facts and then sent them downstairs to be returned to Helge’s office.

Judge Weisman wasted no time in demonstrating power. He told Hillel Chodos to send Virginia to the personnel office where he had installed himself; he was beginning to’ clean house and apparently decided to start with my executive secretary.

Virginia went down and saw him for the first time. Weisman, a short, crippled man of medium build, leaned back in his chair. “I guess you probably don’t like what I’m doing here,” he said. “Of course I don’t like it,” Virginia replied.

“Regardless, I have the authority of the state,” Weisman said, and with that declared that he was “terminating” her employment.

Virginia was aghast. She demanded an explanation and insisted that she would not leave without one. None was forthcoming; Weisman insisted she was “terminated,” that she leave at once, and that other firings would follow.

“What about Mr. Armstrong?” Virginia asked, hardly expecting the incredible reply: “He’s out too.”

Virginia gasped. “You mean he’s fired?”

“Yes, that’s right,” Weisman answered.

“I see. And what about Mr. Rader?” Weisman was unflappable.

“He’s out too,” he said.

The Pastor General of the Worldwide Church of God and his chief aide and adviser had been summarily “fired” by a court appointed receiver. Absurdities were piling on absurdities so rapidly the logical mind could not absorb them. As for her staff and the others in the organization, Weisman said, he would talk to them and “see where their loyalties lay.” Virginia, almost literally unable to talk because of her bottled — in fury, left.

Upstairs she called me and, finding her voice, told me what had occurred. (Later, on a witness stand, Weisman blandly stated that he had not “fired” Armstrong.) All Virginia was allowed to take from the building were her personal belongings. I told her to collect them and come down to Allan Browne’s office with her husband, John, my executive assistant.

They drove to my home to pick up my wife, who had packed a suitcase, knowing I would be in for a long siege.

They arrived at Allan’s office shortly after 6:30 and the long, hard task of planning the counterattack was begun. We had to reestablish order from the chaos, prove that the integrity of the Church leaders was unquestioned, and recover the Church from the control of people who had no legal, much less spiritual, right to be guiding its destiny.

We worked until nearly daybreak marshaling our evidence. We ate when we could: Allan’s offices were littered with trays, coffee cups, and empty paper bags. I managed to get about two hours’ sleep at a nearby hotel where Niki had booked rooms, then returned for another hard session just after sunup.

Earlier, a number of Church members came in to help Virginia and John Kineston search the files, organize and copy them. Immediately after Virginia informed me of the invasion, I had called Herbert Armstrong in Tucson; thereafter, I telephoned him almost hourly, keeping him abreast of developments.

Problems have never upset Mr. Armstrong and he reacted even to this serious threat with serenity, courage, and confidence. Over the years of my close association with this remarkable man, I have noted abundant evidence that he is the embodiment of his own message of hope and trust that the living God will provide man with the wisdom to prevail over obstacles. “No matter how intelligent, alert or resourceful you may be,” he has written, “you need God’s wisdom and help in solving the constant problems and meeting the recurring obstacles that beset life’s path, whether it is in business, a profession, private life or what.

The man who has contact with God, who can take these matters — these emergencies — these problems — in the quietness of his private prayer room to the Throne of Grace and seek God’s counsel and advice is going to have divine guidance… Wisdom comes from God. ” I am certain that Mr. Armstrong took this grave emergency into the “quietness of his private prayer room to the Throne of Grace,” sought God’s counsel, and knew that justice and truth would ultimately prevail. (Editors note: I seriously doubt that Herbie took to prayer. More than likely, he took his problems to the bottle for consolation)

The damage that appointment of a receiver can do to any organization, and most especially a church, cannot be over estimated. It is as though a perfectly respectable individual were falsely arrested on a charge of sexual misconduct. Until the accused can prove his innocence through the laborious machinery of the law, a reputation built up layer by layer over the years has been blackened and virtually destroyed.

Sensational news travels fast and merits black headlines and prime spots on the evening news. If an accusation is made, the vast majority of readers and viewers tend to accept it. In the case of a receivership, moreover, the presumption of guilt created by the court’s order is powerful. Few people ask: What is the other side’s case? Rather, they infer that if the court has been forced to act, something very serious must be afoot.

In just two days we were to reap the first bitter fruits. Headlines throughout the country trumpeted the news that a church was being rocked by a financial scandal so massive, so shocking that the state of California had been forced to step in. And if people missed the headlines, they heard and saw it on television. Camera crews and newsmen descended on the Church in droves.

The name of the Worldwide Church was being blackened before it had been given a chance to say a word in its defense.

The Charges Shredded

There was, of course, a great deal to say. The charges leveled against the Church, Herbert Armstrong, and me by the state of California were specious-cleverly worded and loudly trumpeted to sound meritorious but actually steeped in falsity, inaccuracy, and blatant untruthfulness. It would be useful to consider each of them in detail.

1. The Church has, in the past, refused to make regular and proper accounting of its funds, and continues to do so.
The attorney general’s own complaint belies this, for he in — detailed accounts of Church expenses, gleaned from reports prepared by the Church for the years 1975 and 1976. Actually, outside audits of the financial affairs of the Church and Ambassador College have been made annually since 1956 and, since 1975 the International Cultural Foundation has been audited as well. Arthur Andersen & Co., one of the “big eight” national accounting firms, was retained to conduct the 1978 audit of all three organizations and to verify the earlier audits. There has been no evidence introduced to show or suggest that all audits have not been properly and professionally conducted.

2. Extravagant sums of money have been spent by Armstrong, Rader and other Church officials for foreign travel, lavish gifts, and entertainment.

All these monies were expended in furtherance of what Church leaders and members believe to be its chief mission — establishing religious and charitable programs and spreading the message of the Gospel throughout the world. In company with other representatives of the Church, Herbert Armstrong and I travel many thousands of miles each year to confer with heads of state and other foreign dignitaries as goodwill ambassadors of the Worldwide Church of God.

The members are apprised of these trips, and of other expenses such as gifts, dinners, and receptions that are held for these leaders. Far from “high living,” these are legitimate costs incurred while on Church business and are fully reported in bulletins and memoranda to members.

As a letter written to the editor of the Pasadena Star — News of January 22, 1979 states: “Does Judge Title seriously think that the thousands of people who support this Church had no idea that Mr. Armstrong went on these trips, or were ignorant of the system of Church government?”

The letter concludes: “If the State attorney of California gets away with this infamy, I would advise descendants of the Pilgrim fathers to once again board the Mayflower and sail for the religious freedom of the Old World.” (Editors note: skipping down to point three)

3. Church funds are being diverted by Mr. Armstrong and Rader for their own use.

This charge was aimed solely at me, for no “evidence” was offered linking it to Mr. Armstrong. The attorney general charges that (a) in 1978, I kept the proceeds from the sale of a home in Beverly Hills purchased by the Church in 1971; (b) I then bought another from the Church at a price lower than market value; and (c) a firm in which I was a partner purchased an airplane and subsequently leased it to the Church. It was also charged that my salary was too high. The answers, point by point:

(a) In 1971, I was asked to buy a house in Beverly Hills that would be suitable to entertain foreign guests visiting California at Herbert Armstrong’s invitation. Although the initial financing was arranged by the Church, I bought the house, giving the security in my Holmby Hills home as a down payment, giving the Church a second trust deed for $145,000, and assuming a first mortgage of $225,000. Until I became a Church member in 1975, I made all payments on the house. Beginning in 1976, the Church took over these payments, and paid for other expenses as well, since my residence was used to further the goals of the Church. Both the mortgage payments and maintenance payments were reported by me as income and — I paid taxes and tithes on them. Before this house was sold in 1978, I played host, in furtherance of the work of the Church, to such world-renowned figures as Gideon Hausner, the attorney general of the State of Israel who prosecuted Adolf Eichmann; Dr. Nagendra Singh, a member of the International Court of Justice; Teddy Kollek, the mayor of Jerusalem, and the ambassadors from Jordan to the United States and from Israel to Japan.

(b) The sale of the house, precipitated by Mr. Armstrong’s request that we move to Tucson, brought a profit which my wife and I received as owners. This was never kept a secret from anyone. When the Tucson move was deemed unnecessary, I purchased a house in Pasadena, owned by the college, appraised at $208,000. The purchase price was $225,000, paid in cash. (Editors note: $225,000.00 in 1978 had the same buying power as $856,974.64 in 2016. Annual inflation over this period was about 3.58%)

(c) The story of the airplane goes back to 1967, when my sole connection with the Church was professional. I was neither an officer, a director, nor member of the Church when Armstrong asked me to facilitate the leasing of a plane, as the Church had been unable to overcome a reluctance on the part of the owners to lease to it. The only way I was able to accomplish this was to form a partnership, which then leased the plane to the Church. I agreed to personally indemnify the other partners should the Church default.

As to my salary ($200,000 per year), far from being excessive, it is simply a reflection of my earning power plus my value to the Church. Prior to my employment by Herbert Armstrong, I had a successful practice as an attorney and certified public accountant with many important clients.

I now travel more than 200 days a year on Church business and have, I believe, made a significant contribution to its growth and success. The salary, I cannot deny, is extremely good, but it is certainly not excessive in light of the above. What is somewhat ironic is that it is less than half of the amount demanded by the receiver and his associates as compensation by the Church.

4. Church property, including the 1,600-acre former campus of Ambassador College in Big Sandy in northeastern Texas and 50 parcels in Southern California, was being sold at prices far below market value to raise quick cash for the “personal use and benefit of the individual defendants.”

The Church owned the vast acreage at Big Sandy, having originally purchased the property for development as a sister institution. In 1977, Mr. Armstrong decided that the Big Sandy campus was no longer serving the purposes for which it had been established. He ordered the academic operations terminated at the close of the spring semester. The campus was costing the Church $1.8 million annually in maintenance costs, so it was decided, in 1978, to sell the property.

A buyer was found and negotiations were in the final stages of completion to sell it for $10.6 million. This figure was almost $4 million above the value placed upon the property by a na-tional appraisal firm. The complaint, however, charged that Big Sandy was worth between $30 million and $50 million. Judge Title held in Superior Court that no evidence was produced to substantiate this valuation and, also in court, the attorney general conceded his failure to prove that the property was being sold below its market value. The sale — for $10.6 million, as originally intended — was later approved by the receiver and the court, but a determined group of Church members from Wisconsin successfully enjoined the sale when they learned that the receiver had requested a federal court in Texas to place the sale proceeds in his own account.

Judge Title also held that no evidence was produced to support charges that any of the other properties to be sold were priced below market value. These sales were made following a decision to reduce the number of college-owned-and-maintained properties for faculty members, a decision that rendered a large number of properties surplus. These were sold at prices exceeding their fair market value, all sales proceeds being deposited into the Church treasury.

5. Representatives of the Church have denied access to its books and records and have indicated they will be destroyed through shredding and other means.”

The attorney general was never denied access to our records. He never requested them when he stormed our premises without warning. There is no question that, if he had made such a request, in the same manner as the IRS, it would have been granted. The Church has nothing to hide. All our records, which are our best answer to these charges, are on a computer in a building about a quarter of a mile from administration head, quarters. Herbert Armstrong has not been in this building for many years. I have never set foot in this building; and nobody is hiding anything. The alleged shredding of documents was discussed earlier. Even Judge Title held that the state had presented no credible evidence that any papers had been destroyed, shredded or removed.

6. The properties, revenues and assets of the Church are being “siphoned off” by Herbert Armstrong and myself on a “massive scale,” amounting to several million dollars.

The fact is that the internal accounting system of the Church has scrupulously accounted for every penny received and expended. No “pilfering” or “siphoning” could have taken place without being reflected in the accounting records. Arthur Andersen & Co. was requested specifically, in its audit, to verify the integrity of the internal and external controls in our accounting system and has rendered an unqualified and certified opinion.

7. Mr. Armstrong is a feeble and senile old man.

Outside of the fact, which cannot be denied, that he is eighty-seven years old, this is pure rot. Herbert Armstrong’s vigor and steady stream of activity in behalf of the Worldwide Church of God amply refute this charge.

Since July of 1978, he has traveled extensively, both in this country and abroad. He has visited the People’s Republic of China, Japan, Morocco, Tunisia, and Israel, as well as making many personal appearances in the United States. He has written five books, two of which, The Incredible Human Potential and Tomorrow… What It Will Be Like, have already been published, with all royalties going to the Church.

He contributes regularly to Church publications and has made more than sixty-half-hour television programs. He personally oversees all copy in Church publications and conducts many meetings with ministers and officials of the Church. These facts were established by actual court rulings or clear evidence, uncontradicted by the attorney general, which was presented by lawyers for the Church. But the assault did not stop. (Editors note: Yep, you guessed it. Stan had to use not 3 or 4 points, but 7. The number “7” means something to church members based on the idea that God completed his creation on the 7th day. With this in mind, one would have to conclude that this propaganda is for church member consumption.)

Part Four.


Herbert W. Armstrong.
Not your everyday
run of the mill martyr…
according to Stan.







Stanley Rader goes head to head with Mike Wallace!

Chapter 13: The Plain Truth About “Sixty Minutes”

Mike Comes Calling

On April 15, 1979, some 35 million viewers of the CBS-TV “Sixty Minutes” show were seduced into believing they would be given a firsthand peek into alleged corrupt goings-on in the world of religion. “God and Mammon” was the title of the show, and host Mike Wallace, in sonorous and doleful voice, promised a “tale of backbiting and power struggle, of fat expense accounts and disinheritance.” Instead, the audience got a thoroughly distorted picture, slickly tailored to fit the preconceived line that Wallace, his producers, and staff had concocted.

What is not generally known is that the fifteen-minute segment, which also included interviews with Garner Ted Armstrong and Hillel Chodos, was culled from four and one-half hours of discussion during which, unhappily for Mike, his thesis was thoroughly demolished. Cut from the show as seen on TV were the real facts, freely offered, which would weaken or destroy the point he wanted to make. Of even greater import — the tape on which he based many of his questions was not only illegally obtained but also represented as one document two letters written on separate occasions.

In order to understand the “plain truth” about “Sixty Minutes,” we should go back to our first involvement with its representatives. In October 1977, I received a telephone call from one Norman Gorin, who identified himself as an executive producer for the show. Gorin said that Garner Ted Armstrong’s immorality had come to his attention and he planned to do an episode about it. When I queried him about how these matters had come to his “attention,” his replies convinced me that his information came from people who were feeding him lies and gross distortions about the Church.

Consequently, I told Mr. Gorin that neither I nor any responsible member of the Church would give him an interview. Verbally, and later in writing, I informed him that most of his information was untrue, warned that use of it on his program would be construed as evidence of malice and, if it was aired, we would institute suit immediately.

The main thrust of that projected program would have been an “expose” of Garner Ted, who would be centerpiece of a story about alleged unsavory activities within the Church. It was clear that the proposed segment would in no way reflect the truth of what the Church was seeking to accomplish; moreover, I felt it essential to protect the Work by protecting Garner Ted from public exposure.

Gorin seemed to drop the matter until the California attorney general put the Church on the front pages of the newspapers again. A little more than a year later, I received another message from Gorin. I didn’t reply because I felt his attitude and information were still the same.

In mid-January, Wallace himself telephoned. He was staying at the Beverly Hills Hotel, en route to Thailand, and wanted to discuss a possible show. I told him I still wasn’t interested and that Mr. Armstrong would never be interviewed. Mr. Armstrong believed Time Magazine had distorted his views in 1972 and intended never to grant another interview. Wallace pleaded that 1, at least, see him for a short time. I finally agreed and met him that evening at La Scala, a restaurant in Los Angeles. I had already put in a full day in court, followed by hours of consultation with our lawyers.

At dinner, Wallace told me the focus of the program. The story, as he now saw it, had shifted from emphasis on Garner Ted to an exploration of the Constitutional issue of separation of Church and State. As a responsible member of the press, he expressed himself as deeply concerned about violations of the Firsy (sic) Amendment. He led me to believe he felt we had a mutual interest in judicial and other Constitutional guarantees; he promised a balanced presentation.

On that basis, I agreed to the program. “Mr. Armstrong will never see you,” I told him, “but I’ll be very happy to go before your cameras in any setting. I have nothing to hide, never have. You can ask me any questions, and as long as it doesn’t reflect upon anyone else, I’m going to give you straight answers.”

That was the way I had been treating the press all along, often astonishing them with frank statements. For example, a few days earlier one of the reporters had asked me, “You live in a million dollar home, don’t you?” “No, not at all.” I said. “It was a two-million-dollar home, actually, the finest dwelling in Beverly Hills. I take umbrage when you say just a fine home.”

I told the reporter that when Walter Annenberg returned after serving as U.S. ambassador to Great Britain, he wanted to buy my home. He offered me $1.2 million and was surprised when I turned it down. I wasn’t embarrassed by the question and answered it fully.

I told Wallace that he could film me in my office, in the auditorium, on campus, at a press conference, or wherever he chose. However, I stipulated that the program could not be televised until the entire interview had been completed and a written release obtained. “I have nothing whatever to hide,” I repeated, but said quite frankly: “I have to tell you I’m not convinced you are a completely responsible member of the press. I’ve talked to many media people and they feel as I do. You impress me as a journalist whose primary aim is to entertain rather than inform the public.”

When the interview was over, I said I would know whether he was really serious about presenting a balanced picture. Allan Browne had joined us for dinner and I insisted he be present during the filming. Wallace agreed to the rules. I soon discovered he had never wanted Herbert Armstrong and actually was training his guns on me, but wasn’t about to present it that way. I agreed because I realized he would be doing the story with or without me anyway, and it was to our advantage to get into his hands the information that would tell our side of the story. Mr. Armstrong, of course, was totally convinced that Wallace lacked integrity and was far worse than most legitimate journalists working in print or even television.

On February 7, 1979, my office was transformed into a television studio and the interview with Wallace began. It was about six weeks after the start of our problems with the attorney general and proved just about the only bright moment of those dismal days. For the first three and a half hours, the redoubtable Mike floundered from one disastrous point to another.

Each time he asked a question he thought might prove embarrassing to me, he got an answer, but not one he apparently expected. He made the mistake of trying to trip me up on my own documents, an absurdity considering that I had been living with them night and day and he had barely done his homework on any of them.

I discovered as the interview progressed that Mike Wallace’s vaunted reputation as a sharp interviewer who can pinion a subject with a quick feint and a thrust to the heart was vastly overrated. He is neither bright nor fast enough in his thinking to match wits with persons trained to pick up nuances and spot in a moment of time every flaw in a presentation. We may say, charitably, that that sort of thing is not his field of expertise; he is an entertainer, not a brilliant legal cross-examiner. (Editors note: I detect narcissistic tendencies in Stan. What he is saying is that in no way can Wallace get over on him. He’s to damned smart for that to happen!) 

In the introduction to his television show, Wallace promised the story of a Church “whose one hundred thousand members each year contribute eighty million dollars. “And that is more money than is collected by Billy Graham and Oral Roberts combined,” he said. “It is the story of Herbert W. Armstrong, founder of the Worldwide Church of God; of his son, Garner Ted, once thought of as heir apparent, who has now been cast out of the Church by his father, and of an unlikely Church figure, an accountant, lawyer, and businessman, chief adviser to Herbert W. Armstrong, Stanley Rader. Finally, it is the story of how the state of California is now trying to hold the Worldwide Church of God accountable for all the tax-exempt money that pours into its Pasadena headquarters. The California attorney general wants the Church to open its books so they can find out if Herbert Armstrong and Stanley Rader have been siphoning off Church money for their personal use.”

The show proceeded. But 35 million persons in the television audience saw and heard a sharply edited, doctored-up version of the interview that had taken place. A number of my statements, central to the understanding of vital points, were eliminated completely. (One recalls with a shudder the eighteen-and-one-half-minute gap in the Watergate tapes!)

The facts about the actions of the attorney general, his reasons for the takeover and the aims of the receiver and his aides were explained. None of this was aired. Other explanations were shortened or spliced into footage out of context to create a picture of the Church that was contorted out of all resemblance to reality.

Bits and pieces from the lengthy interview, covering Church holdings, expense accounts, and charges by dissidents were excised and reassembled cleverly to advance the “Sixty Minutes” portrayal of Church leaders as greedy and corrupt and the Church itself split by dissension. To illustrate how this was done and to reveal — perhaps for the first time — the technique employed by this popular program in presenting material, I have gone back to the original interview to show the reader what actually was said in key passages.

What follows demonstrates all too plainly that the version seen and heard by 35 million persons that Sunday bore little resemblance to what had actually taken place in my office in February. *


What 35 Million People Were Not Allowed to Hear

 WALLACE: Mr. Rader, why is the Worldwide Church of God apparently in such turmoil right now?
RADER: Well, I don’t really feel that the Church itself is in turmoil. I think that the state of California has brought an unjustified legal action against the Church that has caused us some difficulty.

* I had taken the precaution of having the interview taped by our own personnel. The text has been edited solely for clarity and elimination of repetitive speech patterns. (Editors note: Why not play the recorded interview in church and set the record straight? Are we to trust him to tell the truth? Truth from a lawyer?)

WALLACE: Why would the state of California be interested in causing trouble, if you will, for the Worldwide Church of God — you do good work?
RADER: Of course we do. And that’s what makes their action so unconscionable. But, you must look at the composite picture at this time. You not only have the state of California acting through the deputy attorney general but you have a small group of dissenters who would like to change the government of the Church from a hierarchal system to something like a congregational system. Then you have some people such as the plaintiff’s lawyer and others who would like to be receiver who are in it strictly to make money.
WALLACE: The receiver is in it to make money?
RADER: The whole receivership business is a money-making business. They are the vultures of the economic world.
WALLACE: Wait a second. About whom are you speaking specifically?
RADER: I’m talking about the receiver.
WALLACE: Judge Steven Weisman, who just resigned…
RADER: Judge Steven Weisman, who just resigned as receiver, was what we considered from a Church standpoint as an abomination. But besides that, he was an economic vulture. He came in here and the first thing he did is he took $150,000 of our tithes and put it into his own pocketbook.
WALLACE: Well, that was at the rate of $150 an hour, I believe.
RADER: That’s right.
WALLACE: He was appointed by the court; he didn’t just come in of his own free will and accord.
RADER: No, but he was hand picked.
RADER: By plaintiffs counsel.
WALLACE: And when you say plaintiff’s counsel, you mean the deputy attorney general, Mr. Tapper, and Hillel Chodos, who was deputized as an attorney general.
BROWNE: Right.
RADER: Well, Mr. Tapper would have had to approve Mr. Weisman as the receiver. Mr. Chodos, on the other hand, undoubtedly picked him deliberately out of all the other possible receivers.
WALLACE: Ah! Weisman, for the purpose of?
RADER: Perhaps helping Mr. Weisman. Mr. Weisman is a retired judge, had never had a receivership before, had been seeking work of this kind for some time in the community.
WALLACE: Are you suggesting that Tapper, Chodos, Weisman, are in cahoots, if you will, to milk the Worldwide Church of God for their own benefit?
RADER: I am more than suggesting, I’m stating it emphatically so no one can misunderstand it.
WALLACE: That this is a money-making operation for Chodos, Tapper, Weisman?
RADER: Not Tapper. Tapper is a deputy attorney general, he has his own problems that he’s going to have to account for. Chodos is in it for the money as was the receiver. And the dissident group, I think we will find out, is a small group, a very small group of Church members.
WALLACE: Well, now some people who are not in the so-called dissidents group, who are also disenchanted, say, “Why don’t we simply open up our books? We have nothing to hide.”
RADER: I say that. And I certainly am not a dissident. I’ve opened up the books of this organization eight separate times to the Internal Revenue Service, eight separate times, and received a complete bill of health. And they start with the same basic question “Are you a Church and are you continuing to operate exclusively for the purposes for which you were established The last time the IRS was here, they stayed eighteen months looking over everything.
WALLACE: And you got a clean bill of health?
RADER: A clean bill of health.
WALLACE: So you are satisfied that there are no financial improprieties involved.
RADER: None. It’s a red herring. A total red herring. And everyone who has been responsible for bringing those false allegations will rue the day that they did.
In his questioning, Wallace referred to charges that Herbert Armstrong was old, almost senile, hinting that was the reason lie would not be interviewed.
WALLACE: One hears that today at the age of eighty-seven, almost eighty-seven, that he is not as completely in charge of his faculties as he was, say, ten or fifteen or twenty or twenty-five years ago?
RADER: Totally untrue. The man is in total command of all of his faculties. He writes today more prolifically and more powerfully than at any other stage of his life. He has produced more radio programs in the last seven months than his son had done in a two-year period immediately preceding it. He is making radio programs; he has written two complete books, one which will be published this month, one which hopefully will be published by May and three others which will be published in the fall. All of this at the age of eighty-six, going on eighty-seven. He’s traveled to Israel, he has traveled to Florida, he has traveled to Texas; he speaks once or twice a week.
WALLACE: Will he sit down and talk to us?
RADER: No, Mike, as nice a guy as you are, Mr. Armstrong has a very definite feeling about any representative of the press. I don’t think it would be good for me to repeat everything he says but he doesn’t exactly like them.
WALLACE: I gather that he has an attitude somewhat akin to Richard Nixon’s.
RADER: Much worse, much worse.
RADER: Because he has studied the press longer than Richard Nixon.
WALLACE: And distrusts the press.
RADER: He distrusts their motives, he also questions their ability and their sincerity.
WALLACE: Do you?
RADER: I… let’s put it this way: My experience is beginning to be much as his has been for some fifty, sixty years. But, I’m still willing to give the press an opportunity to prove itself as really a fourth estate.
WALLACE: Well, then why, if you have this much confidence in Herbert Armstrong, and Herbert Armstrong despises and distrusts the press, why are you sitting down with me?
RADER: Because, as I said, I am a slow learner and Mr. Armstrong gives me a chance to make mistakes because he feels I like everyone else must build character. The only way I can build character is by making mistakes.
WALLACE: So, in effect, you will not let the American public have the opportunity for an interview.
RADER: He won’t.
Wallace sought to “prove that the Church is tyrannical and a “cult” — that we throw people out without a hearing.
WALLACE: Herbert Armstrong, in effect, has the right to do with the Church what he wants.
RADER: You bet your life. You bet your life because he is responsible and accountable to God.
WALLACE: Therefore that makes it a cult.
RADER: Not at all. Mr. Armstrong is accountable to God as all of us individual members are.
WALLACE: But a cult is led by one man. There aren’t by-laws, there aren’t rules, there aren’t boards, there aren’t…
RADER: Mike, Mike, I’m surprised at you. You are a very informed man. You’re a very cultured man. Would you say that of the pope? I don’t think so.
WALLACE: But there are bishops and there are cardinals…
RADER: Ask them the last time they opposed the pope?
WALLACE: But they elected the pope. The pope did not elect himself.
RADER: Fine, fine, But who elected the first pope?
WALLACE: Who elected Herbert Armstrong?
RADER: Mr. Armstrong has served as Christ’s apostle for forty-six years. By the constant approval of his members, day by day, week by week, year by year, he has proved that he is the only person worthy of that office. And there is no person within this Church who would ever for a moment think otherwise.
WALLACE: He is self-appointed, and he makes the rules.
RADER: The foundation of all of our knowledge, secular as well as spiritual, is found in the Bible, which we consider to be the written, inspired Word of God. If it isn’t there, we don’t follow it. If it is there, we do it.
WALLACE: Why are some people afraid of you, Stanley Rader?
RADER: I don’t know, Mike. My wife says I have a very beautiful smile and don’t use it enough. Maybe I’m always asked to speak about very serious things. And maybe I appear to be a little bit harder than I am. But the brethren, I’ve found, Mike, like me very much.
WALLACE: In talking to the dissidents who brought the suit against the Church, I find they are people who have been members of the Church for a long time. They say that there is a huge power struggle going on in the Church between, on the one hand, Stanley Rader and the people who are his allies, and on the other hand, Garner Ted Armstrong and people who are his allies. They are simply people who feel that the Church has lost its way, and it spends too much money for things of no consequence, for things that are unworthy.
RADER: Well, you’ve got many questions there. First of all, the Church spends its money in accordance with God’s will and purpose of propagating the Gospel of Jesus Christ as a witness unto all nations, according to Matthew 24:14. Whatever we do is done for that purpose.
There were many questions concerning expenses, with Wallace charging amounts spent were “incredible” and “money was being thrown around.” I informed Wallace emphatically that all monies spent were to propagate the message of the Living Christ. Church members, I said, were kept fully advised about our expenditures and the amounts did not surprise or embarrass me.
WALLACE: Who is Professor Osamu Gotoh?
RADER: Gotoh, Gotoh, G-O-T-O-H.
WALLACE: Who is he?
RADER: Acronym for Go To Heaven. He’s a very interesting man. At one time he taught Japanese here. He later became a baptized member of the Church and by 1968 had been hand-picked by Mr. Armstrong to ultimately head the entire Japanese effort that we would undertake sometimes in the future.
WALLACE: He is a professor where?
RADER: At Ambassador College.
WALLACE: He used to drive a cab, I am told, in Tokyo.
RADER: He might have in 1945 or ’46 when he was about twenty-one, twenty-two years old, but I wouldn’t hold that against him. I know some very fine people who served in cafeterias. I’ve had to watch the fraternity boys while they danced.
WALLACE: Let me run down some expenses for Professor Osamu Gotoh: July 1st ’76, April 30, 1977 — travel and lodging expense, July, $9,000; August, $38,000; September, $25,000; October, a mere $4,000; $12,000 in November; $30,000 in December; $23,000 in January; $14,000 in February; $13,000 March; $12,000 April. Thousands of dollars. That’s just travel and lodging. Public relations expenses totaled during that time, $174,000. Monthly credit card expense, $358,000 total during that time.
RADER: That must have been a slow period.
WALLACE: Tokyo AICF allocation, that’s for the foundation, $50,000. Grand total in the ten-month period, for Professor Osamu Gotoh — $415,000, for what?
RADER: What year was that?
WALLACE: 1976 to ’77. July to April.
RADER: Probably a slow year, Mike. I could probably show you years where he spent more than that. See, he was in charge of Mr. Armstrong’s entire overseas evangelistic effort. He arranged everything.
WALLACE: In Japan?
RADER: No. Worldwide.
WALLACE: $415,000 in ten months is an incredible sum.
RADER: Mike, Mike, you’re making it sound incredible. You know better. This is the very type of thing you talked about before. What do you think it cost Billy Graham to go around the world on his evangelistic efforts? Why don’t you ask Billy, “Billy, what does it cost you to go to Manila?” We went there first, you know. We had 25,000 people there every night for three nights. What do you think it cost to get 25,000 people into that stadium? It cost money for public relations, it cost money for advertising. it cost money to rent the place, it cost money for the entertainment, it cost money for the banquets, it cost money to get people there. You know that, you know that as well as I do.
WALLACE: Are you suggesting that he, Herbert Armstrong, held this kind of meeting, revival meeting, that Billy Graham…
RADER: Exactly. I mentioned Manila because we were the first.
WALLACE: The meeting was held in Manila, over how many nights?
RADER: Three nights.
WALLACE: At a cost of.
RADER: Oh, I don’t know, I’m just saying that’s the type of thing that Mr. Gotoh did for us. We had those campaigns around the world. That’s what Mr. Gotoh did. Then he picked up the tabs for all of it.
WALLACE: He picked up the tabs for all of what?
RADER: For all of those expenses. Everything from ground transportation to hall rental. Airplane fares for himself and other people, gifts, you name it, he did it.
WALLACE: So you were well satisfied with the work that Professor Gotoh did?
RADER: I was well satisfied. Mr. Armstrong, more importantly, was well satisfied. Mr. Armstrong said repeatedly that he is, has been, a very valuable member of the team.
WALLACE: Who is Dr. Singh?
RADER: Dr. Nagendra Singh is a member of the International Court of Justice at The Hague. Prior to that time he was the secretary general to the president of India. He is a member of one of the leading families of India.
WALLACE: Dr. Singh is an important man to you people?
RADER: Dr. Singh is an important man to the world. He’s a man who stands for peace and he embraces all of mankind. He is a very transcendent man.
WALLACE: Why would Gotoh pay for Dr. Singh, $8,000 TWA, a trip from Amsterdam to Tokyo and back?
RADER: Dr. Singh appeared in Tokyo on behalf of Mr. Armstrong. He also appeared in Nairobi on behalf of Mr. Armstrong. He appeared several times in New York on behalf of Mr. Armstrong
WALLACE: This is simply Amsterdam, Tokyo, Amsterdam.
WALLACE: $8,000.
RADER: Amsterdam is where he was based, at The Hague. The airport for The Hague is Amsterdam. He went from Amsterdam to Tokyo to appear on Mr. Armstrong’s behalf on the platform, introducing Mr. Armstrong, then he returned. He went with his wife back and forth. Two round. trip tickets, first class. He’s a member of the International Court of Justice at The Hague.
WALLACE: Ambassador Mugo?
RADER: Ambassador Mugo at the time was ambassador from Kenya to Paris. He was helpful to us in working with, not only the black nations in black Africa, but also because he was ambassador from Nairobi to Paris. He also covered the Vatican and he covered Yugoslavia and Italy. And he was very instrumental in helping us to meet other emissaries from those black African nations.
WALLACE: Ambassador Mugo expense — Regency Hotel, September 1, 1975, $5,393.
RADER: We pay for …
WALLACE: Just a moment. Gotoh, TWA, again for Mugo, $19,000 to TWA, August 20, 1975.
RADER: That’s for Mugo and his family, a large family, with four children. They were invited by Mr. Armstrong to visit the United States, to visit Ambassador College and to make appearances with us in various places in the United States, helping us in our efforts to extend a helping hand to the black African nations.
WALLACE: December ’75 — Gotoh’s hotel bill in Switzerland on American Express — $6,324.
RADER: I don’t know what you mean. Should it be $8,000, $12,000 or $2,000? It doesn’t mean anything.
WALLACE: It’s an expensive bill is all I’m suggesting.
RADER: Mr. Gotoh has very good taste and Mr. Gotoh was an ambassador to the rest of the world from the Church.
WALLACE: American Express — Gotoh — December 24, 1975. Hilgie’s in Paris, $2,237.
RADER: Mr. Gotoh was Japanese. If you know the Japanese customs of doing business, you would find that the Japanese like to bear gifts and this was one of the things we could never break Mr. Gotoh of doing. He didn’t buy expensive gifts, he bought many small gifts. He liked to go into an office, whether it be an office of a minister of the government or president, with something. Sometimes he would give a pen. Sometimes he’d give a scarf. This was his way of making himself a little bit more acceptable.
WALLACE: Diner’s Club — Rader — February 25. One, two, three, four, five, six, seven, eight, nine, ten bills paid on behalf of Rader to the Hilton Hotel in Jerusalem that come to something over $ 10, 000 on one day.
RADER: We had very, very large banquets there. All you’d have to do is call any one of your friends in Israel and they’ll let you know that we entertained all the dignitaries of the state. We would take the leading members of the government, academia, industry, and the people and we’d bring them all together. Mr. Armstrong would speak and we’d have a chance to get out our announcement.
The following colloquy developed when Wallace questioned a $12,000 expenditure by Armstrong for six crystal pillar griffins of Steuben crystal, earmarked “gifts.”
RADER: Did you know, Mike, that Dwight Eisenhower was president of the United States for eight years and every time he visited a head of state, he gave a piece of Steuben? Did you know that?
WALLACE: Are you suggesting that Herbert Armstrong is a head of state?
RADER: Exactly.
WALLACE: And you’re his secretary of state?
RADER: You’ve got it. By God, you’ve got it, Mike. That’s the whole key. And it only took you an hour and a half to get there. That’s the whole key. This is a state and we are representatives of God and I am Mr. Armstrong’s secretary of state.
WALLACE: And who elected Herbert Armstrong?
RADER: Mr. Armstrong had the great commission devolve upon him forty-six years ago.
WALLACE: And he runs, in effect, a dictatorship?
RADER: Yes. But it is a benevolent dictatorship. And he has the respect, the admiration, and the love of the people.
WALLACE The people who tithe, and tithe again, and then third tithe, and special offerings…
RADER: They love him, Mike. They love him and there’s no man or combination of men that will ever destroy that love, that respect, or that admiration. Never. It will never happen.

One of the lighter moments, in the interview came when Wallace, apparently too vain to wear his eyeglasses while on camera, had difficulty understanding one of our financial papers, confusing fiscal with calendar year. I began to chide him.

RADER: Mike, you’re not reading it. Mike, come on. You’ve got to read the top. My goodness. You don’t want to make me cross examine you on national television. This is for a twelve-month period or a fiscal year. So through December 31 we already had spent $258,000.
WALLACE: If it’s a fiscal year, conceivably, one should perhaps say so.
RADER: You can see it right there. Mike, put your glasses on. 1977 to 1978 Budget, July I through June 30th. This is as of December 31. We’ve already spent $270,000 in half a year.
Wallace began to delve into salaries and expense accounts in an attempt to shock and embarrass me. He did not succeed. I even upped his figures a little! I also told him pointedly that all of these expenses were known to the members. Much of my explanation was never heard on the air.
WALLACE: How much does Herbert W. Armstrong make?
RADER: He doesn’t make as much as I do. You should ask how much I make. I don’t like to tell you things about Mr. Armstrong. Ask me what I make, and I make more than he does.
WALLACE: You make $200,000 a year.
RADER: $200,000 plus.
RADER: My entire employee benefit package will bring me closer to $300,000.

(Editors note: $300,000.00 in 1978 had the same buying power as $1,142,632.85 in 2016)

WALLACE: $300,000!
RADER: Closer to three than to two.
WALLACE: And he.
RADER: Makes less.
WALLACE: $200,000?
RADER: That’s right.
WALLACE: Expenses?
RADER: Just those expenses which are part and parcel of his overseas mission.
WALLACE: On those expenses? Everything else comes out of the $200,000?
RADER: He pays for his own. He pays his own way through the world.
WALLACE: He does. I have here a copy, February 7, 1978, subject — Herbert Armstrong, medical. From Edward Bodo to Henry Cornwall. Mr. Armstrong’s medical expenses.
RADER: We’re self-insured.
WALLACE: $6,000
RADER: Mike, I have to explain that because you’re just going to go down a bad trail and I’ll have to ask you to put your glasses on. We don’t have medical insurance. We’re self-insured. So for the first time in forty-six years, Mr. Armstrong became ill and we paid his medical bills, just as we’ll pay them for anybody else under our self-insurance program.
WALLACE: Here are checks given to Mrs. Armstrong, $20,000.
RADER: They were probably for the expenses for what became a paramedical unit.
WALLACE: Medical reimbursement requested by Mr. Raderno receipts — $3,112.
RADER: Remember, Mike, Mr. Armstrong became ill in August of 1977. He would not go to a hospital. He refused. He had round the — clock medical attention — three nurses around the clock while he was in his critical stage. After he recovered from that it was cut down. But we did have to turn his home into a paramedical facility.
WALLACE: So these are all medical expenses?
RADER: Medical expenses.
WALLACE: Aren’t they extraordinary for Herbert Armstrong?
RADER: They are extraordinary in the sense that this is the first time Mr. Armstrong has ever called upon the institution to honor its self-insurance program.

(Editors note: The wcg was self insured to pay for the medical costs of who?)

WALLACE: Other expenses he takes care of?
RADER: Yes, unless they are expenses of carrying out institutional activities in which…
WALLACE: Pasadena Pet Hospital — $25. Pet Corral Dog Food — $12. Pet Corral White Rocks — $.93. T.V. Guide — thirty-one cents. Book for Mr. Armstrong — $ 2.39. Handcocks fabrics$2.33. Ben Monte Market — $33.41. Grand Champion Feed Store — $26 and $21. Levis — $25.00.
Groceries, hardware, cigarette lighter connector plug — $1. Molding, shelves, wood, jalousies, frames, pool cleaning, Lifetime Book, Just Pants, The Spot Shop — $2,565.72. These are non medical expenses for the household of Herbert Armstrong during 1977.
RADER: What you don’t understand is those items are then picked up on our books and records and charged to his accounts receivable and then he reimburses it. [Emphasis added.] We have a very fine system of accounting. The mere fact that you have all those items indicates that we have a fine system. If we didn’t have that system, we’d have some kind of system that other institutions have where you wouldn’t be able to treat that kind of deal. This information is accumulated. It is charged to his accounts receivable. At the end of the year he pays it.
Wallace returned to a discussion of my salary and benefits, claiming that I was a “rich man.”
WALLACE: I would say with a $200,000 a year salary, a $100,000 a year expense account and a consultant fee of $100,000 a year after retirement according to your contract which runs to the year 2003, you’re a rich man.
RADER: That makes me well paid, doesn’t necessarily make me rich. You can’t count the money in my pocket, Mike.
WALLACE: I can’t count the money in your pocket. I can count, however, the amount of profit you made on the sale of your house on Loma Vista.

Here, he questioned who made the mortgage payments on Loma Vista, sold at a profit to me of $1.2 million, trying to prove that Church funds were being used. He also seemed concerned that I was not paying my share of taxes. I answered frankly but, as we will see later, may not have convinced him.

WALLACE: Mr. Rader, you say that you paid totally for that house in which you realized a profit of $1,200,000. I have here your executive expense report from January 1, 1977 to December 31, 1977, which says, house payment, $28,000. Apparently somebody was paying $2,406 a month on your behalf.
RADER: There’s nothing inconsistent in that. You asked me a few moments ago whether my salary under my contract was $200,000. I said yes, plus employment benefit packages. As a convenience to me, the Church, when I was traveling, and I was traveling up to three hundred days a year, made those payments on my behalf. That is additional compensation as part of my package provided for by my contract. They issue a 1099 form at the end of the year along with a W-2 pick it up on my tax return, and I told you if you took those payments plus my $200,000 a year, it comes closer to $300,000 than $200,000.
WALLACE: Why don’t you have a $300,000 salary?
RADER: I do.
WALLACE: Do you pay taxes on a $300,000 salary?
RADER: I just told you that. A total of $200,000 comes on the W-2 form and the balance of it comes on a 1099 form and I pay tax on it. If I were a minister, those payments over and above my $200,000 would not have been taxable to me. They would have still been for my benefit, but they would not have been taxable. This is part of my employment benefit package. I pay tax on the whole thing. It is what this organization has determined I am worth. They paid it to me or on my behalf. Therefore I paid for my house. I pay for everything else I own.
WALLACE: Is there some place in your employment contract that says you are entitled to that?
RADER: Yes, of course. In paragraph 3.3 and paragraph 3.2. Both points.
WALLACE: Paragraph 3.2 and 3: “Expenses. Church shall pay for all expenses incurred by or on behalf of Rader in performing as chief adviser, including but not limited to all travel, lodging, entertainment, and meal expenses. So that all out-of-pocket expenses incurred by Rader in the performance of his duties as chief adviser shall be promptly reimbursed.”
RADER: My home, in other words
WALLACE: And then 3.3, his fringe benefits: vacations, sick leaves, employee group insurance and other fringe benefits. It says nothing about paying for your home, though.
RADER: The fringe benefits include the same benefits for me as I told you exist for the ministers — exactly the same.
WALLACE: In other words, the ministers can sell their house at a profit?
RADER: Those who own their own homes.
WALLACE: How many of them do?
RADER: Many. And those who own their own homes can receive benefit payments for the maintenance of the home and they won’t even be taxable on those payments. If they should sell their home, the home naturally belongs to them. This is very open and shut. It’s a very simple, basic thing.
WALLACE: Why would this payment not appear as salary but as executive expense report — House Payment, $28,000?
RADER: That’s exactly what it is. It’s executive expense report. It’s not salary. It’s not subject to withholding tax, per se, but the laws of the land require it to be reported on a 1099 form.
WALLACE: Oh, then you don’t pay a tax on it?
RADER: I pay it. I pay it on my income tax return because it’s reported to me as earnings other than wages on what’s called Form 1099.
WALLACE: I just want to understand something. Do you pay an income tax?
WALLACE: On $300,000 a year?
RADER: Closer to $300,000 than any other number you could pick.
WALLACE: Including the house payment?
RADER: Exactly.
WALLACE: Who pays those taxes for you?
RADER: I do. I do.

After more than four hours, I walked angrily out of my office, abruptly terminating the interview, when Wallace introduced what he said was a tape of a conversation Herbert Armstrong had with a third, unidentified party.

I did not object to the substance of what he was presenting I had already made all of it public myself, both in court and in the Worldwide News. But I was appalled at the unauthorized and illegal taping of Herbert Armstrong. The offense was magnified, I felt, because two tapes made at different times were spliced to appear as one! As he played the tape, I caught the discrepancy. Part of it was excerpted from a seven-page letter written by Armstrong to me. The other half, I surmised from the contents, must have been taped some months earlier. Wallace led into this discussion by asking if I knew I had been the bete noire of Armstrong in early January. He quoted what he said was a letter from Armstrong and, when I denounced it as a “fabrication,” proceeded to play the tape. Only a very small portion of what I actually told Mike Wallace was broadcast. Here is the complete exchange:
WALLACE: There’s no doubt in your mind that that’s Mr. Herbert W. Armstrong?
RADER: There’s no doubt in my mind that the second half of the tape was his reading of a letter which I referred to in court. It was addressed to me as a result of an exchange of letters that I had with him beginning in October, when I had asked him to relieve me of these administrative responsibilities. I said if he wanted to, although it wasn’t true, he could use my health as a reason. In December, as a matter of fact, as a prelude to this, taking my suggestion, he wrote to the entirety of the Church and told them that I was thinking of resigning because of poor health. But you don’t have the whole tape there’s — a seven-page letter. *

* The letter is reprinted in its entirety in Appendix D. Refuting the Wallace charge that Mr. Rader was the “bete noire” of Mr. Armstrong, the letter includes the Pastor General’s statement that “I do want you and need you to continue as my personal assistant and adviser.” (Editors note: The Painful Truth will make this alleged letter available in Part V)

WALLACE: We have the whole tape.
RADER: Now that tape was illegally acquired. It must have been recorded by Wayne Cole.
WALLACE: You said that you did not believe that Herbert W. Armstrong would have said those things about Stanley Rader.
RADER: No, that’s not…
WALLACE: Now you admit…
RADER: That’s not what I had…
WALLACE: That’s what you said, Mr. Rader.
RADER: Oh no. Oh no.
WALLACE: And now you acknowledge that is his voice.
RADER: I didn’t say that. Those are two parts of two different tapes at two different times. The first part of that tape might have been five or six months old. You stated, Mr. Wallace, you stated…
WALLACE: Stated what?
RADER:… right here that, would I believe that just a few weeks ago I was Herbert Armstrong’s b6te noire? The second half of that tape does not suggest that. The first half of that tape does. Now I say you’ve acquired this by illegal means. I intend to have my attorneys today not only sue you if you use this, but I mean this now. I want you to go to the district attorney today. Let him know that Wayne Cole improperly recorded this. I’ll defend Mr. Armstrong and the Church on that basis. This is obviously something that was recorded by Cole. Remember, Cole went there as part of the conspiracy on December the 28th. I have a copy of the…
WALLACE: I must say that you’ve had your attorney here during this entire interview, and you’re addressing him, Allan Browne, at this moment.
RADER: At this point, I want it known that you have been given a tape illegally acquired in violation of the California wiretapping laws, and perhaps some federal laws as well. I’m not sure of that. I’m sure the party that Mr. Armstrong — , was talking to was the party that addressed the letter to him on December 28th, which Mr. Armstrong alludes to in part in the actual letter, which I have a copy of, and which I’ve been willing to produce in court, and which I read to the entirety of the Church a couple of days after I received it. But that’s no secret.
WALLACE: Mr. Rader, you know what I’d like to know is why all of this backbiting and fighting and money and power and trouble? Why all this storm and brine in the Worldwide Church of God? What kind of people are you? Are you for God? Are you for, are you for, are you a godly man?
RADER: I am, and Mr. Armstrong is. I’m wondering about you, Mike? I’m wondering about you.
RADER: Because you have used a piece of a tape that’s a fractured tape. You know it was illegally acquired. I find it reprehensible and unconscionable. And if there is anything I can do to see to it that you do not have access to that kind of material ever again, I shall do so. So I want you to know that. Whether I don’t know whether…
WALLACE: You’ve made that clear.
RADER: No, no. Not just for me. You have used a tape, and I have to tell Mr. Armstrong now, his contempt has always been real. But on a scale of zero to 100 you’ve now come close to 98. You have played that tape in front of other people here. It’s a fractured tape.
WALLACE: The only other people here are our staff and your attorney.
RADER: That’s not privileged, not privileged. I feel that a great injustice has been done to the spiritual leader of this Church. I’d like everyone’s name, including these staff people. and Gorin as well. If necessary, I’ll go to court and get an injunction on the whole bit, just on the basis of that tape because the head, the spiritual head of this Church…
WALLACE: Why does that tape worry you so?
RADER: It worries me only in one respect, that a person coming here as a supposedly responsible member of the press, representing a responsible entity such as CBS, knowing he has a tape illegally acquired, would use it in front of other people. That, to me, is reprehensible, Mike. If I had known that, I’d have never let you step foot on this property.
WALLACE: You mean, you mean?
RADER: The contents mean nothing. It’s the fact that you have received it illegally. I warned you that some of the papers you have on the floor were stolen from this office by Ted Armstrong. I told you that. And I told you we’d already told the deputy attorney general, as well as the receiver, that he’s on notice about those papers. When you asked me about other papers, which were mine, I said they weren’t stolen from me. They were probably taken from this office. This violates Mr. Armstrong’s rights of privacy, his human dignity. And you have been a party to it and you should be punished for it.
WALLACE: What about the substance?
RADER: I told you that I would be very happy to give you a copy of the seven-page letter that he wrote to me…
WALLACE: No, the substance of that tape?
RADER: That tape is not a complete tape. There is a seven-page letter. I’ll go to any court in any land and prove to you that the tape is not a complete record. I’ve already made the letter public to the entirety of the Church and it’s been printed.
WALLACE: The tape is nothing more than what I read to you beforehand, and you said it’s impossible…
RADER: There were two tapes.
WALLACE: I say the tape is nothing more than what I read to you ahead of time. And you said at that time it couldn’t possibly be Herbert Armstrong.
RADER: I think you’d better scrap everything because now you’re on my list. You announce somebody, I have to go at. And I’ll have to stand every bit of our resources to get you because you have violated Mr. Armstrong. You have set the spiritual head of this Work up, you have violated every one of his rights of privacy by taking that illegal tape. You violated. You’re the receiver of something that’s improper. You’ve exposed it to these people here. And if it’s the last thing we do, we’re going to make you pay for it. Now I hope you print that on the air., It’s not running now.
WALLACE: We’re going to have to get it from.
RADER: Get it.
WALLACE:… for we want to get you saying that.
RADER: That’s very important. I mean, to me, it’s despicable. The contents, no. I’ll make them public. Today I’ll give the whole press the story. I’ll also give them the whole seven page letter and then let them compare what you have played with the seven page letter. But my seven-page letter is a letter from Mr. Herbert Armstrong. That was acquired illegally. And you’re using it, and you have involved these people — very despicable.
CBS STAFF MAN: We don’t know who else has heard that tape.
RADER: Many other people have heard that tape. That’s my entire point. This becomes major. It’s not minor. And I’ve got to go public with it. To protect Mr. Armstrong, I must go public. I mean, his letter to me has been published already. But what you have done, you have a tape recording which you have no right to have. You should have destroyed it as a responsible journalist; you should have destroyed it. You shared it with people here. That was despicable as anything I could think of. Mr. Armstrong will write a letter immediately about it to the entirety of the brethren. So the ball will start rolling as of today. It’s got to.
WALLACE: And will he disavow what he says in it?
RADER: There are major Constitutional issues involved here, and they border on the criminal. You have definitely violated criminal or penal codes of the State of California. There’s no question about it. You’re not privileged for having that tape. Now we’ve all heard it. I think it’s a very serious thing.

What he says in the second half of that tape was read — he was reading something to somebody over the phone. And I have the entirety of the letter. I’m not embarrassed about the letter, but the letter has to be read in the context of three letters from me that predated it, plus his letter to the brethren four weeks before, acting on one of my letters.
The Sham of “Investigative Reporting” By this time I’m afraid I had little Christian charity left in me for Wallace, so I terminated the interview and went to a waiting press conference.

Part Five. Conclusion.

The following is the promised Appendix D from Stanley Rader’s book, Against the Gates of Hell.

Appendix D

THE FOLLOWING is the complete text of the letter sent by Herbert Armstrong to Stanley Rader, from which the second half of the tape played by Mike Wallace was taken. In the letter, Mr. Armstrong reaffirms his total support of Mr. Rader.

“Dear Stan: I regret exceedingly having triggered the violent emotional outburst (that is putting it mildly) over the telephone last evening. Our personal relations together through the years have been too pleasant, stimulating and rewarding, and based on mutual esteem, loyalty and trust, to let anything come between us. I’11 certainly do my best to prevent any such outburst in the future.

I had been considerably distraught by things brought to my attention, or I should not have spoken so emphatically to Virginia. As I said on the phone, I am deeply sorry. Things have been brought to my attention that seriously threaten the very life of God’s Church and Work. I feel I must now candidly bring it to you. If ever I needed your help, Stan, it is now. You have been a faithful help to me in the Work that no one else could have contributed. Ted has been playing overtime on the rift between himself and you. I told you last spring that I felt I could come more effectively to your defense after I got the Church turned around and had built back my own credibility. I did accomplish that and sincerely, Stan, I’m sure that feelings that may have been aroused against your integrity, honor and loyalty have not disappeared, and I will continue to defend your good name as do you mine. But from a number of coordinators and field ministers as well as from Pasadena, I have learned that definitely the following situation does now exist, which could prove fatal to the Work unless cleared before the ministers’ conference.

I have the following report from the Office of Pastoral Administration: ‘Quite frankly, Mr. Armstrong, a very large number of members and ministers see only two choices for the future.’ The words themselves, you see, were not emphatic enough. ‘These two choices are Ted and Stan. Though many, most, actually, don’t want to leave you and follow Ted, they see the only alternative as following Stan, and they’d rather see Ted lead the Church than Stan.

‘To reinforce this attitude in the minds of our people, Stan is doing everything he can to present himself as next in line under you to run the Work in a purely physical way. It is common knowledge that Stan did not allow very much time to pass after Ted’s departure from his office before he, Stan, moved in. That office is part of the executive suite. It is seen as a symbol — the place for the man next to you in authority. Stan uses the underground Eara1e, and he uses your private elevator. It is a very common belief that very few, if any, people can get to you [this is the irony of error] to talk to you privately without going through Stan.

Mr. Armstrong, I could go on and on, but why? My point is that Stan and his prominent position in the Work is causing many people to stumble. This causes offense. God’s Word says that we who are converted and have a godly love for our fellowman will suffer even wrongly, unjustly [last words underscored, which I agree]. The apostle Peter said: “What reward is it when you suffer for things deserved?” But one is humble, is like a little child. He is willing and ready to suffer wrong rather than give unnecessary cause for offense and stumbling to others.’ “Stan, I know you have done these things to help and serve the Work and to help me.

I love you as a son, as you well know. I have accepted such things as moving into Ted’s former office as trying to most efficiently serve the Work. “But actually, the letter quoted above is mild compared to things I’ve heard from other sources. Certainly none of it is any reflection on your integrity. [Mr. Armstrong’s emphasis.] I don’t hear any more reflections against your good character. But I do hear that people believe you are pushing your way in to take over. “But no matter how false, God says we should avoid even the appearance of wrong and avoid causing little ones to stumble.

Even though I do not feel as if I were over 45 years of age, people do look at that 86-plus figure. And most people do feel that anyone past 60 is old, and past 70 is sure to die any moment. “I know and you know that I will go on living as long as God needs and wants me to live. But the little ones out there seem unable to see that.

I know, Stan, that this is the general attitude in view of the ministry, and brethren, generally, around the country. I have been assured of it from coordinators and ministers from widely scattered areas. And, although I think we have cleared any false charges against your personal integrity, they do look on you as an attorney, familiar with finance and business, and not as a shepherd over God’s flock. “So what I propose is this, that we go back to the status as it was prior to Ted’s departure, that you resign (see pic1, pic2) from administrative responsibilities in the Church and the college, but continue as vice president, executive vice president for the foundation, as my personal assistant and adviser, as our auditor, CPA and legal counsel, and of course, perhaps most important of all, continue with me in the great commission overseas.

It might even look better for the Church to pay you an annual retainer for legal counsel, financial adviser, etc., subject to additional billing where warranted, and the foundation to pay you also a salary or fee, as you think best. I do want you and need you to continue as my personal assistant and adviser, especially in projects such as our overseas work and marketing of my books. “Stan, I believe this will remove the last remaining serious threat to the Work of the great commission. I know that if we do what Christ leaves for us to do, and as I know He has led me in the above, the living Christ will preserve His Church and Work, will bless you and me and all in the Church and lead us to gloriously finish the great commission.

“With deepest love in Jesus’ name.”

From Ambassador Report (AR7) we are introduced to the class action suit against the WCG.

Dear Friends:
As most of you have undoubtedly heard, the Worldwide Church of God (WCG) is in the midst of its greatest crisis ever. Because of the complexity of the situation, we decided to delay our November-December issue until now. We have been following the momentous events of the last few weeks very closely. Here is what has transpired:

The Lawsuit

Since Garner Ted Armstrong’s expulsion from the WCG, many members of the church have become increasingly concerned over the rapid liquidation of church and college properties at a time when the WCG has claimed record-high income. Many deeply committed members of the church have been heartbroken to see college properties and church festival sites put up for sale while millions of tithe dollars are diverted to the costly world tours of Herbert Armstrong, the secular Everest House Publishing Company, Quest magazine, and other Ambassador International Cultural Foundation projects.

In late 1978 a handful of concerned WCG members obtained legal counsel about the matter and were put in contact with Hillel Chodos, a distinguished Beverly Hills attorney noted for his expertise in litigating major corporate fraud cases. A legal brief was prepared and presented to the attorney general of California. (Coincidentally, Ambassador Report, completely unaware that any of this was occurring, also contacted the attorney general’s office expressing concern over the same matters.)

The attorney general, working in close cooperation with Mr. Chodos, took immediate action. A civil suit was prepared listing the following plaintiffs: Earl and Shirley Timmons of Altadena, California, John and Paula Tuit of New Jersey, Ronald Quinlan of Staten Island, New York, and David Morgan of Pasadena, California. Also listed as a plaintiff are the People of California because monies contributed to nonprofit corporations are, by statute, deemed monies held in public trust and therefore subject to monitoring by the attorney general on behalf of the people.

Listed as defendants are: the Worldwide Church of God Inc., Ambassador College Inc., the Ambassador International Cultural Foundation Inc., Herbert W. Armstrong, Stanley Rader, Ralph Helge, Henry Cornwall, Robert Kuhn, Ray Wright, Osamu Gotoh, plus five firms with ties to certain of these individuals: Worldwide Advertising Inc., Wilshire Travel Inc., Gateway Publishing Inc., Environmental Plastics Inc., of Dallas, Texas, and the accounting firm of Rader, Cornwall, and Kessler.

Among the charges of the suit are the following: (1) that Herbert Armstrong and Stanley Rader have siphoned off (“pilfered”) millions of dollars of church funds annually for their personal use, (2) that there has been a failure to provide an adequate accounting of the church’s financial position as required by state laws governing charitable institutions, (3) that there has been a refusal to hold regular meetings of the corporations or to allow voting on matters affecting the governance of the organizations, (4) that there has been improper co-mingling of funds among the church, college, and foundation, (5) that there has been a liquidation of church-owned properties “on a massive scale,” including about 50 parcels in Southern California, (6) that written records of financial dealings have been removed from the church’s Pasadena office, shredded, and destroyed.

The suit does not ask for any monetary damages for the plaintiffs but calls for an accounting of all funds and financial transactions, especially of Herbert Armstrong and Stanley Rader. The suit also calls for the replacement of the trustees of the nonprofit corporations.

Excerpts from the book “The Truth Shall Make You Free” by John Tuit.

Chapter 11

*Herrmann then asked Kuhn, “What does Rader have on Herbert Armstrong, that he can seem to control him in that way?”  “I’m not sure, “responded Kuhn sadly, “but there are rumors of sexual compromise, in addition to the vast expenditures of money.  I also believe that Rader has a lot of powerful connections, I don’t know how they fit in to Mr. Armstrong’s international travels, but there may be something there.  As an example, Rader was very well acquainted with H. R Halderman.  During the Nixon administration, Rader’s oldest daughter worked in the White House and is now an attorney with the prosecutor’s office for either the city of the county of Los Angeles.  During the Nixon years there were some IRS audits of the college books and Ted’s return was audited. I understand that they were also going to do Rader’s return, but through some contacts in Washington he had that stopped.”

Herrmann then asked, “Would Rader, if he were an enemy of Garner Ted actually bail him out of  a large gambling debt?”

Wright replied, “Yes, he probably would.  That’s the way Rader operates.  Then it would give him something that he could hold over Garner Ted’s head to use whenever he saw fit.  Rader maintains meticulous files and a detailed diary of his every activity. HE would to that very type of thing if he thought it could provide him the tool he needed to control Ted at a later date. But there were other expenditures on Ted’s behalf. He frequently got large cash advances, which seemed rather strange considering that everyone had a credit card.  And then of course there were his flying lessons.  All of his flying lessons were paid for out of Church funds, including those which he required to obtain his jet pilot’s license.  All of those payments were made out of the general expense fund.  When you get right down to it, the Falcon jet was more of a toy than a business tool because it was used mostly for his personal use.  The same applied to the Cessna Citation which was used by Ron Dart and some other top ministers.”

Again, Herrmann brought up the same question that he had asked Kuhn, and a question that constantly prayed upon all of our minds.  He asked, “This is incredible. I really find it all hard to believe. I just don’t see how this man Rader can stay so tightly locked in to the point of coming out on top of Herbert Armstrong’s own son. He must have something on Herbert Armstrong that no one knows about.  Do you have any idea what it might be?”

Wright stumbled and stammered a bit and acted as though he wished that the question had never been asked..  He then said, ‘Well, of course Armstrong has spent more than his share of money, too. Rader was the guy who knows where every penny has gone.  He has threatened Mr. Armstrong many times that if he were ever let go he would tell the world everything (he) knows.  He has also  threatened many times to sue the Church and sue Herbert Armstrong.  His knowledge seems to go far beyond money.  A lot of the hold that he has over Herbert Armstrong seems to be centered around Armstrong’s own weaknesses. He has a drinking problem and (pg 165) that just leads to all other types of problems.  I think the whole key to the thin is Dr. Floyd Lochner. He’s a Ph.D. who used to teach at the college, but most of the time he accompanied Mr. Armstrong as one of his aides and also as his masseur. Lochner claims to have made several tape recordings of Herbert Armstrong revealing very intimate things to him.  He has acknowledged that he knows that he is not an apostle, but that  it is through the use of such a title that he can control the Church.  And then I understand that there were many sexual sins, but I don’t know the details about it.  I would say that the validity of all this is confirmed by the fact that Dr. Lochner is on a salary from the college of about $25,000 a year.  He has absolutely no duties and no responsibilities. It is strictly a  no-show job.”

*Jeff Herrmann was one of John Tuits attorneys
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From the INFO LIST:

STANLEY R. RADER (August 13, 1930 – July 2, 2002), was an attorney, accountant, author and, later in life, one of the Evangelists of the Worldwide Church of God , then a Sabbatarian organization, which was founded by Herbert W. Armstrong.


Stanley Rader was born and raised in White Plains , New York . He later moved to, where he met his future wife, Natalie “Niki” Gartenberg. He graduated from UCLA in 1951 and became a Certified Public Accountant in 1954.


In 1956 Rader met Armstrong, leader of what was then called the Radio Church of God , at its headquarters offices in Pasadena , California. Under contract with the Radio Church of God, Rader worked on improving its accounting system, thereby creating a highly favorable impression with Armstrong, who then urged him to attend law school at Armstrong’s expense. In 1963 Rader graduated from University of Southern California Law School .

The Radio Church of God had been previously incorporated on March 3, 1946, when it was re-established in Pasadena. Prior to this event it had been an unincorporated voluntary association based in Eugene, and named after its radio broadcast. On January 5, 1968, Armstrong, as president , together with the secretary of the corporation, amended its Articles of Incorporation to reflect the change of name to the Worldwide Church of God. (By then its radio broadcast had also been renamed The World Tomorrow ). By this time Armstrong was considered to be more of a modern-day apostle by his followers, rather than merely “pastor general,” his title in the church. After coming to terms regarding salary and compensation, in 1969 Rader decided to devote his full-time to the service of Armstrong.


Rader, who still considered himself Jewish, was baptized into WCG by Armstrong in 1975 using a hotel bathtub in the Mandarin Hotel in Hong Kong . This move allowed Rader to reposition himself as a high-ranking church evangelist in an attempt to quell misgivings by many in the ministerial hierarchy, who felt that Rader’s undue influence on Armstrong was troubling.


In a 60 Minutes interview with Mike Wallace, Rader defended himself, remarking to Wallace, “I don’t take stupid pills.” Wallace read to Rader a portion of a letter Armstrong was drafting, asking Rader to resign from any church positions that would make him Armstrong’s successor. Wallace then played a tape of Armstrong reading the letter. Rader started to sweat, before finally declaring: “Now I say you’ve acquired this by illegal means. I intend to have my attorneys today not only sue you if you use this. … Mike, look, I think you’d better scrap everything because you’re on my list. Okay? You’re never going to live it down, Mike, I guarantee it. … you’re contemptible. … I’d like you to get out of here, immediately!” Rader then stormed out of the room, and accused the press of distorting the facts.


Whereas the plan of was to ease his aging father into retirement, the plan of Rader and his aide Robert Kuhn was to transform Herbert W. Armstrong from an elderly evangelist into a more secular leader, casting him as a vital “Ambassador for World Peace without portfolio “. Rader’s plan required the creation of a totally new and secular cover entity from which to operate, distanced from Armstrong’s Worldwide fundamentalist sect, which might prove unpalatable to prominent world leaders as Armstrong played out his role as quasi-ambassador. In 1975, therefore, he incorporated the Ambassador International Cultural Foundation (AICF) which was actually funded from the tithe money of members of the Worldwide Church of God. In 1979, Rader was ordained as one of the Evangelists of the Worldwide Church of God .

As a consequence, the AICF transformed , on the Ambassador College campus, from a church auditorium, in which Saturday Sabbath church services were conducted, into a ” of the West”, and launched a concert series featuring the top names in classical music , jazz , and the performing arts. PBS and other television networks made use of this glamorous new venue. The AICF also created a new, glossy, secular, coffee-table, commercial magazine called Quest , with a circulation of several hundred thousand copies. Additionally, the AICF bought the book publisher Everest House , and funded the motion picture Paper Moon starring Tatum O\’Neal .

Armstrong, in the company of Rader, began introducing himself to any world leader who held political power and was willing to meet with the aging, grandfatherly figure for a photo opportunity for The Plain Truth , during which the leader would receive expensive gifts, such as Stueben crystal. Armstrong sold his new AICF portfolio approach to the church membership as being a new phase in preaching the church’s gospel .


Rader used his own professional legal accounting practice, and also incorporated new companies in order to conduct profitable business enterprises on behalf of the Worldwide Church of God. The companies largely owned and controlled by Rader included:

* Cartwright, Dixon. “Stanley Rader, WCG evangelist and treasurer and confidant of Herbert W. Armstrong, dies”. News of the Churches of God . The Journal. Retrieved 15 September 2012. * ^ “Rader Ordained – AR10 November 19, 1979”. Ambassador Report . The Painful Truth. Retrieved 15 September 2012. * ^ “Stanley Rader on “Sixty Minutes” with Mike Wallace”. Ambassador Report . The Painful Truth. Retrieved 15 September 2012. * ^ “The Lawsuit – AR7 January 21, 1979”. Ambassador Report . The Painful Truth. Retrieved 15 September 2012. * ^ “Petris Bill Passes”, Ambassador Report , Issue 13, September, 1980




Due to his involvement with the Discernment Ministries, which purport to be Christian and to expose the New World Order, Sir Anthony F. Buzzard seemed to warrant further investigation. A logical place to begin was the Worldwide Church of God in which Sir Anthony formerly held membership and employment for some time. The Worldwide Church of God was founded by Herbert W. Armstrong in 1934 as “The World Tomorrow” radio program with a magazine called The Plain Truth. The WCG was led by Herbert Armstrong and his son, Garner Ted Armstrong, prior to its transformation into an Evangelical denomination after highly publicized exposure of criminal and immoral activities.

Sir Anthony had informed me that he separated from the WCG when the denomination embraced orthodox doctrine and thereafter affiliated with the Church of God General Council, which maintained the Unitarian beliefs of the former WCG. A listing of the Worldwide Church of God – Organizational Splits states that Anthony Buzzard formed Restoration Fellowship in 1972, the year he left his teaching post at WCG Ambassador College. A publication of the Church of God, The Journal , still promotes the Garner Ted Armstrong Evangelistic Association and the Worldwide Church of God. [This COG website also interconnects a large network of Unitarian — Nazarene, Sabbatarian, Hebrew Roots, Seventh Day Adventist and Jewish — web sites.]

Anthony Buzzard wrote in The Journal : “I was in the WCG from 1960 to 1972 and taught music and biblical languages in Pasadena [Ambassador College at the WCG Headquarters] and Bricket Wood [College in England].” According to a 1978 BBC broadcast, Sir Anthony Buzzard was “a man who knew Herbert Armstrong well.” In a publication titled the Ambassador Report, Sir Anthony explained Armstrong’s “main ambition to meet top people around the world,” such as the Queen of England, whom he considered to be the descendant of King David:

“He felt that if he could do that he would have preached the gospel to the nations through getting at their leaders and after that has been done it was his firm belief that the end of the world would come. I’m sure that to meet Her Majesty the Queen would be his ultimate ambition. He’s always had a great love of England, and he would look upon the Queen as being a direct descendant of King David because he believes, or believed certainly when I knew him, that England and America are the descendants of the lost tribes of Israel, and therefore to meet the direct descendant of David would be the highest privilege he could think of.” (Ambassador Report, 8/21/78)

An expose of the Worldwide Church of God, The Truth Shall Make You Free by John Tuit, describes a religious empire which extorted not one, but three, tithes (30% of income) from its members to support extravagant lifestyles for Herbert W. and Garner Ted Armstrong and a law firm of Jewish attorneys who controlled the WCG for twenty years. The most prominent of these was Stanley Rader, who with Herbert Armstrong “had gained access to the heads of state in at least a dozen world capitals.” Former WCG member, John Tuit, who initiated the litigation and investigation of the denomination, wrote in 1981 of the power elites with whom Armstrong and Rader had connections, including members and even the founder of the Bilderberg Group:

“It is more than passing significance that Armstrong’s original contacts were made through high-ranking members of the Japanese government. Perhaps the mysterious Osamu Gotoh’s part in this will never be totally known. The Japanese, who have such a significant part in theTrilateral Commission, are also the very ones who have introduced Armstrong to many world leaders…

“Through the Ambassador International Cultural Foundation, Rader has established an institute for political research in Tokyo as well as a Society for Near Eastern Studies in Tokyo. There is a close relationship with King Leopold III of Belgium, who is one of the members of Prince Bernhard’s Bilderberg Group. And there has also been very close contact with Prince Bernhard. Doctor Singh of the World Court also figures prominently in the Armstrong-Rader contacts.” (The Truth Shall Make You Free, p. 289)




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