Former NXIVM president sued over failure to comply with civil settlement

Albany — A lawsuit filed Nov. 8 in state Supreme Court in Albany County alleges Nancy Salzman, the former president of NXIVM, is failing to comply with a financial settlement with the cult-like organization’s victims.

In 2020, nearly 70 people filed a civil lawsuit against Salzman as well as NXIVM founder Keith Raniere and other former NXIVM leaders. As part of the settlement, Salzman agreed to sell three properties in Halfmoon she owned through an limited liability company, with the plaintiffs signing off on the sale prices for those properties.

Salzman, 70, did not admit any wrongdoing in the civil settlement.

Two of the properties sold for $167,500 and $230,000, respectively, in 2023; the third, a condo, sold in April for $190,000. The victims’ portion of the net proceeds from the third property’s sale was supposed to be $155,687.

Salzman, through a law firm that is holding the proceeds in escrow, claims she needs the money to pay more than $116,189 in capital gains taxes from the sale of the three properties, according to court documents. She has instructed the firm not to release the money without a court order.

Attorneys for the plaintiffs noted in their complaint that the settlement agreement doesn’t contain any language about Salzman’s tax responsibilities.

Salzman was released from a federal halfway house earlier this year after serving less than 20 months of prison time for the crimes she committed as Raniere’s top deputy in NXIVM, which collapsed in 2018 following the arrests of Raniere, Salzman and other members of its inner circle.

In September 2021, Senior U.S. District Judge Nicholas Garaufis sentenced Salzman to prison and fined her $150,000 based on her earlier guilty plea to racketeering conspiracy related to her involvement with NXIVM. Salzman reported to federal prison in February 2022.

As part of her sentence, she was ordered to forfeit several properties and more than $500,000 in cash.

A native of Cranford, N.J., who had worked as a nurse, Salzman co-founded NXIVM and its Executive Success Programs with Raniere in 1998. Over the next two decades, she served as president of the secretive Colonie-based organization as it added locations in Mexico, Canada, Los Angeles, the Pacific Northwest and Europe.

Visitors to NXIVM’s headquarters on New Karner Road in Colonie were greeted by photos of Salzman, known as “Prefect,” and Raniere, known as “Vanguard.” While Salzman held the position of president, Raniere was NXIVM’s unquestioned leader. She preached the teachings of Raniere, who she had for a period been romantically involved with, to NXIVM students — even passing along his claims that children are “perfectly happy” having sex with adults and that women experience “freedom” during rape.

Salzman instructed NXIVM members that anyone challenging Raniere or NXIVM, including family members and friends, were “suppressives” to be avoided. Former NXIVM insiders have described Salzman as Raniere’s enforcer, but also a victim of his cruelty and manipulation. She was not involved in Raniere’s secret “master/slave” group, Dominus Obsequious Sororium (DOS), which ultimately led federal prosecutors in Brooklyn to charge Raniere.

Salzman was among six NXIVM defendants, including Raniere, charged in a sweeping racketeering indictment in 2018. All but Raniere pleaded guilty. In June 2019, jurors convicted Raniere on all counts of sex trafficking, forced labor conspiracy, wire fraud conspiracy and racketeering counts with underlying acts of extortion, identity theft and possession of child pornography.

Raniere, 64, is serving a 120-year prison sentence in a federal prison in Tucson, Ariz.

Salzman, the first defendant to plead guilty, admitted she doctored tapes that were offered as evidence in a lawsuit in which NXIVM sued cult expert Rick Ross and faced counterclaims. Salzman admitted she conspired to commit identity theft when she tried to obtain names and passwords of email accounts of NXIVM’s perceived enemies, information stored in files kept in the basement of her home.