Manipulations of fortune; Daughters of business royalty, alleged cult leader at centre of lawsuit

Canwest News Service/March 29, 2010

In 2003, Forbes magazine ran a cover story on Keith Raniere, 49, "the world's strangest executive coach," a man who calls himself "Vanguard" and has shared his quasi-Scientological vision of self-improvement with prominent people, including a CEO of Enron and the daughter of the Mexican president.

The story described his approach to success as "apocalyptic" and intensely self-interested, and preached in a "bizarre world of messianic pretensions, idiosyncratic language and ritualistic practices."

Mr. Raniere says that criticism was orchestrated and paid for by Canadian business icon Edgar Bronfman Sr. as part of his efforts to rescue his two daughters from Mr. Raniere's influence, efforts that also allegedly involved rigging a California real estate deal to fail, court records allege.

Today, this family dispute has come into public view because of unproven claims made in a California lawsuit that Mr. Raniere "exercised complete control" over Sara Bronfman, 33, and her sister, Clare, 30, and lost as much as US$100-million of the family's fortune in investment schemes.

A lawyer for the Bronfman family has denied the claims, and said the sisters are merely "enamoured with his ethical pursuits."

The Bronfmans are Canadian business royalty, with a fortune built through their Seagram liquor empire. Now a philanthropist and former head of the World Jewish Congress, Mr. Bronfman Sr. was succeeded as president of Seagram by his son, Edgar Jr., who withdrew from the distillery business to pursue media and entertainment ventures.

The Bronfman sisters remain strong adherents of Mr. Raniere's philosophy, and both maintain personal websites that profess their devotion and respect for him, as a "mentor" and friend, their blogs say.

Sara writes that she first met Mr. Raniere in 2002, at a seminar for his Executive Success Programs. "Within two years, I became one of the company's top-ranked international trainers and was elected to serve as Director of Humanities, overseeing the company's humanitarian activities within its thirty-three-country network," her blog says.

Her other "lifelong heroes" include Sir Richard Branson and the Dalai Lama.

Clare, a former equestrian show jumper, describes Mr. Raniere as giving her the "greatest gift one human can give to another … the opportunity to see oneself and others as human."

The sisters jointly founded a group called the Ethical Humanitarian Foundation, which Sara described as "a non-profit organization promoting the evolution of humanity through ethics," and their blogs cite Mr. Raniere as "our mentor and conceptual founder."

Its website describes him as "one of the world's top three problem solvers" with "an estimated problem-solving rarity of one in 425,000,000 with respect to the general population," and prominently features a quote by him: "Ethics, ultimately, is the end of all conflicts."

In a personal biography that is largely about Mr. Raniere's influence, Sara also refers in her blog to her father as her "master teacher in this life."

The tabloid New York Post reported on the case last week, calling Mr. Raniere a "shady svengali" and pegging the Bronfmans' losses at almost US$100-million. It also reported that the sisters' father, Edgar Bronfman Sr., called Mr. Raniere's organization, NXIVM, a "cult" and is "considering legal action" to restrict his daughters' access to the family fortune.

The allegations are made in an affidavit by Barbara Bouchey, a financial manager who is reportedly a former NXIVM board member who dealt with the Bronfman investments, and also a former girlfriend of Mr. Raniere. She calls him the "absolute leader of a cult called NXIVM," and says the Bronfman sisters are paying his legal bills.

"The girls knew nothing about real estate and they knew nothing about investing," Ms. Bouchey states in the affidavit.

That document is part of a lawsuit brought by NXIVM principals over a failed Los Angeles real estate project in which the Bronfman sisters invested US$26-million.

The Albany Times Union quoted a Bronfman family lawyer as calling the accusations "salacious" and "malicious." The lawyer, Robert D. Crockett, also said Ms. Bouchey refused to answer a question about whether she threatened to take her claims to the press unless she received a disputed payment.

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