The Philip DeFranco Show - MS 1.14 The Truth About The Insane NXVIM Pyramid Scheme Revealed To Be Even More Dangerous

Episode Date: January 15, 2019

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Hello, hello, hello. Welcome to your Extra Morning News Show. My name is Philip DeFranco, and this morning we're gonna talk about something strange, weird, and just something that's honestly pretty horrific. And so with that said, let's just jump into it. Since 1998, there has been a cult growing in America, one where women are branded, forced into sex trafficking,

starved, blackmailed, and tortured. It's funded by two wealthy heiresses, promoted by a Hollywood actress. Some of the group's alumni include the co-founder of BET, a former U.S. Surgeon General, and the co-founder of BET, a former US Surgeon General, and the son of a former Mexican president. And right now, if you're thinking, okay, Phil, this seems like a lot, this is a bit much,

that sounds like a plot on Law & Order. Well, actually you're right, because Law & Order did base an episode of SVU on what we're gonna be talking about today. But while that was an episode from a TV show, this cult is real, it is really dangerous, and it is going to be in the news a lot more soon. And the cult that we're gonna be talking about today

is called NXIVM. In the past few months, six members of NXIVM have been charged with several crimes ranging from identity theft, extortion and forced labor to sex trafficking, money laundering, wire fraud and obstruction of justice. Before we dig further into the other members, we've got to talk about the origins of NXIVM and something called ESP. In 1998, a man by the name of Keith Ranieri founded Executive Success Programs Inc. The programs, called ESP for short,

were a series of workshops designed according to promotional material to actualize human potential. And part of ESP's allure was the huge promises the workshops made to potential members. And here's how ESP promoted itself on its website. Imagine if you could select at will designer qualities and characteristics

and begin to wield them as your own. If you could possess Gandhi's inner strength, Einstein's intellect, and Jim Thorpe's athletic ability, how would your life transform? Our programs provide the tools for transformation. We're a professional coaching company dedicated to empowering people to make better decisions so they can create richer, more joyful,

and more meaningful lives. And five years after founding ESP, Keith Raniere created NXIVM. And NXIVM ended up becoming an umbrella organization that included ESP and other similar classes that Raniere had created. And NXIVM's goal was to bring people self-fulfillment by eliminating psychological and emotional barriers. And just like ESP, NXIVM made pretty big claims. Over the years, Raniere had said that his teachings had helped members overcome their Tourette's Syndrome, their OCD, improved their success at work and in finance, even helped people become better athletes.

And in this video, R Ranieri even says his programs might be able to do even more than that. Yeah, I think things like OCD, migraine headaches, even certain fertility things, maybe fatigue things, who knows, you know, attention deficit disorder things, autism, who knows? We may have some positive effects on those things. So what were the classes like

that had the ability to actualize human potential? Well, to answer that, we really only have one place to look. In 2003, a Forbes magazine writer met with Ranieri at his organization's headquarters in New York. And the article that followed was one of the only reports we have that describe what the classes at NXIVM were like. And a big reason for that is because members

are actually required to sign non-disclosure agreements before they partake. So, what did the Forbes article uncover? Well, to start things off, the article revealed that members don't actually call Keith Raniere by his name, instead they referred to him as Vanguard. The Forbes article also uncovered other weird things, like the fact that members started every day

with a special handshake. Additionally, they also used some terminology similar to Scientology. NXIVMs, as members are known, were encouraged to take classes like ESP and recruit others to take classes as well. And with that, recruitment of others helped members rise in the ranks to reach different, quote, goal levels.

Nexians wore different color sashes to mark which goal level they've reached. And along with moving up in goal levels comes different responsibilities and privileges. Higher level Nexians could actually make a salary or a commission, and that was important because these classes were not cheap. Classes at Nexium reportedly cost anywhere from $5,000

for a five day workshop to upwards of $25,000 a day for more exclusive classes. And because the classes were so expensive and members were pressured to continue taking them, NXIVM could get into debt. And then members could feel obliged to stay with the group to make up these debts. And if it sounds like a pyramid scheme to you,

well, yeah, hold that thought because we're gonna be coming back to that in a minute. But even with the high price, classes have lured in lots of people to NXIVM over the years. Since its founding, it's estimated that around 16,000 people have signed up for courses offered by the group. And like we said earlier,

some of the people who have signed up for Keith Raniere's classes have been pretty notable. Sheila Johnson, the co-founder of BET, Antonia Novella, the former US Surgeon General under George H.W. Bush, Emiliano Salinas, a venture capitalist and son of former Mexican president Carlos Salinas, they have all reportedly taken a Raniere class.

Additionally, NXIVM has also held a VIP session with Richard Branson on his private island in the Caribbean. Allison Mack, who's an actress best known for her role as Chloe on the show Smallville, is a high ranking member in the group. And Claire and Sarah Bronfman are also active members of NXIVM. And this pair are heiresses to the Seagram's fortune.

And it's also alleged that the two have poured in more than $150 million into NXIVM since 2004. But the most surprising person connected to NXIVM is probably the Dalai Lama. The Dalai Lama actually wrote a foreword in one of Keith Raniere's books. And in 2009, NXIVM even hosted an event in New York for the Dalai Lama, and there are photos

of the Dalai Lama with Raniere at this event. Also in this picture, you see Claire and Sarah Bronfman on stage with him in New York for the Dalai Lama, and there are photos of the Dalai Lama with Raniere at this event. Also in this picture, you see Claire and Sarah Bronfman on stage with him in New York. But also, NXIVM isn't just made up of actresses, millionaires, and famous people, right? It was also made up of regular everyday people, and as NXIVM grew, the lives of some of these everyday people became more intertwined with the group, which meant that some NXIVMs moved beyond just taking classes. Some left friends, family, jobs behind to follow the group's leader, Keith Raniere, full-time. But with that, we have to ask, who is Keith Raniere and how did he come to lead this group that has been now charged with some pretty horrible things? And for that, we look back. Keith Raniere was born in Brooklyn, New York on August 26, 1960.

At age 5, Raniere's family left Brooklyn and moved to the suburbs of Suffern, New York. For most of his education, he attended private school. He reportedly really excelled in his classes. And if you get really interested in this and you start doing your own research into Keith Raniere, you'll also notice something pop up over and over when you look at bios of his life. Everybody talks about Keith Raniere's intelligence. But just how smart Raniere is is probably up for debate. We do know that in 1982, Raniere graduated

from college triple majoring in physics, math, and biology. He also had two minors in psychology and philosophy. And that's one of the only confirmed things we really know about how smart he is. And it's important to mention that because over the years Ranieri has actually made some pretty big claims about his own intelligence that kind of lends to the lore about his brilliance. He said he talked in full sentences by age one and was reading by age two. He claims that he taught himself high school math in 19 hours when he was 12 years old. He has said that he completed three years of college math and computer language classes by the age of 13.

Ranieri has also claimed that in 1989, he was in the Guinness Book of World Records for the highest IQ. And actually on that note, we reached out to Guinness World Records to see if that claim was actually true. And as surprisingly, this is what they told us. A search of our database found that Keith Ranieri

was featured in the 1989 edition of Guinness World Records. They also told us that Ranieri scored one of the three highest scores ever recorded on an IQ test developed by an organization known as the Huffland Research Group. They also told us that Ranieri scored one of the three highest scores ever recorded on an IQ test developed by an organization known as the Huffland Research Group, with Guinness saying that Ranieri's results on the test represented a, quote, performance at the level of one in 10 million.

That's not even the craziest claim about Ranieri's intelligence. According to some news outlets, Ranieri has even told Mexians he doesn't drive because his intellectual energy sets off radar detectors. I'm just gonna let you live with that claim for a second. But one of the main points here is that over the years, Wanniri has used the self-proclaimed superior intellect

to promote companies that he has created. And this includes a company that he formed in the early 1990s called Consumers Byline. And actually on that note, if you really wanna understand how Nexium works, it's worth taking a deeper dive into Consumers Byline. Consumers Byline, or CPI for short, was a company based entirely on memberships where people would join at a cost of $219 a year.

And that membership fee gave people access to buying groups. And these buying groups bought goods like electronics and household appliances in bulk. And members could then get the goods from their groups for discounted prices. And just like Nexium, members could also move up and make more money if they brought in new members. Now remember how Nexium sounded like a pyramid scheme?

Well, it turns out that Consumers Byline was also a pyramid scheme. Here's a 1992 news report on the company. A follow-up tonight on Consumers Byline. We first told you about Consumers Byline last May when the company was accused of being an illegal pyramid scheme that uses unfair sales practices to sign up new members. On Saturday night, more than 200 main Consumers byline members packed into this Biddeford theater all looking to meet the man behind the company President Keith Ranieri but Ranieri did not show up and some say as a result the meeting got nasty. So far the company is facing four state investigations and several state lawsuits as a result of one of those lawsuits consumers byline will no longer sell memberships

in the state of Arkansas. Here in Maine, the Androscoggin County District Attorney has demanded CBI return all of the money sent in or drafted out of members' bank accounts. DA Janet Mills says she considers the activities of Consumers Byline to be illegal. And a few years after that report, the company was forced to shut down

as CBI was investigated as a pyramid scheme by several state's attorneys general. But shortly after CPI closed, Ranieri created another company called ESP. And that of course as we said became part of Nexium. But how did Nexium go from a weird self-help group slash pyramid scheme to full-blown sex cult investigated by the FBI? Well that has to do with a secret society that's formed within NXIVM in the past few years and changes in Ranieri's teaching. In 2003, Ranieri started running his classes and workshops at a compound outside Albany, New York.

And that's where Ranieri reportedly started teaching his followers about the difference between men and women. Ranieri claimed that men and women were innately wired differently. Men, he claimed, were oppressed and unable to enjoy the same rich experience of existence as women, saying they also have a better inherent understanding of right and wrong,

while women, he said, were more often disloyal and have tantrums that allow them to get away with whatever they want. And in fact, in this video, Ranieri talked with Allison Mack about how men and women are not equal. I don't believe in equality. It would be awful to say that men or women are equal.

And it would be horrible in the world if we were equal. We would be so far behind. Men desperately need women and women desperately need men. They need the differences. Ranieri also started teaching something called the primitive hypothesis. And basically it's the idea that men are naturally promiscuous and women are naturally monogamous. And it's this important idea that became the center of NXIVM's secret society. And in 2015, reportedly, that secret society became the center of NXIVM secret society. In 2015,

reportedly that secret society began to form within NXIVM and it's been called both the VAL or DOS. DOS standing for Dominus Obsequius Sororium, which in broken Latin loosely translates to Lord slash master of the obedient female companions according to ex-members. And just like NXIVM and CBI before it, DOS was structured like a pyramid. But this pyramid was made up of levels of slaves and masters. Ranieri was the only male member of the group and he made up the top of the pyramid as the highest master. Women in the group were referred to as slaves, but women could also move up and become masters themselves

if they recruited more slaves. And while recruiting a new DOS member, masters made slaves provide them with something they called collateral. And this collateral is usually something like incriminating photos, videos, or damning confessions about a recruit or her family. And so if DOS slaves left the group,

spoke publicly about their involvement, or failed DOS obligations, their collateral would be released. And these women who were targeted for DOS recruitment were often going through a difficult time in their lives, or they were women who wanted desperately to move up inside NXIVM. Masters would tell these potential slaves

that the secret group would be a special chance for them to improve their lives in a select group. And unlike we're doing now when recruiting women to join, DOS members avoided using the words master and slave. Instead, more often, masters told potential members that DOS was a, quote, women's mentorship program. And if someone was hesitant to join the group, they were told that the hesitation

was due to their inherent feminine weakness. Once in the group, DOS slaves were forced to serve their masters in various acts of care. Those acts of care included running errands for their masters, cleaning their homes, bringing them coffee, preparing their food, and reportedly slaves who failed to complete these acts of care risked their collateral being released.

Additionally, the women of DOS reportedly were forced to perform uncomfortable acts of self-denial, like taking icy showers and standing for an hour at four in the morning. Slaves were also given assignments, which included reviewing densely written articles about ESP and other NXIVM programs. One DOS member said she was forced to stay awake for 23 hours straight to review 95 articles. Another assignment included participating in readiness drills,

which consisted of having every person respond to a text message at any given time, day or night. They were also threatened with being placed in cages if they failed the drill. And with these readiness drills and other assignments, it often resulted in slaves suffering from severe sleep deprivation. And if that wasn't bad enough, reportedly other assignments included slaves being forced to have sex with Ranieri.

Reportedly masters who directed their slaves to have sex with Ranieri were rewarded with an increased status inside DOS, them also reportedly getting special financial benefits. Slaves were also forced to pose for nude photographs, including closeup pictures of their vaginas, which were given to Ranieri. Also, some of the assignments were designed

to groom DOS women to become sex slaves for Ranieri. For example, women were forced to starve themselves on extremely low calorie diets to stay thin because Ranieri allegedly preferred very thin women. Women who didn't comply with these rules could also be brutally punished. Ranieri allegedly physically assaulted at least two intimate partners.

Also forcing another member into 18 months of confinement after she expressed romantic feelings for someone else. And on top of all of that, Ranieri preached something even more disgusting. He told his followers that age of consent was too rigid, arguing that it should be lowered to when a child's parent says the child is capable of consent. And so unsurprisingly, federal prosecutors have accused

Ranieri of having sex with multiple underage children, one of which was reportedly as young as 12 years old. Also, we should talk about the branding. DOS slaves were forced to participate in a branding ritual. Women were stripped naked, blindfolded, and then brought into a room together, women who did not know they were going to be branded beforehand.

Some thought that they were going to be getting matching tattoos, but once they were inside, the room masters would order one slave to film, while all the other slaves and DOS members held down the slave that was being branded. And these women were branded with a cauterizing pen and each brand reportedly took between 20 to 30 minutes.

And these videos of the branding ceremonies were also used as even more collateral. And as far as the brands themselves, the women were told that these would represent the four elements, but the brand was actually Keith Raniere's initials. Raniere even allegedly admitting this to a woman in DOS and said that the brand was a form of tribute.

But all these horrible alleged crimes DOS members were involved in seem to have come to an end. And that appears to be because Ranieri was arrested in March after fleeing to a NXIVM chapter in Mexico. And Ranieri, along with Allison Mack, has been charged with sex trafficking, sex trafficking conspiracy, and conspiracy to commit forced labor.

And as far as NXIVM is concerned, they have suspended all operations and planned events. After his arrest, Ranieri released a statement on NXIVM's website where he tried to distance himself from DOS saying, quote, "'I feel it is important to clarify the sorority "'is not part of NXIVM and that I am not associated "'with the group.

"'I firmly support one's right to freedom of expression, "'so what the sorority or any other social group "'chooses to do is not our business "'so long as there is no abuse.'" But here's the thing about that denial, though. The FBI says they have proof that that is a lie. The FBI has publicly released the complaint and affidavit in support of Keith Raniere's arrest warrant. And in that document, the FBI says that they gained access to messages Raniere sent through a Yahoo email account and WhatsApp. And those messages, according to the document, support the conclusion that Raniere

created DOS. The emails also show that Ranieri had direct knowledge about collateral collected from slaves. The FBI even detailing some collateral that was collected from a slave in late 2015. That slave is referred to as CC1 by the FBI and that complaint reads, "'This collateral was described as one, "'a letter regarding CC1's mother and father

"'that would destroy their character. "'Two, a contract that transferred custody "'of any children birthed by CC1 to Ranieri if CC1 broke her commitment to Ranieri. Three, contract that transferred ownership of CC1's home if commitment to Ranieri was broken. And four, a letter addressed to social services alleging abuse to CC1's nephew.

Also there was another WhatsApp chat showing Ranieri directly asked a master to recruit a sex slave for him. But with all of this collateral, I mean it's just blackmail in my eyes, you might ask, how did the cult leaders like Ranieri and Allison Mack finally get charged for doing these horrible things? Well, last year a former member and actress named Sarah Edmondson spoke with media outlets like the New York Times and Vice about the group's branding process. Sarah even allowing these outlets to take photographs of her brand, with her also describing the branding

ritual to ABC News Nightline. The woman on the table screamed out in pain, you know, twisted and turned and yelled. And the woman I was with holding her legs down, we looked at each other and we just wept. Why didn't you let go and run out of there even naked? It didn't seem like a choice at the time. Imagine a hot laser dragged across your flesh for 30 minutes without anesthetic. And after Sarah shared her experiences, NXIVM started getting more and more media coverage. The FBI then began an investigation into the group.

That investigation, of course, then led to charges being brought against Raniere as well as four other members. Some of those being Claire Bronfman, who's one of the Seagram heiresses, and Allison Mack. And as far as why you're gonna be hearing about this more and more is that right now, the trial is scheduled to start on March 18th.

And ultimately that is a, that's a story obviously we're going to be paying attention once this trial starts, but now you've got to head start on everyone else. Oh my god, the world is a scary place. Of course, like with everything we cover on this channel, I do want to pass the question off to you. What are your thoughts around this situation? Any and all, I'd love to hear from you in those comments down below. Also remember, if you like getting these extra dives into the news,

let us know by hitting that like button. Also, if you're new here and you want more daily dives into the news, be sure to subscribe, ring that bell. We have a daily Philip DeFranco show on the weekdays, extra morning news videos on Tuesdays and Thursday mornings, ramping up more and more as the year goes on. But of course, with all of that said, thank you for your time, thank you for watching,

and I'll see you later today on today's brand new Philip DeFranco show.