First of two parts

Philip Berg’s new wife was young, beautiful and worldly, everything that he, a middle-aged orthodox rabbi, wasn’t. Karen Berg could be pushy too. She brought a television into their home over his objections. She tossed out his traditional black fur hat, and pressured him to teach ancient Jewish mysticism -- known as kabbalah -- to the public.

“Men and women together?” Philip said.

“Yeah, sure, men and women,” she replied.

Philip understood how radical her proposition was. For centuries, elite rabbinical scholars -- all of them men -- had guarded like rare gems the spiritual secrets believed to be encoded in the Torah. Karen was an outsider to this culture. Entrepreneurial and unimpressed by religious authority, she saw no reason why such valuable teachings shouldn’t be offered on the open market.

“Let’s give it to the people,” she insisted.

Philip was torn between tradition and his soul mate. He chose Karen.

That conversation four decades ago, recounted by Karen in videos and in a book she wrote, set the course for their lives. Once so poor that they shopped at thrift stores, slept in cramped rooms above a Queens synagogue and studied scripture on a pingpong table, the Bergs gradually turned their spiritual vision into the Kabbalah Centre, a worldwide organization with headquarters in Los Angeles, branches in dozens of countries and assets estimated to be in the hundreds of millions of dollars.

The center’s teachings about God, happiness and the meaning of life drew a passionate following that included big names in film, fashion and music. Devotees treated the couple as if they were gods. Some considered it an honor to eat Philip’s table scraps. They addressed Karen in the third person and showered the couple with gifts, including couture handbags and spa vacations. The Bergs stayed in luxury hotels, traveled by private jet and took gambling trips to Las Vegas, according to former members of their inner circle.

The Kabbalah Centre prospered, but eventually its success proved divisive, and harmony gave way to public discord. The Bergs’ lifestyle was questioned, their finances scrutinized. Friends became enemies, supporters fell silent. In recent months, IRS agents investigating the center’s finances pored over records and questioned the Bergs’ followers.

Philip had always sensed that Karen’s idea of kabbalah for the people would stir vehement opposition. “We’re probably going to get killed,” he warned her during that conversation 40 years ago. “We’re probably going to get stoned.”

A devout religious upbringing

Philip Berg was born Shraga Feivel Gruberger in Brooklyn, two months before the stock market crash of 1929 runtime:topic>. His family was devoutly religious. Their neighborhood, Williamsburg, filled with Hasidic Jews fleeing Europe. A thorough Torah education was a given and Philip began his at age 3. He attended ultra-Orthodox yeshivas and was ordained a rabbi in 1951.

As a young man, he turned away from full-time religious studies. He later wrote that he had become “profoundly disillusioned by my religion as it had been taught to me,” but he also needed to support his wife, Rivkah, and their young family. The couple would eventually have eight children. He Americanized his name and became a salesman for New York Life Insurance Co., a position family friend Billy Phillips said afforded him a chauffeured Cadillac and good cigars. In the early ‘60s, Philip went to Israel, where he was introduced to kabbalah by his wife’s uncle, a renowned scholar named Yehuda Brandwein. Kabbalah entranced Philip. Unlike yeshiva, often dominated by debates about the minutiae of Jewish law, kabbalah focused on life’s existential questions: Why am I here? How can I be happy?

Brandwein, who ran a Jerusalem yeshiva, was Philip’s spiritual guide to the mystical world that would become his lifelong devotion.

The Hebrew word for “received,” kabbalah holds that the first five books of the Bible contain hidden lessons. Kabbalists believe God revealed this wisdom to Moses along with the Ten Commandments. That knowledge, they believe, was passed down orally until the 13th century, when it was published in a series of books known as the Zohar.

Some Jewish scholars regarded with suspicion kabbalah’s preoccupation with astrology, reincarnation and a world of unseen forces. Others, including Philip, saw it as Judaism at its purest.

Returning to Brooklyn, he opened his insurance office at night to orthodox Jews for the study of the Zohar. In 1965, with the help of another student and an elderly, impoverished scholar, Levi Krakovsky, Philip set up the National Institute for Research in Kabbalah, a forerunner of the Kabbalah Centre.

In a tiny apartment so crammed with books that he could have only one visitor at a time, Krakovsky translated the Zohar and other texts into English. He yearned to spread the teachings, but like other scholars before him, he was confounded by an inherent contradiction in kabbalah: It taught that the Messiah would appear only when the world embraced its wisdom. Yet only Jewish men, 40 or older and with an encyclopedic knowledge of the Torah and Jewish customs, were permitted to study it.

Krakovksy lugged his handwritten manuscripts around Brooklyn in a suitcase, searching for an audience. He died in 1966, never having found a publisher. Years later, his heirs claimed that Philip had stolen some of his manuscripts. They sued, accusing Philip of publishing the translations under his own name to make money and “to falsely enhance [his] stature ... as a great Kabbalah teacher.”

Philip denied the allegations.

The case went to trial in Manhattan federal court, but just as the jury was to begin deliberations, the center reached a confidential settlement with Krakovsky’s family.

Whether or not he stole Krakovsky’s work, Philip inherited his desire to expand kabbalah’s reach. That ambition might have remained unrealized had he not hired a gum-smacking 16-year-old named Kathy Mulnick as a receptionist.

Oft-told tale of couple’s meeting

The Bergs’ romance is the Kabbalah Centre’s creation story, and the family has told and retold it in books, videos, religious services and media interviews. Verifying it has proved difficult. Many of those involved, including Philip’s first wife, are dead. The Bergs declined to talk to The Times.

Raised by a single mother in postwar Brooklyn, Kathy Mulnick was a self-described wild child who could take care of herself. She attended 13 different schools, and would later tell friends she couldn’t read until she was 9. Later in life, after she changed her name to Karen, she regaled friends with stories of the toughness bred by her chaotic youth.

Her family was Jewish, Karen has said. But they were assimilated and ignorant of even the most sacred parts of the religion. In a 2009 interview with the Jerusalem Post, she recalled a family tradition of enjoying a big meal on Yom Kippur runtime:topic>, the day of fasting and atonement. Her job at Philip’s insurance office exposed her to the world of religious Jews who observed the Sabbath and kept kosher.

She has written that as a high school student, she had nothing in common with her boss, a 31-year-old with a wife and children. “In fact, I disliked the man,” she wrote in “God Wears Lipstick,” a 2005 book subtitled “Kabbalah for Women. ”

After six months, she quit.

At 17, she married a man from her neighborhood. They had two daughters, built a contracting business and eventually divorced. After they separated, she decided to call an old friend in Philip’s office. At the end of the conversation, she asked the woman to say hello to Philip for her. It had been eight years since she had seen him.

“Not 10 minutes later, my phone rang,” she wrote.

It was Philip. They chatted and their conversation turned to his devotion to kabbalah. Karen was intrigued because of her interest in New Age runtime:topic> philosophy and asked if he would give her private lessons. By her account, Philip, who wouldn’t even shake hands with a woman who wasn’t his wife, nonchalantly replied, “Okay, why not?”

“We made a date for dinner that night to discuss the details,” she wrote later. “I have to tell you at that meeting, it was all over. We knew instantly that we were meant for each other.”

Philip’s marriage to his first wife fell apart, and he and Karen were married in 1971. Their early relationship was a tug of war between her worldliness and his piety. Philip threw out his new wife’s library of New Age books and blocked the door when she tried to bring a television into their home. He gave in when she threatened to leave him, Karen wrote.

Then there was the hat.

“One day I took that big black fur hat off his head and threw it right out the window. I said to him, ‘Let’s understand something. I joined your world so you’ve got to come to mine. I can't live with this kind of strictness,’” she wrote.

Philip gave up the insurance business and the couple moved to Israel shortly after they were married. They lived in a tiny apartment in Jerusalem with their sons, Yehuda born in 1972 and Michael in 1973, and drove a beat-up Fiat, recalled Jeremy Langford, an early disciple who lived with the Bergs in Israel for two years.

Karen began to study kabbalah seriously. They argued over what to do with

Philip’s spiritual knowledge. She suggested teaching kabbalah to anyone who wanted to learn about it, including women and those without yeshiva training. Philip acquiesced, and in so doing elevated Karen to a status well above a rabbi’s wife. In the eyes of followers, Karen became Philip’s peer: He had the education, she had the nerve.

“What Karen Berg has done is what no man in history has done,” said Phillips, the family friend. “Never have the words ‘kabbalah’ and ‘Zohar’ been known outside the small circle of kabbalists.”

The Bergs advertised introductory classes; the cost was about “the price of a falafel,” one former member recalled. The New Age seekers, retirees and others drawn to the courses in Tel Aviv were from secular homes and knew little about their Jewish heritage.

“We loved that we found mysticism in our own backyard, in Judaism. The teacher spoke of things that very much resonated with us.... There was no pressure to be observant,” said one longtime member who became disillusioned and left the center after two decades. The former member, who continues to practice kabbalah’s philosophy of helping others, asked not to be named because relatives are still involved.

Philip held himself out as the spiritual successor to Brandwein and used the name of a kabbalah yeshiva founded in Jerusalem in 1922. But Brandwein’s heirs, who were running the yeshiva at the time, publicly disavowed any connection to Berg.

Philip had fewer than two dozen regular students in 1977 when Langford enrolled. Langford said he was captivated by the rabbi’s teachings: “Everything we did felt so important. The future of spirituality was dependent on us.”

The Bergs spoke constantly of expanding and in published materials sometimes exaggerated the size of the organization, he said. “There was a joke that anywhere he had sneezed he would say there was a branch there,” Langford said.

In the classroom, Philip, known as the rav, or rabbi, was beloved for his clear explanations of lofty concepts such as shame and mercy. At home, his conversations with Karen often concerned less spiritual topics.

“She was always talking about money and the need to have it,” Langford said. Karen wanted a big house and her husband agreed, saying it could attract new students, he said.

“He could see in her no evil. He could see in her no wrong,” recalled Langford, who was the first student promoted to teacher. He is now a glass artist in Israel and said he still studies kabbalah.

In the early 1980s, the Bergs returned to the U.S.

“He came to me and said that if he wants to make it big time, it can’t be done in Israel,” Langford said.

A family affair

The Bergs settled in Richmond Hill, a middle-class Queens neighborhood. Karen finally had the big house she wanted, but its stately exterior belied a modest existence. They had moved back from Israel without enough money for a car, according to former student Dorothy Clark. She and another former student recalled that Karen dressed their sons in secondhand clothing.

The house doubled as the American headquarters of what would soon be known as the Kabbalah Centre. The basement served as a dining hall and the living room as a synagogue. Classes were held around a pingpong table, one of the Bergs’ few pieces of furniture, recalled Michel Obadia, a Manhattan hair salon owner who studied at the center.

As in Israel, the students were mostly alienated Jews who liked Philip’s combination of approachability and orthodox background. He would teach that the oft-told stories of Adam, Abraham and other Torah figures contained hidden wisdom about how the universe worked. Over two hours, Obadia recalled, Philip would discuss what the Zohar taught about a particular esoteric topic -- how to find the middle ground between judgment and grace, for example.

Obadia said students would speak up about how the abstract principle applied to their own lives.

“He had the language, the formulas, for you to pierce through and all of a sudden start to understand things,” said Obadia, who left the center more than 20 years ago but can still recite many of Philip’s teachings.

He said that at the close of class, many students would strap on phylacteries -- small boxes that contain Torah passages -- and pray together.

Their congregation was growing, but the Bergs were determined to reach even more people. They turned to publishing. In Israel, they had discovered that students wanted their own kabbalah texts and would pay for them. This was a revelation to Philip, who was used to impoverished yeshiva scholars hunkered over communal books, as he later recalled in testimony in a civil lawsuit.

The books sold in Israel were dense and difficult, and written in Hebrew. Berg turned to Clark’s husband for help in making the teachings more accessible. Kenneth Clark was a Chicago Tribune reporter covering entertainment in New York. The two men got together every Wednesday night at the Bergs’ dining room table.

“His idea was to get this into common language that anybody could understand,” Kenneth Clark recalled in court testimony years later.

Philip would explain a portion of kabbalah to Clark, who had been raised a Southern Baptist and knew no Hebrew. Clark would look for ways to make the ancient teachings relevant. When Philip described kabbalah’s conception of the age-old conflict between good and evil, Clark suggested comparing it to the "Star Wars" runtime:topic> movies.

Books he wrote with Clark and other ghostwriters allowed Philip to reach beyond Queens and Israel, and the Bergs soon had branches in cities with large Jewish communities, including Miami, Toronto and Paris.

They also established a religious order called the chevre , “friends” in Hebrew. The chevre , primarily young Israelis, took vows of poverty and lived dormitory-style in a house near the Bergs’ Queens home and later in cities around the world. By day, they knocked on doors in Jewish business districts, carrying Zohars and delivering a pitch about the center to raise funds. At night, they roamed Jewish neighborhoods.

“We would say, ‘We are teaching Jewish spirituality.’ Most people would say, ‘I'm not interested.’ Some would say, ‘What's it about?’” recalled Shaul Youdkevitch, a high-ranking teacher who had a falling-out with Karen in 2008 after three decades as a chevre .

The chevre tried to persuade people to make a donation or buy a Zohar for $360, according to Youdkevitch and other former members of the order. Many of the people they solicited did not read Hebrew, but the chevre assured them that wasn’t a problem: Just passing a hand over the Zohar’s letters can give spiritual insight, and its physical presence provides protection from harm. (The talismanic powers of the Zohar remain a central tenet of Kabbalah Centre teachings.)

In the mid-‘80s, the center began emphasizing donations as a way to ensure members’ well-being, spiritual and otherwise. Consistent with Jewish tradition, followers were urged to give generously beyond the expected tithe of 10% to 20% of their income.

Teachers departed from tradition in telling donors their money should go only to the center: Spreading kabbalah was more vital than the work of homeless shelters and other charities. The center taught that tithing protected donors against financial setbacks, and that additional donations would stave off divine punishment in the form of illness, family strife and other problems.

Karen kept close tabs on fundraising, Youdkevitch and other former members said.

“She was sitting on every chevre in the world: ‘Where are you? How much money are you bringing in?’” he recalled her inquiring. “She would say you have to be outside all day.”

Philip focused on spiritual matters. He prayed six to eight hours a day and continued to write books with Clark. In 1988, Philip published “Power of Aleph Beth.” The first sentence mentioned “Star Wars” director George Lucas runtime:topic> and the cover featured a sci-fi design with Hebrew characters floating under a dark planet.

The book used modern worries such as nuclear war and drug abuse runtime:topic> to give kabbalah teachings a contemporary feel.

There was also a nod to a world-famous pop star.

“We are living in a material world and I’m a material girl,” began the second chapter. Nearly a decade before Madonna attended her first kabbalah class, she served as what Clark called “a made-to-order metaphor for what kabbalah does not teach.”

Part two: Celebrities, secrets and kabbalah

Kabbalah finances: Where the money comes from

harriet.ryan@latimes.com

kim.christensen@latimes.com

Philip and Karen Berg, founders of the Kabbalah Centre, declined to be interviewed for this report and instead issued this statement:

“The Kabbalah Centre is a nonprofit organization leading the way in making Kabbalah understandable and relevant in everyday life. Our funds are used in the research and development of new methods to make Kabbalah accessible and understandable.

“The Kabbalah Centre has received subpoenas from the government concerning tax-related issues. The Centre intends to work closely with the IRS and the government, and is in the process of providing responsive information to the subpoenas.

“The Centre is disappointed that the recent press regarding the Centre and this investigation is being fueled by rumors spread by a few disgruntled former students and former employees with personal agendas. The Centre is confident that the investigation will show that the Centre has and continues to serve its mission and act in furtherance of the wisdom and teaching of Kabbalah.”