The Underground Bunker has learned that a multi-county Oklahoma state grand jury has been empaneled to look into criminal insurance fraud allegations against Scientology’s flagship drug rehab facility, Narconon Arrowhead.

Scientology’s celebrities — Tom Cruise, John Travolta, and Kirstie Alley — have each promoted Scientology’s drug rehab network, Narconon, as a model program. But revelations about Narconon’s deceptive business model — that it offers Scientology training rather than drug counseling, for example — has resulted in an increasing number of law enforcement investigations and civil lawsuits around the country. The network’s flagship facility, Narconon Arrowhead in eastern Oklahoma, has especially been under scrutiny after three patients died in a nine-month period in 2011 and 2012, resulting in county and state investigations of the facility.

Last year, a similar Narconon center in the Atlanta area was shut down following a wrongful death lawsuit and a state and county investigation of insurance and credit card fraud, which is ongoing. Now, we’ve learned that the state of Oklahoma is also investigating insurance fraud allegations regarding Narconon Arrowhead.

We learned about the grand jury from Eric Tenorio, a former Narconon Arrowhead executive who has been open about his attempts to alert authorities to the deceptions he witnessed while working at the rehab facility. Last month, we learned that complaints submitted by Tenorio had resulted in a daunting new lawsuit by the National Association of Forensic Counselors, who named 82 defendants — including Scientology leader David Miscavige — and alleged that Scientology and Narconon conspired to misuse NAFC certifications to make Narconon appear more legitimate than it actually is.

Yesterday, Tenorio was served with a subpoena ordering him to appear in Oklahoma City on June 13 to testify before the multi-county grand jury.

Tenorio tells us that he also talked to Oklahoma’s deputy insurance commissioner, Paul Wilkening, who told him he has also been subpoenaed to testify before the panel.


As to what he plans to testify about, Tenorio tells us he has e-mails he received from Narconon CEO Gary Smith regarding Arrowhead’s plans to expand the facility’s applications for insurance coverage, as well as his first-hand conversations with Smith about such plans.

In March last year, we broke the news that Smith had been stripped of his NAFC certification after the NAFC learned that he had not reported that three deaths had occurred at the facility. Smith is named as a defendant in the NAFC lawsuit, accused of continuing to advertise his NAFC certification online after it was taken away. (Smith has never returned our numerous phone messages over the last two years.)

Last night, we called Robert “Murph” Murphy, father of Stacy Dawn Murphy, who died of an overdose at Narconon Arrowhead in July 2012. We happened to catch him while he was camping, and informed him of Tenorio’s subpoena.

“This is a big one,” Murphy told us. “This could end up doing what happened in Georgia, where the Narconon there was shut down.”

If so, it might put out of business a facility that is already in trouble. In April, we made public internal documents at Narconon Arrowhead which showed the rehab center is seriously struggling, with only about 45 patients at a facility designed to hold more than 200.

Here’s a copy of the subpoena that Eric Tenorio received…

Eric Tenorio Subpoena, Oklahoma Grand Jury by Tony Ortega



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Ryan Hamilton makes it a baker’s dozen

Las Vegas attorney Ryan Hamilton has filed his 13th federal lawsuit against Narconon, Scientology’s drug rehab network.

In this case, Indiana resident Monica O’Connell was searching for a place to send her son Sean for rehab in February last year. A representative from a supposedly generic website suggested that she talk to someone at “Redwood Cliffs” in Watsonville, California.

She wasn’t told that the facility was part of the Narconon network, let alone affiliated with Scientology. She was told the usual deceptions about what would happen at Narconon, and was asked to pay $35,000 to enroll her son.

Like so many others, Sean soon learned that instead of drug counseling, he’d be doing Scientology training, and was subjected to an unscientific sauna-and-vitamins regimen.

Despite [Narconon Northern California]’s representations that Jimmy would receive counseling, at no point did staff ever speak to Sean about the specifics of his life or his drug use and its causes. In fact, no one at NNC ever spoke to Sean about his substance abuse at all. Instead, counselors at the NNC center attempted to treat Sean using only Scientology. Monica O’Connell has attempted to obtain insurance coverage for some of the NNC program’s cost. Plaintiffs’ insurer has denied the claim, however, because NNC did not provide records so the claim could be processed. NNC drug-tested Sean O’Connell during his stay at NNC. Plaintiffs received a bill for approximately $15,000.00 for drug testing at the end of his stay at NNC. Although Plaintiffs had never provided NNC with the insurance information for Plaintiff Sean O’Connell’s father, NNC attempted to submit the charges for the drug testing to his father’s insurance. Sean left Redwood Cliffs without receiving any of the substance abuse treatment Plaintiffs had been promised. Sean sustained liver damage due to the extreme doses of Niacin NNC had Sean ingest during his participation in the sauna program.

Here’s the complaint…

O'Connell v. Narconon Complaint



By our count, that’s thirteen federal lawsuits Hamilton has filed against Narconon in California, Nevada, and Colorado.

Angelo Amato (San Diego)

Christy Estrada and Branden Chavez (San Diego)

Cathy and Michael Tarr (Nevada)

Harry and Lauren Geanacopulos (Nevada)

David, Stacy, and Jack Welch (Nevada)

Bryan and Nikki Mott (Colorado)

Charles and Tyler Matthys, and Linda Phillips (Colorado)

Kenneth and Jered Mowery (Watsonville, CA)

Robin Jones, James Ramirez Sr. and Jr. (Watsonville, CA)

Charis Yates, Beret and Dean Pugh (Nevada)

Lori, Ryan, and Jilliene Winchell (Nevada)

Ben Levy (Colorado)



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Posted by Tony Ortega on June 11, 2014 at 07:00

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