Exploring the Connections documents how Family Care Foundation (FCF), a California
public benefit corporation, is an illegal front organization for The Family, an unregistered
high-demand, secretive, apocalyptic religious group with a long history of promoting the
sexual abuse of minors and practicing religious prostitution. FCF has deliberately concealed
its close working relationship with The Family from the IRS, other regulatory agencies, and
the public. Formed in 1997, FCF is controlled by an all-Family Board of Directors and was
initially funded by The Family. The FCF president and executive director have secretly
collaborated closely with top Family leadership on a number of projects. These include
using FCF funds to finance Family ventures, collecting Family tithes, paying Family
apologists, and according Family members preferential treatment.
Family Care Foundation
The Family / Children of God
Exploring the Connections
Exploring the Connections also provides information about other Family front
organizations, explaining how they are interlinked. Suggestions for further research are
offered, including several websites, as well as contact information of the various
organizations mentioned in the report.
This document explores the relationship between the high-demand apocalyptic religious
group known as The Family (formerly the Children of God) and Family Care Foundation
(FCF), a public benefit corporation based in Dulzura, California (EIN 33-0734917). It is
assumed that the reader already has a knowledge of The Family – their history, beliefs, and
The top leaders of The Family formed FCF in early 1997 in order to advance their goals
In 1996, Family leadership was exploring ways in which The Family could become a
tax-exempt legal entity in the U.S. This was desirable for a number of reasons.
(David Berg [1919-1994], the founder of The Children of God/Family, advocated adult-child
sexual contact in his published writings. His wife/mistress Karen Zerby (aka Queen
Maria) is the current leader of the Family, along with her husband Chris Smith (aka Steve
Kelly, Peter Amsterdam, King Peter). They both live in hiding. Zerby and Smith promoted
Berg's sexual doctrines and practices.
- The Family could solicit large donations and broaden their base of financial
- The Family could mass-market their publications and videos, spreading the
message and obtaining income.
- It would provide legitimacy and credibility for those Family members who were
becoming active in charitable activities but could not attract tax-exempt donations.
They wanted to be affiliated with a legitimate, credible organization. It was risky to
publicly identify oneself as a member of The Family a heretical "church" that did
not officially exist and had a sordid history of promoting religious prostitution and
the sexual abuse of minors.
(From the late 1970's until the late 1980's, Family members sexually abused thousands
of children in Family communities. While adult-child sexual contact is no longer officially
tolerated, Zerby and Smith deliberately conceal the extent to which it occurred and their
part in promoting it. They also refuse to pay the victims any compensation.
(Religious prostitution, or “flirty fishing,” was a fundamental doctrine and practice of
The Family from 1976 until the mid 80's, when it was banned due to AIDS. The practice
raised millions of dollars for the group. Zerby contends that flirty fishing was never
Zerby and Smith considered having the Family become a registered tax-exempt church.
They rejected this option for several reasons.
A meeting with a consultant led to the idea of forming a non-profit foundation, known as a
public benefit corporation. Zerby, Smith, and Grant Montgomery, their Prime Minister and
the third-ranking Family leader, saw several advantages to forming a foundation.
- The IRS' stringent conditions for granting tax-exempt status to churches might
disqualify The Family.
It would demand an unacceptable level of financial and administrative scrutiny and
It would expose The Family to lawsuits and criminal charges by former members,
many of who had been sexually abused as children in the group. This abuse
occurred as a direct result of Berg and Zerby's teachings.
- It generally had a better chance of receiving tax-exempt status than a church.
- Less information was required. No need for doctrinal statements or names of church
officers and pastors. A few people, identifying themselves as directors, could apply.
- There was no need for a connection to The Family and its controversial practices.
- Family members could become “project managers” of a squeaky-clean foundation
and fundraise under a tax-exempt umbrella.
- It could legally and respectably mass-market Family videos and books.
- It could raise substantial tax-exempt funds that could, with a little creative
bookkeeping, be used to finance ventures that Zerby and Smith controlled through
World Services (WS), the administrative arm of The Family.
- Zerby, Smith, and other Family leadership could continue to operate free of any
third party scrutiny and accountability.
- Legal firewalls between the foundation and The Family could blunt potential
lawsuits and criminal charges against The Family.
In early 1997, FCF incorporated in California. During the application process, no mention
was made of The Family and its support of FCF, nor that the President of FCF, Grant
Montgomery, was the Prime Minister of The Family. To acknowledge any connection with
The Family would have doomed the application. A few months later, the IRS granted FCF
501(c) 3 status.
The Directors of FCF, with one exception, have always been trusted Family members.
Some chosen for their ability, all for their tried and proven loyalty to Zerby and Smith.
The President of FCF is Grant Montgomery (aka Gary or Paul Papers in The Family).
Prior to starting FCF, Montgomery had been Prime Minister of The Family for seven years, during which time he lived with Berg, Zerby, and Smith, helping create and enforce Family
policies and practices. Internal Family publications of the time make frequent reference to
him. Montgomery remained Prime Minister after FCF incorporated and conferred regularly
with Zerby and Smith on a wide range of issues. Again, this is documented in internal
In August 1997, Zerby and Smith published Family Specials Magazine (FSM) # 320,
in which they and some FCF/Family members officially introduced FCF to Family
members worldwide. Describing the process, an FCF staffer wrote
This paperwork took almost three months to complete, at which time it was sent in to the IRS for
approval. After incorporating in January 1997, in March the Foundation was approved by the IRS as a
separate and independent tax-exempt, non-profit legal entity named "Family Care Foundation" (FCF).
The decision-making body of the Family Care Foundation is its Board of Directors, of which Gary is
president (italics added).
In the May 15,1997 edition of the Family newsletter Grapevine (#19), Montgomery's
upcoming wedding was announced under the byline “WS News.” (Italics added)
Up-and-coming wedding bells!
We're happy to announce that our dear Prime Minister and longtime WS bachelor of 15 years,
Gary, is heading down the marriage aisle! He met his lovely bride-to-be, Sharon (24, of Arthur and
Becky), then a single mother with three children, in California about nine months ago.
Earlier in April, the Grapevine (#17) reported that Montgomery had traveled to Japan,
where he had extensive talks with Smith (King Peter).
After his visit to the HCS [Family community in Japan], Peter spent three days with Gary, discussing,
praying and hearing from the Lord regarding the GPU, and their working relationship with the IVM
and music departments, and the myriad of business details and decisions to be made on those fronts.
Montgomery resigned as Prime Minister in 1998, but continues to be influential in the
group and communicates regularly with Zerby and Smith.
Montgomery and FCF executive director Lawrence Corley are the "engines" driving
FCF. Corley has been a Family member for over 20 years. Some of the current Directors
are "rubber stamps," showing up for meetings and approving Montgomery's proposals.
FCF's first registered principal place of business was the residence of another Family
member and FCF Director, Dr. Chris Mlot. Her large villa (10612 S. Morada Drive,
Orange, California 92869-1505) was also the western headquarters of The Family, known
as the LAMB (Los Angeles Missionary Base). At any given time, 30-50 Family members
lived there, including Tom Hack (aka Abner), an FCF Director and top Family leader for
the U.S. The Family operated its official toll-free 800 telephone line at this address.
Montgomery and Corley knew that FCF had to build and maintain legal firewalls for two
To this end, Montgomery and Corley regularly sought legal counsel to ensure that they
followed correct procedures. For their part, Zerby and Smith exercised caution in how they
referred to FCF in internal Family publications. In FSM 320 they explained that some
Family members, led by Montgomery, had decided to form a foundation, and that Zerby
and Smith morally supported them in their efforts.
- To conceal the extent to which Family leadership funded FCF's operations.
- To conceal the extent to which Zerby and Smith directly and decisively influenced
how FCF operated and managed its finances. Zerby and Smith regularly
corresponded with Montgomery, collaborating on different ventures. This
relationship had to be concealed so that FCF would not be exposed as an illegal front
organization of the Family.
Montgomery and Corley built firewalls into the FCF financial accounts. They had to
conceal the considerable extent to which The Family financed FCF, especially in 1997.
Housing the 15 adult Family members, the fulltime “volunteer” staff of FCF, cost $3,000 a
month just for rent. Family officers creatively laundered these funds. For a while,
mysterious Japanese donors (Family officers) sent untraceable International Money Orders
to FCF. The FCF accounts will not reveal the Family's financial support, but it existed.
For a period of time, FCF was an off-the-record collector of tithes for The Family. (All
Family members must tithe 11% of their cash income to WS.) This situation arose due to
complaints by Family members about double taxation.
Typically, a few Family members would apply to become an FCF "charitable project,"
submitting an operating plan. FCF would approve the application and authorize the new
"project managers" to fundraise in the name of FCF. Donations for that project would go to
FCF, who deducted an 11% handling fee and passed the remainder to the project managers.
Soon there were hundreds of projects, and some complained that they had to pay both
WS and FCF a “tax” on every donation. To remedy this, Zerby, Smith, and Montgomery
struck an off-the-record deal that any donation to FCF was exempt from the WS tithe. The
11% handling fee was another way that The Family financially supported FCF. This method
required that The Family and FCF bookkeepers exchange information regularly.
FCF almost exclusively promotes Family products and assists Family members. This
obvious sponsorship of The Family is one of their Achilles' heels, as it reveals FCF's role as
a front organization for The Family. To provide an illusion of transparency, in 1999 the
Directors passed a resolution stating that FCF favors and gives special consideration to
projects sponsored by Family members. This resolution, documented in the meeting
minutes, provides more evidence of the working relationship between FCF and The Family.
FCF actively solicits large donations from the public. Such donations are often
"undesignated," in that FCF can use them however it sees fit. After some large
undesignated donations to FCF materialized in 1998, Zerby and Smith suggested that
Montgomery and Corley use the funds to finance some WS ventures.
(Zerby and Smith use the tithe money to finance projects they view as vital to the
Family. This includes but is not limited to: 100% funding of their residence and large staff;
100% support of the staff and dependents of WS offices that produce essential Family
publications; several Family field officers; and some "missionary" endeavors.)
Zerby and Smith asked Montgomery to use FCF funds to finance two WS projects. The
first was the East Europe Mail Ministry office in Hungary. For years this operation, staffed
by Family members and funded by WS, had translated, printed, and mailed Family
publications to hundreds of thousands of people in Eastern Europe and the former Soviet
Union. The second was a similar operation in Thailand.
Montgomery and Corley agreed to Zerby and Smith's request. To facilitate the process,
both groups applied for and were immediately granted FCF project status. The East Europe
Mail Ministry office became the "East European Christian Correspondence Center
(EECCC)," project No. 98-E03. The Thai operation became Asia Vision, project No. 98-
A03, still on the FCF website. In 1998 and 1999, FCF gave the EECCC $63,000 from their
general fund. In the period 1998 – 2002, FCF gave $43,000 to Asia Vision.
These figures can be found in the FCF 990 forms for the respective years and in the
FCF Annual Report for 2000.The Annual Report can be viewed at the FCF website. The
990 forms can be viewed online at:
1998: Page 21. http://documents.guidestar.org/1998/330/734/1998-330734917-1-9.pdf
1999: Page 29. http://documents.guidestar.org/1999/330/734/1999-330734917-1-9.pdf
2000: Page 36. http://documents.guidestar.org/2000/330/734/2000-330734917-1-9.pdf
2001: Page 27. http://documents.guidestar.org/2001/330/734/2001-330734917-1-9.pdf
2002: Page 23. http://documents.guidestar.org/2002/330/734/2002-330734917-1-9.pdf
This freed over $100,000 of WS funds for other vital Family projects.
FCF has also given money to an apologist for The Family, J. Gordon Melton. In 2000,
FCF gave $10,065.83 to Melton, an academic who has defended The Family for years.
The Family funded and edited Melton's 1994 book about The Family, Sex, Slander, and
Salvation, and advertise it on their website. His latest work is The Children of God
(Signature Books. 2004) The Family website also lists Melton as an “expert.”
Further evidence of the strong FCF – Family connection can be found by examining some
other Family front organizations.
For several years FCF marketed the video Countdown to Armageddon as well as the
video series Treasure Attic. The Family produced these videos in Tateyama, Japan. Robert
Fernandez, a Director of FCF and Family member, is the star character of Treasure Attic.
Several other Family-controlled organizations also promote these videos.
Aurora Production AG. (www.auroraproductions.com) Zerby and Smith started this
secretive company, based in Zug, Switzerland, in 1998. It owns the copyrights of all
revenue-producing Family music, publications, and videos (including Countdown to
Armageddon and Treasure Attic), and licenses them to Family projects, such as Activated.
Activated Ministries. (www.activated.org www.activatedministries.org) A Family–operated charitable foundation in Escondido, California (EIN 33-0857142). All the
Directors are Family members. Tom Hack, a high-ranking Family officer and former
director of FCF, is the President. Activated is a licensed distributor of Aurora products
worldwide, including the magazines Activated and The Wine Press, both of which promote
Family beliefs and practices. It is The Family's largest outreach operation. Activated openly
acknowledges its support of The Family and links to The Family website. Activated has
also made at least one cash donation to FCF.
The Family (www.thefamily.org) promotes Aurora and Activated, according each
organization a web page and providing links. It also markets Treasure Attic.
The Family's newsletter, The Grapevine, also documents the Aurora–Activated–Family
connection. The July 2000 edition, contained statistics for the three public websites.
Distinct Visits: 18,299
Daily Average: 590
Total Downloaded: 3.5 gigs
Distinct Visits: 1,492
Daily Average: 48
Total Downloaded: 74 MB
Distinct Visits: 733
Daily Average: 23
Downloaded: 69 MB
The Family also runs a lesser-known foundation in Texas, Teaching, Education and More
(TEAM) Foundation (EIN 75-2790783). Its Directors are all Family members. Gayle Kelly
(aka Abi, Abigail, Damaris) is the wife of King Peter and a top US leader of The Family.
David Forsberg (aka Simon) is also a leader.
• Ask FCF for a copy of their incorporation papers, by-laws, and minutes of their
Board of Director meetings. The IRS requires that FCF keep these at their principal
place of business and make them available for public inspection. Members of the public
may also request that FCF copy and mail such documents to them.
• Contact FCF and request details of the relationship that exists between The Family
and FCF. Why are the FCF Directors all members of The Family? Why is Ken Kelly, the
biological brother of Chris Smith, husband of Chris Mlot, and a Family member, on the
Board of Directors? Why does FCF support The Family?
• Ask FCF why it no longer sponsors projects in the U.S. It previously had several
dozen domestic projects, and they suddenly vanished. What happened to them?
• Call The Family and request information on the relationship between FCF and The
• Learn more about The Family. Do a search engine query for The Family, Children of
God, and David Berg.
• Do a search engine query for Family Care Foundation. Ask charities that partner
with FCF if they are aware of the FCF—Family connection, and if so, do they approve
• Ask the San Diego media if they are aware of the FCF—Family connection.
[ homepage ]