The settlement, approved Tuesday by a federal bankruptcy judge, is part of final efforts to recover funds for the victims of [Reed Slatkin], who is serving a 14-year sentence for fraud, conspiracy and money laundering. Authorities say Slatkin led a long-running Ponzi scheme in which money from some investors was used to pay off others.
Millions of dollars more in tainted funds were funneled through other investors to Scientology-affiliated groups, including Narconon International, the Church of Scientology Celebrity Centre International and the Church of Scientology Western United States, the filings said.
Slatkin, who was once an ordained Scientology minister, had maintained that his actions were motivated in part by threats from other church members. In sentencing him to 14 years in federal prison, however, U.S. District Judge Margaret Morrow rejected his claim that he had acted under "duress and diminished capacity" because fellow Scientologists pressured him to continue paying them profits.