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Nxivm lieutenant sentenced in Brooklyn federal court for illegally spying on ‘enemies,’ altering evidence

September 8, 2021 Brooklyn Eagle Staff
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On Wednesday, Nancy Salzman, the former president and co-founder of Nxivm, often described as a sex cult and a sex-trafficking operation, was sentenced to 42 months’ imprisonment and ordered to pay a $150,000 fine by U.S. District Judge Nicholas G. Garaufis in Brooklyn federal court.

She had been charged with racketeering conspiracy, including predicate acts of conspiracy to commit identity theft and conspiracy to obstruct justice. 

Salzman, who pleaded guilty in 2019, agreed to forfeit several real properties, more than $500,000 in cash and a Steinway grand piano. Salzman pleaded guilty in March 2019. 

For more than a decade and until her arrest in July 2018, Salzman, who was known in the group as “Prefect,” was a high-ranking member of a criminal enterprise led by her co-defendant Keith Raniere, known as “Grandmaster.” 

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Until last month, when he was transferred to a federal prison in Arizona, Raniere was held at the Metropolitan Detention Center in Sunset Park, Brooklyn, and a group of people alleged to be Nxivm supporters held nightly dances outside the Brooklyn jail in support of inmates. Nxivm executive board member Clare Bronfman, heiress to the Seagram liquor fortune, is also at the MDC, according to published reports.

U.S. District Court Judge Nicholas Garaufis. Eagle file photo by Rob Abruzzese
U.S. District Court Judge Nicholas Garaufis. Eagle file photo by Rob Abruzzese

According to the U.S. Attorney’s Office for the Eastern District, the primary purpose of Raniere’s enterprise was to promote himself and recruit individuals into various purported self-help organizations that Raniere founded, including Nxivm and affiliated programs, and a secret society within Nxivm called “DOS.” 

Between August 2005 and November 2008, Salzman, along with Raniere, participated in the unlawful surveillance and investigation of perceived critics and enemies of Raniere and Nxivm. As part of the scheme, Nancy Salzman agreed to unlawfully surveil these perceived enemies in an attempt to gain advantage over them and stop them from criticizing the group, the U.S. Attorney’s Office said. 

On March 27, 2018, a search warrant was executed on Salzman’s residence. Law enforcement agents recovered a box containing purported private banking information of many individuals perceived to be critics and enemies of Raniere, including journalists, judges and an expert on cults. 

Acting U.S. Attorney for the Eastern District of N.Y. Jacquelyn M. Kasulis. Photo courtesy of U.S. Attorney’s Office

The defendant also conspired to obstruct justice by altering videotapes that were to be produced in discovery in a federal lawsuit in New Jersey. In 2003, Nxivm and affiliated entities filed a copyright infringement suit against a former Nxivm student, her parents and a cult deprogrammer. In 2008, however, attorneys representing the former student filed counterclaims against Nxivm, alleging that the defendant had misrepresented the nature and effectiveness of Nxivm’s programs.

During the course of the pending litigation, Salzman and others agreed to alter the videotapes to remove segments that they believed would have supported the former student’s claims and to make it look as if the videos were unedited. These altered videotapes were then produced in discovery by Nxivm’s attorneys with the false claim that they were provided in “unedited fashion.” 

Raniere was convicted by a federal jury of racketeering and racketeering conspiracy, sex trafficking, attempted sex trafficking and sex trafficking conspiracy, forced labor conspiracy and wire fraud conspiracy. On October 27, 2020, Raniere was sentenced to 120 years’ imprisonment. 

Jacquelyn M. Kasulis, acting United States attorney for the Eastern District of New York; Michael J. Driscoll, assistant director-in-charge, FBI New York Field Office; Thomas Fattorusso, acting special agent-in-charge, Internal Revenue Service-Criminal Investigation, New York;  and Peter C. Fitzhugh, special agent-in-charge, Homeland Security Investigations, New York, announced the sentence. 

“In her misguided loyalty and blind allegiance to Keith Raniere, the defendant engaged in a racketeering conspiracy designed to intimidate Nxivm’s detractors and that inflicted harm on Nxivm’s members,” said Acting U.S. Attorney Kasulis. 

“Serving as Raniere’s right hand for more than a decade, Nancy Salzman’s conduct supported Nxivm’s objectives to recruit victims, stave off critics and alter evidence connected to a federal lawsuit,” said FBI Assistant Director-in-Charge Driscoll.

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