Swami’s Troubles Tarnish Life at ‘Palace of Gold’ : Sects: Allegations of murder and racketeering have reversed fortunes at Hare Krishna offshoot’s West Virginia center. But devotees are going ahead with their plans for a multi-faith community.

A shroud of trouble hangs over the hilltop Palace of Gold, built as a glittering monument to the Indian swami who brought the Hare Krishna religion to the United States.

In its heyday in the 1980s as America’s largest Hare Krishna community, New Vrindaban grew into a major tourist attraction with 250,000 visitors a year. The money was flowing in.

Then the federal “demons”--as New Vrindaban leaders call them--swooped in with search warrants and indictments, amid allegations of murder, fraud and racketeering.

Now Kirtanananda Swami Bhaktipada, spiritual leader of New Vrindaban’s faithful, is awaiting retrial on federal racketeering charges. The busloads of tourists--and their dollars--have dwindled. And the mainstream Hare Krishna movement has distanced itself from New Vrindaban.

But the 250 remaining members of the New Vrindaban community are moving ahead with plans for a new multi-faith community and efforts to bring the tourists back to their marble-and-gold palace.

“We’ve been smeared as being criminal and this and that, but if you look at the facts, it doesn’t bear it out,” says New Vrindaban spokesman P.K. Swami, 45. “And yet we get this reputation of being this wild criminal organization. It’s really unfair.”

Allegations of violence and wrongdoing in the mid-1980s seemed as incongruous to the community as the Palace of Gold seemed out of place in the hills of West Virginia, about 80 miles southwest of Pittsburgh.

Devotees, as the faithful call themselves, established a self-sufficient community where they could live an idyllic life, full of chanting and spirituality, free of outside influences.

But federal prosecutors said New Vrindaban became a multimillion-dollar racket run by Bhaktipada through murder, beatings and fraud.

“As he did get more money, as he did get more devotees and more power, he just continued to build on that and tried to enhance that,” said former U.S. Atty. William Kolibash, who twice prosecuted Bhaktipada.

“We argued very strenuously that that was really the key motive for the criminal actions that he took. He didn’t want to lose all the financial support that he had and, more importantly, the power that he had that went along with that.”

In 1987, the International Society for Krishna Consciousness, Hare Krishna’s mainstream organization, said it had had enough of Bhaktipada and his attempts to further Westernize the religion and excommunicated his community.

Bhaktipada calls his community’s troubles with the Justice Department a “struggle between the demons and the devotees.”

“We are being persecuted. That’s human nature,” Bhaktipada said. “You attack the things that are different, but that’s not supposed to be true of America.”

Bhaktipada, the son of a Baptist minister from Peekskill, N.Y., quickly rose in the Krishna hierarchy after becoming the first Western disciple of A.C. Bhaktivedanta Swami Prabhupada, founder of the International Society for Krishna Consciousness.

Prabhupada died in 1977 and devotees led by Bhaktipada expanded the temple and built a memorial to him. It opened to tourists two years later and the community flourished.

But a dark side began to emerge in 1985.

* Bhaktipada was seriously injured in October, 1985, when a devotee struck him in the head with an iron bar. The devotee told authorities he wanted to “cleanse the church.”

* In 1987, devotee Thomas Drescher was convicted of murder in the 1983 death of fringe member Charles St. Denis at New Vrindaban. Devotee Daniel Reid pleaded guilty to voluntary manslaughter and testified against Drescher.

* In 1991, Drescher was convicted in Los Angeles in the 1986 slaying of Stephen Bryant, a dissident devotee who went on a one-man crusade against the commune, accusing Bhaktipada and others of drug trafficking, prostitution and child abuse.

* Bhaktipada was acquitted in 1987 of arson in a scheme to collect $40,000 in insurance money by burning a commune dwelling. Drescher was convicted.

* Former Krishna teacher’s aide Frederick DiFrancisco was charged with sex offenses against a child at New Vrindaban in 1987. DiFrancisco pleaded guilty and went to prison for six months.

* Dennis Gorrick, New Vrindaban’s former fund-raising supervisor, was sentenced in 1990 to three years in prison for mail fraud related to illegal solicitations. Officials said more than $10 million was taken in.

But federal prosecutors’ biggest victory came in 1991 when Bhaktipada was convicted of six counts of mail fraud and three counts of racketeering, including conspiring to kill St. Denis.

Devotee Terry Sheldon also was convicted of racketeering and conspiracy to commit murder and mail fraud.

The indictment charged that the community made and sold millions of caps, bumper stickers and T-shirts bearing copyrighted and trademark cartoon characters and sports logos, netting at least $10.5 million between 1980 and 1985.

Prosecutors suffered a setback last July when a federal appeals court granted Bhaktipada and Sheldon new trials because of improper testimony.

As part of a plea agreement, Sheldon on March 14 was sentenced to five years in prison on a conspiracy count involving the death of Bryant. Bhaktipada is scheduled to go to trial later this year.

“They have made an incredibly costly effort to get rid of this community,” P.K. Swami said. “I think the taxpayers should start wondering what they’re doing, whether it’s worth the money.”

Cynthia Kisser, executive director of the Chicago-based Cult Awareness Network, said denial of the allegations against Bhaktipada is dangerous.

“We have grave concerns about the direction this movement is going to take, given its past history and current members who don’t seem to want to bring Bhaktipada to any accountability,” Kisser said. “That’s not a good indicator.”

Today, about 250 people, a third of them children, live in New Vrindaban. There were as many as 700 people in the mid-1980s.

Despite legal fees and a decline in financial support, the community plans a “spiritual village.”

The vision calls for 22 sites where different religions can establish villages to promote their faiths. All of the villages would then be known as the “City of God.”

“Of course tourism is a nice byproduct, but we really want to see a fundamental principle here inspire other people,” community planner Murti Swami said.

Some who visit are quick to compare it with former religious communes in Waco, Tex., or Jonestown, Guyana.

“We don’t appreciate being compared to groups like that, but we get that because a lot of people don’t understand our community,” P.K. Swami said.