I got some fan mail over this one. I got threatened with "an expensive legal battle" and, more or less, with the wrath of the almighty. Korem doesn't like me. Do I look unhappy? No. Actually, I think he's got a good point in some ways. The world's nation states get to lord it over we peasants rather more than can possibly be good, so getting a slice of the action looks like a good bet. Alas, I deleted the email he sent me when I upgraded. (really, I should take more care of my files, shouldn't I?)

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The best way to get rich is to start your own religion. Whoever actually said it (and the Church of Scientology has to my knowledge lost at least one court action on the subject) it's true. The more ambitious might found their own nation. If that new nation is a theocracy as well, you've killed two birds with one stone and made a good start toward living the life of old Reilly. This isn't as far-fetched as it sounds.

Want total freedom from tax and financial regulators? A diplomatic passport? A banking charter? Try the Dominion of Melchizedek, a new country with territories all over the place and genuine(-ish) international recognition.

Sometime in the early '80s, a Californian preacher and conman named E. David Pedley realised that thumping the same Bible as everyone else was a mined-out market. So, he composed the Melchizedek Bible (see sidebar) , and had a few thousand copies printed. There's nothing wrong, per se, with re- editing the Bible; after all, there is respectable argument about whether some religious texts are properly biblical: the Apocrypha are the main examples. They, though, are hallowed by antiquity, so we can distinguish them from the "extras" of more modern and debatable provenance, the most famous "extra" being the Book of Mormon.

It takes no great leap of the imagination to see that a lack in the modern Bible might be remedied by an inspired author, and, being so inspired, Pedley was able to make even more money on the preaching circuit. This was not his only business, however. He and his son formed a formidable swindling team, well known to California's police and prisons. In 1986, Pedley senior, now calling himself David Wellington, was named as a co-defendant in two trials at which Pedley junior was convicted of currency and land fraud, but avoided joining his son in the dock by being in a Mexican jail, along with a lady friend.

While Pedley Junior, then known as Mark Wellington, was beginning his nine year sentence, a corpse was produced by the Mexican authorities and identified as David Pedley's. There's some doubt as to whether it was actually him, as rumour has it he has since been seen alive. Either way, he was recognised as a world- class con artist; one of that elite among crooks who could run a scam from inside a jail.

As to where he got the idea for the Melchizedek Bible, there is a clue to be found in Vallee's Messengers of Deception. A number of UFO groups around California in the seventies used the name of Melchizedek, claiming that he was a messenger from the stars to "initiate" Abraham. It is, given the geographical and temporal coincidence, not unlikely that Pedley was inspired by or had at least heard of these groups. The extracts from the Melchizedek bible on the Dominion's website do have a slightly New-Age feel about them.

Be that as it may, shortly before he "died", Pedley set up a retreat for retired preachers of Melchizedek. Never mind that he was the only one there ever was - he clearly intended his Bible to take off in a big way. He bought an unnamed Pacific coral island near Clipperton, notable only for disappearing altogether at high tide (This has not stopped at least two "Banks" and a "Financial Centre" opening for business there. Offshore banking at its most literal, at least at high tide.).

This was the biter bit, as he thought he was buying a little slice of tropical paradise. Nevertheless, it was his most lucrative legacy to his son: the first territory of the Dominion of Melchizedek. Pedley Junior changed his name to "Branch Vinedresser"; something more biblical to go with his new role as "Minister Plenipotentiary" of "An Ecclesiastical and Constitutional Sovereignty". Thus renamed, and paroled in March 1990 after the currency fraud, he went into business with a new bank, Banco de Asia. Although this was registered in the Dominion of Melchizedek, he operated from offices by Lake Tahoe. Vinedresser was able to convince the Nevada regulatory authorities that Melchizedek was a real nation. Then, through Banco de Asia he bought a shelf company called Currentsea - which claimed 10% of the world's oceans, valued by him at $1 trillion - and tried to float (pun intended) the company on the stock markets.

His change of name didn't help him evade the law: his wife, Cynthia Wellington, was known to her neighbours as "the one with the husband with the weird religion" and so he was collared for advance-fee fraud and other offences. Nevertheless, his religion remained important to him; from his prison cell he said "I learned it all from my father; I had years of lessons. He was the most godly man I knew."

Vinedresser's legal troubles apart, the Dominion continues to grow in stature as a nation state. By June 1993, it had achieved diplomatic recognition from the Central African Republic, former stamping ground of His Highness the Emperor Bokassa. The President wrote to Minister Plenipotentiary Vinedresser care of the Dominion's Washington DC Embassy offering formal recognition and full diplomatic privileges. I have a copy of that letter; the Dominion will fax it to anyone who questions their right to call themselves a state. The letter also features in the profile which they send out to potential citizens. The profile, which also includes the banking and insurance statutes of the Dominion, contains their rejection letter from the UN, and numerous other letters from national and international bodies (including the EU, Nigerian High Commission in London and US department of Justice) all apparently recognising the Dominion's statehood.

These recognitions, alas, are obtained by methods which would do the makers of Brass Eye proud: Vinedresser writes asking for recognition or membership for the Dominion, and some functionary responds in non-comittal terms which nevertheless treat Melchizedek as a real nation. Still, recognition is recognition, however tenuous. The Dominion's diplomatic relations are one of its chief sources of income. For $5,000 per annum, anyone can be Ambassador-at-large of the Dominion of Melchizedek. Should you have difficulties at immigration or customs, you have only to invite the functionaries there to call the Dominion's Washington DC embassy to have your diplomatic status confirmed and your baggage freed from tiresome searches or seizures.

I have a copy of one of these passports, issued to (or someone who claimed to be) His Royal Highness Prince Gerald D Sayn-Wittgenstein-Hohenstein, which was successfully used to travel in India and China. I'm told he didn't get very far with it at Hong Kong, where he was put on the next plane out after trying to set up a dodgy bank.

The territories of the Dominion are a bit of a mixed bag. As well as Pedley's first acquisition, Malpelo, off the Pacific coast of Columbia, is another island slice of the Dominion. Malpelo featured in the indictment before a Texas grand jury of one Jeffery H Reynolds III (probably not his real name), who was responsible for the wholly fraudulent California Pacific Casualty Insurance. Among the allegations laid against him were that he invented the Dominion of Melchizedek (untrue) and that he falsely claimed his corporation was resident on Malpelo.

Although, from a certain point of view, this was true, he got 54 months in a Texan jail. Nowadays, although the Dominion lists Malpelo as a territory, it admits that there are cross-claims to it.

Another piece of island territory which the Dominion claims was the pacific paradise of Karitane. Part of the Polynesian Te Parata group, it is a tiny (14 square miles) island at 32°S 152°W. Sovereign rights were granted to the Dominion (so they say) on 26th November 1994, making this the only piece of territory the Dominion has which isn't claimed by any other state. They say they are in the process of moving the government's executive arm there, and satellite phone and fax facilities are in place.

The Dominion also has a claim to Jerusalem. As Melchizedek was king of the place back at the start of the second millennium BC, it's only natural that his latter-day Dominion should stake a claim. Of course, there are competing claims, not least that of the Israelis, but this hasn't stopped the Melchizedekians from setting up their locus of government there and looking for sites for a Third Temple, to be their "Millennial Headquarters".

By a "treaty" made on the 20th March 1994, Rut henia (see sidebar) became part of the Dominion, and (according to the Dominion's PR) came one step closer to independence. Apparently measures were put in hand to secure the borders and take charge of any nuclear armaments left behind by the USSR - according to their 1995 profile at any rate - although that seems to have come to naught.

Finally, the Dominion claims 90-150° West Antarctica. Now this might be considered a little controversial as the treaties governing Antarctica prohibit territorial claims, mineral exploitation, settlement and indeed any activity in Antarctica that isn't scientific research and ancillary activities.

What the Dominion purports to do in all these territories is to be a "Transnational Nation State" and "unite... all freedom-aspiring men and women who share the planet, earth." It supports the "shared values common to all men and women to express the needs, wants and aspirations of the third millennium." and "new concepts relating to international organisations and co-operatives - designed to recognise, provide and promote, with international recognition, the horizontal integration of interest groups, institutions and a step toward an internationally united planet." It is governed, supposedly from Jerusalem, by a legislative Council of Elders and an Executive Branch, although the Executive Branch is in the process of setting up on Karitane. It has a Supreme Court to hear appeals (Chief Justice is one B. Vinedresser), but no junior courts to try cases. It used to claim to resort to the Courts of the Commonwealth of the Bahamas for settlement of legal disputes. Whether the Bahamian courts knew they had this jurisdiction is something I haven't been able to discover. They also claim to have a "Special Envoy to the Vatican", an Olympic team, a College of Heralds and a University, along with a small army of "Ambassadors".

What it actually does has nothing to do with any of its purported territories, or any high-minded international ideal. It sells copies of the Melchizedek Bible and provides a cover for a succession of international con games. As well as the aforementioned California Pacific, the Dominion has featured in a number of scams which have made the financial press around the world. A particularly fine example is the Inner Sanctum, a Ponzi scheme backed by, as it turned out, worthless Weimar Republic bonds. Money paid to Inner Sanctum was banked with "Swiss Investment Bank" of Mayfair, London, which was incorporated in the Dominion of Melchizedek and quietly vanished just as the investors discovered that the (huge) payout cheques drawn on it were worthless. The Inner Sanctum itself was closed down last year by the combined actions of the police, the SFO and the DTI.

California Pacific, mentioned above, didn't just sell fraudulent insurance. It also got involved in the long-running Wheatland gold scam, which keeps failing when someone asks difficult questions, like "Where's the gold?". It goes like this: a company based in Dallas, claims to own a warehouse full of gold ore, named "Wheatland Warehouse". No address is given and its location is described as a "big secret" (although during the first attempt, in 1991, an address was grudgingly given and turned out to be that of a business park unit occupied by a ceramics manufacturer). The company produces an insurance certificate for the gold (of which the insurers later deny all knowledge, alleging it to be a forgery) and tries to use it as collateral for huge loans to be used in unspecified "investment deals" or, in one variation, "movie financing". The whole deal has failed no less than three times.

Lest you think that the Dominion sits back and lets its citizens do all the swindling, there is a report of their President's troubles with California State regulators over her alleged involvement in a fictitious bank called "Asia Pacific". The President of the Dominion, a Mz. Pearlasia (also known as Elvira Gamboa), seems to have taken over the leadership from Vinedresser (as we must now call him, although he prefers the Hebrew form "Tzemach Korem") as he is demoted to "Vice President", "Head of the House of Elders" and "Chief Justice of the Supreme Court" in their latest profile. She takes most unkindly to being served with court orders. When ordered to cease and desist with her alleged operations with the "Asia Pacific Bank", she sent a "Declaration of Spiritual War" to the State's Attorney, in her capacity as the President and Commander in Chief of the Dominion of Melchizedek.

She later threatened "metaphysical battle" and to attack him in his dreams. "If you interpret your dreams correctly you will know I am the victor," she said. As well as denying that she was involved in banking activities of any kind, she took the logically adventurous step of suggesting that if the State of California denied that Melchizedek existed, she therefore had the right to deny that California existed.

The sad part of the Dominion's story is that this superb concept has been used predominantly for crimes and deceptions; even the religious angle seems to be secondary. If they were to, say, lower the entrance fees and advertise a little more widely, there might really be a market for a challenge to the current oligopoly on statehood. For the price of having only to read a certain amount of off-the-wall biblical scholarship, we could all take part in what might be the next big thing in political organisation.

Either way, the Dominion is not about to go away. Despite occasional calls in the Financial Services press for the Washington DC regulators to shut down the embassy and put a stop to the con games, I suspect that they will be left more or less alone. The Dominion is quite cheerful about publishing the names of its "Diplomats", with the result that although the crooks become better able to shift their ill-gotten gains around that part of the world which regards an embassy in Washington as the hallmark of a real nation, they can be more easily traced as to their current aliases and activities. At least the Dominion is good for something.

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