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Lifetime rehabilitation concept
Beginning in 1974 the authorities began to question Synanon's promises and practices. The concept of "lifetime rehabilitation" did not agree with therapeutic norms, and it was alleged that the group was running an unauthorized medical clinic, and that on remote properties in California such as Tomales Bay in Marin County and Badger, Tulare County, the organization had built unpermitted buildings, a trash dump and an airstrip. Tax issues arose. In response to these accusations, Dederich declared that Synanon was a tax exempt religious organization, the "Church of Synanon."
The problems remained despite the changes. Children assigned to Synanon began running away, helped by an "underground railroad" that sought to return them to their parents. Beatings of opponents and ex-members, "splittees," occurred across the state. A Grand Jury in Los Angeles issued a scathing report in 1978 attacking Synanon for its child abuse and for the profits that flowed to Dederich, and also attacking authorities for their lack of oversight. Remarkably, the authorities refused to intercede. Though local newspapers and broadcast media covered the case, they were largely silenced by lawsuits from Synanon lawyers charging libel. Those suits ultimately turned out to be Synanon's undoing, giving journalists access to internal documents.