There are no grounds for this conspiracy theory, even though it does the rounds.

Since 2001, the New Kadampa Tradition ~ International Kadampa Buddhist Union (NKT-IKBU) has been following A Moral Discipline Guide ~ The Internal Rules of the New Kadampa Tradition. These NKT Internal Rules show that the NKT-IKBU has many built-in democratic checks and balances. Power is shared between the Spiritual Director, the Managing Directors, and the Education Council.

For example, the Board of Trustees nominates a candidate for General Spiritual Director (GSD). The members of the Education Council (the Resident Teachers of NKT Centers) then vote as to whether or not they approve of this nomination. Even after being elected, the GSD is under the supervision of the Education Council, who is charged with removing the GSD or Deputy Spiritual Director if their behavior is inappropriate. The officers and trustees of the Charity are all elected by the members of the Education Council. Within individual Centers, the Administrative Director, together with the other local members and all the members of the NKT Education Council and the GSD, are charged with monitoring the behavior of the Resident Teacher. The list goes on. See the Internal Rules.

It is true that there are elected officers both within the NKT Education Council and at local NKT Centers who are charged with running the day to day business. However, this does not make them autocratic insiders; rather it makes them elected functionaries who work under layers of supervision and oversight.

Democracy

When Geshe Kelsang introduced the Internal Rules in 2001, he said:

We know that every religion, every organisation, every family or group – even a couple – have some Internal Rules or internal traditions. Everybody has these. Sometimes we say that a family has their own traditions, which they carry strictly. In reality, this means their Internal Rules. Everybody has these. So we need these. Generally we say ‘Internal Rules’ but in reality our organisation is a religious or spiritual organisation or community, so of course our Internal Rules are a moral discipline guide. We need this. I believe this moral discipline guide will solve many problems in the future. It will guide you in a correct direction and prevent you from going in a wrong direction.

… We cannot copy the Tibetans because our societies are completely different — our tradition, culture, life, society, lifestyle, and way of life are completely different. We cannot do like Christians, we cannot do like Hindus, and we cannot do like Muslims. Everything is new, so we need to create our own moral discipline guide by ourself.