Valuing Money Over Victims

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by Paul Murano  •  ChurchMilitant.com  •  January 9, 2020   

Church shielding billions in assets from sex abuse lawsuits

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DETROIT (ChurchMilitant.com) - As dioceses around the United States respond to the abuse crisis, some appear to be concerned more about shielding assets than obtaining justice for victims.

A review by Bloomberg Businessweek of court filings by lawyers for churches and victims in the past 15 years shows that U.S. Catholic dioceses have shielded more than $2 billion in assets from abuse victims.

In the wake of Bloomberg's findings, Terry McKiernan, president of BishopAccountability.org, lamented, "The survivors should have gotten that money, and they didn't. The Catholic Church has behaved like a business. It hasn't behaved like a religion that lives by the rules it espouses."

Catholic dioceses have shielded more than $2 billion in assets from abuse victims.

A few examples have been noted by critics.

The archdiocese of Detroit, Michigan has transferred hundreds of parishes to a separate real estate corporation. 

The diocese of Burlington, Vermont recently "came clean" on its history of child sex abuse claims with its latest public financial statement that lists $16 million in unrestricted net assets. This did not include, however, an estimated $500 million in property owned by the church that diocesan leaders allegedly stashed into trusts more than a decade ago to protect the assets from potential clergy abuse settlements.

The archdiocese of Santa Fe, New Mexico appears to have been preparing for years to file for bankruptcy. Archbishop John C. Wester, in a statement of stark candor about diocesan policy, stated: "We've [consulted with] a bankruptcy attorney for the last four or five years because we could see where this is all leading." 

In recent years, the archdiocese has incorporated individual parishes as separate nonprofit organizations and set up a corporation to hold some of its real estate.

How Shielding Assets Began

Before the 1980s, sexual abuse was largely swept under the rug. A culture of shame and less aggressive media enabled the institutional Church to keep such abuse cases in-house, away from the public eye. The Boston Globe story in 2002 changed all that.

Today, as the sexual abuse claims pile up, critics claim that behind the scenes many dioceses are lawyering up to shield their assets from potential lawsuits brought on by sexual abuse claimants. What might be seen by some as responsible stewardship in the midst of a litigious society, others see as unjust manipulation with sinister motives.

Behind the scenes many dioceses are lawyering up to shield their assets from potential lawsuits.

Now that rules are changing about how much time a victim has to sue over their abuse, more dioceses are protecting themselves and going the route of filing for bankruptcy.

Seven states and the District of Columbia have passed laws in 2019 that suspend the statute of limitations on civil sex abuse suits, and at least three other states are considering doing so.

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Bp. Edward Scharfenberger 

In the wake of the #MeToo movement, laws known as "window statutes" have become more popular. Until recently, only a half-dozen states had them. Window statutes led churches to declare bankruptcy in Wilmington, Delaware, San Diego, and cities throughout Minnesota. A total of 430 sex abuse victims immediately filed lawsuits after New York's state law went into effect.

There are also clerics who are publicly speaking out and seeking to do what is right and serve justice for survivors of abuse.

Bishop Edward Scharfenberger, for example, became the new apostolic administrator for the diocese of Buffalo in the wake of the resignation of Bp. Richard Malone for allegedly mishandling his diocese's sexual abuse claims. Sharfenberger has a message to the New York diocese as well as for all victims of abuse.

"Criminality cannot hide behind secrecy. So if there's any evidence in any files [that] criminal behavior occurred, I want to know about it," said Scharfenberger, emphasizing that there will be a zero-tolerance policy for criminal behavior.  

"There are no secret files. No secret files," he asserted. "But I understand why people would see that. There is a secret archive. There's no clergy files kept in the secret archive. I want to do things in a very deliberative way so that we get it right."

 

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