After lobbying, Catholic Church won $1.4B in virus aid


By REESE DUNKLIN and MICHAEL REZENDES

The U.S. Roman Catholic Church used a special and unprecedented exemption from federal rules to amass at least $1.4 billion in taxpayer-backed coronavirus aid, with many millions going to dioceses that have paid huge settlements or sought bankruptcy protection because of clergy sexual abuse cover-ups.

The church’s haul may have reached — or even exceeded — $3.5 billion, making a global religious institution with more than a billion followers among the biggest winners in the U.S. government’s pandemic relief efforts, an Associated Press analysis of federal data released this week found.

Houses of worship and faith-based organizations that promote religious beliefs aren’t usually eligible for money from the U.S. Small Business Administration. But as the economy plummeted and jobless rates soared, Congress let faith groups and other nonprofits tap into the Paycheck Protection Program, a $659 billion fund created to keep Main Street open and Americans employed.

By aggressively promoting the payroll program and marshaling resources to help affiliates navigate its shifting rules, Catholic dioceses, parishes, schools and other ministries have so far received approval for at least 3,500 forgivable loans, AP found.

The Archdiocese of New York, for example, received 15 loans worth at least $28 million just for its top executive offices. Its iconic St. Patrick’s Cathedral on Fifth Avenue was approved for at least $1 million.

In Orange County, California, where a sparkling glass cathedral estimated to cost over $70 million recently opened, diocesan officials working at the complex received four loans worth at least $3 million.

And elsewhere, a loan of at least $2 million went to the diocese covering Wheeling-Charleston, West Virginia, where a church investigation revealed last year that then-Bishop Michael Bransfield embezzled funds and made sexual advances toward young priests.

Simply being eligible for low-interest loans was a new opportunity. But the church couldn’t have been approved for so many loans — which the government will forgive if they are used for wages, rent and utilities — without a second break.

Religious groups persuaded the Trump administration to free them from a rule that typically disqualifies an applicant with more than 500 workers. Without this preferential treatment, many Catholic dioceses would have been ineligible because — between their head offices, parishes and other affiliates — their employees exceed the 500-person cap.

“The government grants special dispensation, and that creates a kind of structural favoritism,” said Micah Schwartzman, a University of Virginia law professor specializing in constitutional issues and religion who has studied the Paycheck Protection Program. “And that favoritism was worth billions of dollars.”

The amount that the church collected, between $1.4 billion and $3.5 billion, is an undercount. The Diocesan Fiscal Management Conference, an organization of Catholic financial officers, surveyed members and reported that about 9,000 Catholic entities received loans. That is nearly three times the number of Catholic recipients the AP could identify.

The AP couldn’t find more Catholic beneficiaries because the government’s data, released after pressure from Congress and a lawsuit from news outlets including the AP, didn’t name recipients of loans under $150,000 — a category in which many smaller churches would fall. And because the government released only ranges of loan amounts, it wasn’t possible to be more precise.

Even without a full accounting, AP’s analysis places the Catholic Church among the major beneficiaries in the Paycheck Protection Program, which also has helped companies backed by celebrities, billionaires, state governors and members of Congress.

The program was open to all religious groups, and many took advantage. Evangelical advisers to President Donald Trump, including his White House spiritual czar, Paula White-Cain, also received loans.

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‘TRULY IN NEED’

There is no doubt that state shelter-in-place orders disrupted houses of worship and businesses alike.

Masses were canceled, even during the Holy Week and Easter holidays, depriving parishes of expected revenue and contributing to layoffs in some dioceses. Some families of Catholic school students are struggling to make tuition payments. And the expense of disinfecting classrooms once classes resume will put additional pressure on budgets.

But other problems were self-inflicted. Long before the pandemic, scores of dioceses faced increasing financial pressure because of a dramatic rise in recent clergy sex abuse claims.

The scandals that erupted in 2018 reverberated throughout the world. Pope Francis ordered the former archbishop of Washington, Cardinal Theodore McCarrick, to a life of “prayer and penance” following allegations he abused minors and adult seminarians. And a damning grand jury report about abuse in six Pennsylvania dioceses revealed bishops had long covered for predator priests, spurring investigations in more than 20 other states.

As the church again reckoned with its longtime crisis, abuse reports tripled during the year ending June 2019 to a total of nearly 4,500 nationally. Meanwhile, dioceses and religious orders shelled out $282 million that year — up from $106 million just five years earlier. Most of that went to settlements, in addition to legal fees and support for offending clergy.

Loan recipients included about 40 dioceses that have spent hundreds of millions of dollars in the past few years paying victims through compensation funds or bankruptcy proceedings. AP’s review found that these dioceses were approved for about $200 million, though the value is likely much higher.

One was the New York Archdiocese. As a successful battle to lift the statute of limitations on the filing of child sexual abuse lawsuits gathered steam, Cardinal Timothy Dolan established a victim compensation fund in 2016. Since then, other dioceses have established similar funds, which offer victims relatively quick settlements while dissuading them from filing lawsuits.

Spokesperson Joseph Zwilling said the archdiocese simply wanted to be “treated equally and fairly under the law.” When asked about the waiver from the 500-employee cap that religious organizations received, Zwilling deferred to the U.S. Conference of Catholic Bishops.

A spokesperson for the bishops’ conference acknowledged its officials lobbied for the paycheck program, but said the organization wasn’t tracking what dioceses and Catholic agencies received.

“These loans are an essential lifeline to help faith-based organizations to stay afloat and continue serving those in need during this crisis,” spokesperson Chieko Noguchi said in a written statement. According to AP’s data analysis, the church and all its organizations reported retaining at least 407,900 jobs with the money they were awarded.

Noguchi also wrote the conference felt strongly that “the administration write and implement this emergency relief fairly for all applicants.”

Not every Catholic institution sought government loans. The Ukrainian Catholic Eparchy based in Stamford, Connecticut, told AP that even though its parishes experienced a decline in donations, none of the organizations in its five-state territory submitted applications.

Deacon Steve Wisnowski, a financial officer for the eparchy, said pastors and church managers used their rainy-day savings and that parishioners responded generously with donations. As a result, parishes “did not experience a severe financial crisis.”

Wisnowski said his superiors understood the program was for “organizations and businesses truly in need of assistance.”

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LOBBYING FOR A BREAK

The law that created the Paycheck Protection Program let nonprofits participate, as long as they abided by SBA’s “affiliation rule.” The rule typically says that only businesses with fewer than 500 employees, including at all subsidiaries, are eligible.

Lobbying by the church helped religious organizations get an exception.

The Catholic News Service reported that the bishops’ conference and several major Catholic nonprofit agencies worked throughout the week of March 30 to ensure that the “unique nature of the entities would not make them ineligible for the program” because of how SBA defines a “small” business. Those conversations came just days after President Trump signed the $2 trillion Coronavirus Aid, Relief, and Economic Security Act, which included the Paycheck Protection Program.

In addition, federal records show the Los Angeles archdiocese, whose leader heads the bishops’ conference, paid $20,000 to lobby the U.S. Senate and House on “eligibility for non-profits” under the CARES Act. The records also show that Catholic Charities USA, a social service arm of the church with member agencies in dioceses across the country, paid another $30,000 to lobby on the act and other issues.

In late April, after thousands of Catholic institutions had secured loans, several hundred Catholic leaders pressed for additional help on a call with President Trump. During the call, Trump underscored the coming presidential election and touted himself as the candidate best aligned with religious conservatives, boasting he was the “best (president) the Catholic church has ever seen,” according to Crux, an online publication that covers church-related news.

The lobbying paid off.

Catholic Charities USA and its member agencies were approved for about 110 loans worth between $90 million and $220 million at least, according to the data.

In a statement, Catholic Charities said: “Each organization is a separate legal entity under the auspices of the bishop in the diocese in which the agency is located. CCUSA supports agencies that choose to become members, but does not have any role in their daily operations or governance.”

The Los Angeles archdiocese told AP in a survey that reporters sent before the release of federal data that 247 of its 288 parishes — and all but one of its 232 schools — received loans. The survey covered more than 180 dioceses and eparchies.

Like most dioceses, Los Angeles wouldn’t disclose its total dollar amount. While the federal data doesn’t link Catholic recipients to their home dioceses, AP found 37 loans to the archdiocese and its affiliates worth between $9 million and $23 million, including one for its downtown cathedral.

In 2014, the archdiocese paid a record $660 million to settle sex abuse claims from more than 500 victims. Spokespeople for Los Angeles Archbishop Jose M. Gomez did not respond to additional questions about the archdiocese’s finances and lobbying.

In program materials, SBA officials said they provided the affiliation waiver to religious groups in deference to their unique organizational structure, and because the public health response to slow the coronavirus’ spread disrupted churches just as it did businesses.

A senior official in the U.S. Department of the Treasury, which oversees the SBA, acknowledged in a statement the wider availability of SBA loans to religious organizations. “The CARES Act expanded eligibility to include nonprofits in the PPP, and SBA’s regulations ensured that no eligible religious nonprofit was excluded from participation due to its beliefs or denomination,” the statement said.

Meanwhile, some legal experts say that the special consideration the government gave faith groups in the loan program has further eroded the wall between church and state provided in the First Amendment. With that erosion, religious groups that don’t pay taxes have gained more access to public money, said Marci Hamilton, a University of Pennsylvania professor and attorney who has represented clergy abuse victims on constitutional issues during bankruptcy proceedings.

“At this point, the argument is you’re anti-religious if in fact you would say the Catholic Church shouldn’t be getting government funding,” Hamilton said.

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CASHING IN FAST

After its lobbying blitz, the Catholic Church worked with parishes and schools to access the money.

Many dioceses — from large ones such as the Archdiocese of Boston to smaller ones such as the Diocese of La Crosse, Wisconsin — assembled how-to guides to help their affiliates apply. The national Catholic fiscal conference also hosted multiple webinars with legal and financial experts to help coach along local leaders.

Federal data show that the bulk of the church’s money was approved during the loan program’s first two weeks. That’s when demand for the first-come, first-served assistance was so high that the initial $349 billion was quickly exhausted, shutting out many local businesses.

Overall, nearly 500 loans approved to Catholic entities exceeded $1 million each. The AP found that at least eight hit the maximum range of $5 million to $10 million. Many of the listed recipients were the offices of bishops, headquarters of leading religious orders, major churches, schools and chapters of Catholic Charities.

Also among recipients was the Saint Luke Institute. The Catholic treatment center for priests accused of sexual abuse and those suffering from other disorders received a loan ranging from $350,000 to $1 million. Based in Silver Spring, Maryland, the institute has at times been a way station for priests accused of sexual abuse who returned to active ministry only to abuse again.

Perhaps nothing illustrates the church’s aggressive pursuit of funds better than four dioceses that sued the federal government to receive loans, even though they entered bankruptcy proceedings due to mounting clergy sex-abuse claims. Small Business Administration rules prohibit loans to applicants in bankruptcy.

The Archdiocese of Santa Fe, New Mexico — once home to a now-closed and notorious treatment center for predator priests — prevailed in court, clearing the way for its administrative offices to receive nearly $1 million. It accused the SBA of overreaching by blocking bankruptcy applications when Congress didn’t spell that out.

Yet even when a diocese has lost in bankruptcy court, or its case is pending, its affiliated parishes, schools and other organizations remain eligible for loans.

On the U.S. territory of Guam, well over 200 clergy abuse lawsuits led church leaders in the tiny Archdiocese of Agana to seek bankruptcy protection, as they estimated at least $45 million in liabilities. Even so, the archdiocese’s parishes, schools and other organizations have received at least $1.7 million as it sues the SBA for approval to get a loan for its headquarters, according to bankruptcy filings.

The U.S. church may have a troubling record on sex abuse, but Bishop Lawrence Persico of Erie, Pennsylvania, pushed back on the idea that dioceses should be excluded from the government’s rescue package. Approximately 80 organizations within his diocese received loans worth $10.3 million, the diocese said, with most of the money going to parishes and schools.

Persico pointed out that church entities help feed, clothe and shelter the poor — and in doing so keep people employed.

“I know some people may react with surprise that government funding helped support faith-based schools, parishes and dioceses,” he said. “The separation of church and state does not mean that those motivated by their faith have no place in the public square.”

NFL’s Saints seek to shield PR help to church in sex crisis

In this Oct. 23, 2016, file photo, a New Orleans Saints helmet rests on the playing field before an NFL football game in Kansas City, Mo. The Saints are going to court to keep the public from seeing hundreds of emails that allegedly show team executives doing public relations damage control for the area’s Roman Catholic archdiocese to help it contain the fallout from a burgeoning sexual abuse crisis.

By JIM MUSTIAN

The New Orleans Saints are going to court to keep the public from seeing hundreds of emails that allegedly show team executives doing public relations damage control for the area’s Roman Catholic archdiocese to help it contain the fallout from a burgeoning sexual abuse crisis.

Attorneys for about two dozen men suing the church say in court filings that the 276 documents they obtained through discovery show that the NFL team, whose owner is devoutly Catholic, aided the Archdiocese of New Orleans in its “pattern and practice of concealing its crimes.”

“Obviously, the Saints should not be in the business of assisting the Archdiocese, and the Saints’ public relations team is not in the business of managing the public relations of criminals engaged in pedophilia,” the attorneys wrote in a court filing. “The Saints realize that if the documents at issue are made public, this professional sports organization also will be smearing itself.”

The Saints organization and its attorneys emphatically disputed any suggestion that the team helped the church cover up crimes. In a statement Friday, the Saints said the archdiocese sought its advice on how to handle media attention that would come from its 2018 release of its list of more than 50 clergy members “credibly accused” of sexual abuse.

“The advice was simple and never wavering. Be direct, open and fully transparent, while making sure that all law enforcement agencies were alerted,” the team said.

The team added that it has “no interest in concealing information from the press or public” and that it “merely requested the court to apply the normal rules of civil discovery.” However, attorneys for the Saints argued in court papers this month that the 2018-19 emails were intended to be private and should not be “fodder for the public.”

The archdiocese is also fighting the release of the emails.

The National Football League, which was advised of the matter by plaintiffs’ attorneys because the Saints’ emails used the team’s nfl.com domain, has not commented on the case. NFL policy says everyone who is a part of the league must refrain from “conduct detrimental to the integrity of and public confidence in” the NFL.
For more AP coverage of the clergy abuse crisis: The Reckoning

A court-appointed special master is expected to hear arguments in the coming weeks on whether the communications should remain confidential.

The Associated Press, which has extensively covered clergy sexual abuse in a series of stories over the past year, filed a motion with the court supporting the release of the documents as a matter of public interest.

“This case does not involve intensely private individuals who are dragged into the spotlight,” the AP argued, “but well-known mega-institutions that collect millions of dollars from local residents to support their activities.”

Ties between local church leaders and the Saints include a close friendship between New Orleans Archbishop Gregory Aymond and Gayle Benson, who inherited the Saints and the New Orleans Pelicans basketball team when her husband, Tom Benson, died in 2018. The archbishop was at Gayle Benson’s side as she walked in the funeral procession.

Gayle Benson has given millions of dollars to Catholic institutions in the New Orleans area, and the archbishop is a regular guest of hers at games and charitable events for the church.

Attorneys for the men suing the church say “multiple” Saints personnel, including Senior Vice President of Communications Greg Bensel, used their team email to advise church officials on “messaging” and how to soften the impact of the archdiocese’s release of the list of credibly accused clergy.

“The information at issue bears a relationship to these crimes because it is a continuation of the Archdiocese’s pattern and practice of concealing its crimes so that the public does not discover its criminal behavior,” the plaintiffs’ attorneys wrote. “And the Saints joined in.”

In this March 21, 2018, file photo, Gayle Benson, widow of NFL New Orleans Saints and NBA New Orleans Pelicans owner Tom Benson, walks down the steps to receive his casket with New Orleans Archbishop Gregory Aymond

Attorneys for the Saints acknowledged in a court filing that the team assisted the archdiocese in its publishing of the list but said that was an act of disclosure — “the opposite of concealment.”

In its statement, the team its executives and ownership “remain offended, disappointed and repulsed by the actions of certain past clergy. We remain steadfast in support of the victims who have suffered and pray for their continued healing.”

A handful of Saints emails that emerged last year in the clergy abuse litigation included an October 2018 exchange in which Bensel asked an archdiocese spokeswoman whether there might be “a benefit to saying we support a victims right to pursue a remedy through the courts.”

“I don’t think we want to say we ‘support’ victims going to the courts,” Sarah McDonald, the archdiocese’s communications director, replied, “but we certainly encourage them to come forward.”

The fight over the emails is part of a flurry of claims filed against the archdiocese over its employment of George F. Brignac, a longtime schoolteacher and deacon who was removed from the ministry in 1988 after a 7-year-old boy accused him of fondling him at a Christmas party. That accusation followed claims that Briganc abused several other boys, including one case that led to his acquittal in 1978 on three counts of indecent behavior with a juvenile.

Church officials permitted Brignac, 85, to act as a lay minister until local news accounts of his service in 2018 prompted his ouster and an apology from the archdiocese. The AP last year reported that Brignac, despite his supposed defrocking, also maintained access to schoolchildren and held leadership roles as recently as 2018 in the Knights of Columbus.

Following a new wave of publicity — in which Brignac told a reporter he had touched boys but never for “immoral purposes” — Brignac was indicted last month on a rape charge that could land him behind bars for the rest of his life. The prosecution came more than a year after a former altar boy told police that Brignac repeatedly raped him beginning in the late 1970s. Police said the abuse began when the boy was 7 and continued until he was 11.

The archdiocese, meanwhile, has settled several lawsuits against Brignac and included the former deacon on its credibly accused list.

A lawyer for the archdiocese, E. Dirk Wegmann, said earlier this month that the plaintiffs’ attorneys seeking the release of the emails are engaged in a “proverbial witch hunt with respect to decades-old abuse” and want to give the messages to the media to “unfairly try to tar and feather the archdiocese.”

Complete Article HERE!

Disgraced former cardinal McCarrick gave more than $600,000 in church funds to powerful clerics, records show

Cardinal Theodore McCarrick, now defrocked, prepares to celebrate Mass at the Basilica of Sts. Nereus and Achilleus in Rome in 2005.

By Shawn Boburg, Robert O’Harrow Jr. and Chico Harlan

Former cardinal Theodore McCarrick gave hundreds of thousands of dollars in church money to powerful Catholic clerics over nearly two decades, according to financial records obtained by The Washington Post, while the Vatican failed to act on claims he had sexually harassed young men.

Starting in 2001, McCarrick sent checks totaling more than $600,000 to clerics in Rome and elsewhere, including Vatican bureaucrats, papal advisers and two popes, according to church ledgers and former church officials.

Several of the more than 100 recipients were directly involved in assessing misconduct claims against McCarrick, documents and interviews show. It was not until 2018 that McCarrick was removed from public ministry amid allegations of misconduct decades earlier with a 16-year-old altar boy, and this year he became the first cardinal known to be defrocked for sexual abuse.

The checks were drawn from a little-known account at the Archdiocese of Washington, where McCarrick began serving as archbishop in 2001. The “Archbishop’s Special Fund” enabled him to raise money from wealthy Catholic donors and to spend it as he chose, with little oversight, according to the former officials.

McCarrick sent Pope John Paul II $90,000 from 2001 to 2005. Pope Benedict XVI received $291,000, most of it a single check for $250,000 in May 2005, a month after he was elevated to succeed the late John Paul.

Representatives of the former popes declined to comment or said they had no information about those specific checks. A former personal secretary to John Paul said donations to the pope were forwarded to the secretary of state, the second most powerful post at the Vatican. Experts cautioned that such gifts may also have been directed to papal charities.

A Vatican spokesman declined to comment. In statements, Vatican clerics who received checks described them as customary gifts among Catholic leaders during the Christmas season or as a gesture of appreciation for their service. They said the gifts from McCarrick were directed to charity or used for other proper purposes.

The gifts “never had any effect on the Cardinal’s decision-making as an official of the Holy See,” said a spokesman for Cardinal Leonardo Sandri, a high-ranking cleric who received $6,500 from McCarrick in the 2000s, the ledgers show.

The checks from McCarrick’s fund add a new dimension to a scandal over how he rose to the highest levels of the U.S. Catholic Church and remained there despite complaints of misconduct that reached the Vatican as early as 2000. A Post investigation earlier this year found that another cleric, a McCarrick ally who was a bishop in West Virginia, also gave cash gifts to influential clergy in the United States and at the Vatican while facing allegations of sexual misconduct and financial abuses.

McCarrick, a legendary fundraiser for the church, was defrocked in February after Vatican officials found him guilty of two charges: soliciting sex during confession and committing “sins” with minors and adults “with the aggravating factor of the abuse of power.”

St. Peter’s Basilica in Vatican City. The Vatican plans to release its report on McCarrick soon.

The Vatican plans to release a report about its handling of the allegations against McCarrick in the coming months, church officials have said. The financial records from the Archbishop’s Special Fund are among the documents church officials in Washington sent to Rome for that examination, according to one former archdiocese official. The former officials spoke on the condition of anonymity because they were not authorized to discuss the matter.

An attorney for McCarrick did not respond to requests for comment for this story. In his only public statements about the misconduct allegations, McCarrick recently told a reporter, “I do not believe that I did the things that they accuse me of.”

In a statement to The Post, the Archdiocese of Washington said McCarrick had sole control of the tax-exempt fund.

“The funds in the account came from donations sent personally to Mr. McCarrick to direct in his sole discretion,” the archdiocese said. “During his tenure in Washington, Mr. McCarrick made contributions to many charitable and religious organizations and members of leadership in the Church.”

The ledgers obtained by The Post show names of beneficiaries, check numbers, amounts and dates of disbursement. The ledgers also contain the names of donors for the years 2010 to 2016.

McCarrick’s fund took in more than $6 million over 17 years. Among the biggest contributors was Maryanne Trump Barry, the sister of President Trump and a former federal appellate judge. She gave him at least $450,000 over four years, the records show. She declined to comment.

McCarrick directed millions of dollars from the fund to Catholic charities in the United States and in Rome, as well as organizations in countries stricken by poverty and conflict, the ledgers show.

Yet nearly 200 checks were sent to fellow clerics, including more than 60 archbishops and cardinals.

The leader of a foundation that made substantial contributions to McCarrick’s fund said he was surprised to learn that checks went to clerics. Tom Riley, president of the Connelly Foundation, based outside Philadelphia, said in a statement that his group’s contributions were meant to help “the poor, the needy, refugees, and the mission of the Catholic Church.”

“Everything about the current situation is a source of terrible sadness for us,” he said.

Checks to key figures

McCarrick, 89, became one of the most recognizable church figures in America during a career spanning a half-century. He traveled the world for the Vatican and became the U.S. Catholic Church’s de facto spokesman nearly two decades ago as it reeled from a sex-abuse crisis that began in Boston. In Washington, he presided over funerals of the city’s political elite, including Edward M. Kennedy, the Democratic senator from Massachusetts, and hosted dinners for President George W. Bush and other dignitaries.

Behind the scenes, McCarrick’s alleged conduct so alarmed some of his fellow clerics that they reported it to superiors, according to documents that have been posted online in recent years and interviews with some of those involved.

One of those who came forward was the Rev. Boniface Ramsey, a teacher in the late 1980s and early 1990s at the Immaculate Conception Seminary in the Archdiocese of Newark. McCarrick was leader of the archdiocese for more than a decade.

Ramsey said publicly last year that he called the Vatican’s U.S. diplomat, known as the apostolic nuncio, in 2000 to sound the alarm when McCarrick was announced as the next archbishop in Washington.

“I was just shocked,” Ramsey said in a recent interview with The Post.

Ramsey said he told the apostolic nuncio, Archbishop Gabriel Montalvo, that McCarrick routinely took students from the seminary to his New Jersey beach house and pressured them to sleep with him in his bed. Ramsey told Montalvo he was not aware of any sexual contact but considered McCarrick’s behavior inappropriate.

Montalvo instructed Ramsey to put his claims in writing so they could be forwarded to the Vatican, and Ramsey did so, he said. Ramsey heard nothing back until 2006, when he received a letter from Sandri, then an archbishop in the Vatican secretary of state’s office. The letter briefly acknowledged his warning from several years earlier, according to a copy he posted online.

The ledgers obtained by The Post show that McCarrick was writing checks in those years to Montalvo, Sandri and other senior prelates responsible for managing clerics or handling sex-abuse allegations.

Montalvo accepted three checks from McCarrick worth a total of $5,000 before his death in 2006, the ledgers show, while Sandri received the $6,500 from 2002 to 2008.

Cardinal Angelo Sodano, who until 2006 served as secretary of state, received $19,000 from 2002 to 2016, the records show.

Sodano did not respond to messages seeking comment.

The Rev. J. Augustine Di Noia, an American who in 2001 started working in the Vatican office that assessed sex-abuse claims, accepted six checks worth a total of $9,500 from 2001 to 2009, the records show.

In a statement, a spokesman for Di Noia, now an archbishop, said the first check was for expenses related to his move to the Vatican. Others were “Christmas-time offerings” or were given to support him as he transferred to another Vatican post in 2009.

“Archbishop Di Noia affirms categorically that Theodore McCarrick never attempted to influence him in his work for the Holy See,” he said. “Whatever were Theodore McCarrick’s tragic personal failures, it is nevertheless a sad day when improper motives are reflexively assigned to assistance given and received in good faith.”

Told by The Post of McCarrick’s checks, Ramsey said he was not surprised.

“I assumed something like this was going on,” he said. “But I didn’t know checks were going to individual clerics.”

Lack of action

A retired bishop of the Diocese of Metuchen, N.J., said in a statement last year that in December 2005 he contacted Montalvo with new allegations about McCarrick. Bishop Emeritus Paul Bootkoski said he called the apostolic nuncio and then followed up in writing to relay two former seminarians’ claims of sexual misconduct by McCarrick.

Officials in the Metuchen Diocese deemed one claim so significant that they had already secretly paid an $80,000 settlement, according to recent news accounts. They would pay $100,000 to the second seminarian a short time later.

While leaders in Rome considered how to proceed, McCarrick reached retirement age. In May 2006, he stepped down from his post in Washington, his public reputation untarnished. He remained prominent in church affairs and in his capacity as archbishop emeritus was allowed to maintain control of the special fund.

At least one Vatican official has said he was infuriated by the lack of action against McCarrick. Late in 2006, Archbishop Carlo Maria Viganò wrote a memo urging Sandri and Cardinal Tarcisio Bertone, then the secretary of state, to sanction McCarrick, according to a public letter Viganò released through Catholic publications in 2018.

Viganò wrote that his superiors never responded to the memo he sent in 2006. He accused Vatican officials of protecting McCarrick and asserted that McCarrick “had the financial means to influence decisions” at the time. He did not elaborate in the letter and did not respond to a message seeking comment.

Viganò’s August 2018 letter was published soon after the church announced that McCarrick was being removed from public ministry.

Critics of Viganò have accused him of using the letter to undermine progressive adversaries within the church. In public statements, some top Vatican officials have disputed details of Viganò’s account, including his claim that Pope Francis was aware of detailed allegations against McCarrick years ago but ignored them. Francis does not appear among the list of check recipients, according to the ledgers obtained by The Post.

At the same time Viganò says he was urging sanctions, McCarrick continued sending checks to key church figures. The checks were often clustered around Christmas, with just over half recorded in the ledgers in December or January, according to a Post analysis. In some cases, McCarrick started giving clerics money when they took on new jobs with more authority.

In 2007, among the new beneficiaries was Bertone, who had recently been named secretary of state. Records show that Bertone received seven checks worth a total of $7,000 before he stepped down in 2013.

Cardinal Fernando Filoni began receiving checks in 2008, soon after he was elevated to be a top aide to Bertone. Filoni received $3,500 through 2013, the records show.

Viganò said in his public letter that he shared his concerns about McCarrick with Filoni in 2008. Once again, nothing came of it, Viganò said.

“I was greatly dismayed at my superiors for the inconceivable absence of any measure against the Cardinal,” Viganò wrote.

Bertone and Filoni did not respond to messages seeking comment.

McCarrick also gave to lower-level officials in Rome.

American Archbishop Peter Wells started receiving checks in 2010, the year after he took a key Vatican job under Filoni. Wells had received $2,500 by the time the checks stopped in 2016, the year he left the post for an assignment outside the Vatican.

Other recipients included the longtime head of the papal household, Cardinal James Harvey, and at least two priests working as personal assistants to Benedict and John Paul.

Wells did not respond to messages seeking comment.

In an interview, Harvey said numerous bishops from big cities in the United States sent him monetary gifts to show appreciation for his office’s help, including in making arrangements for visits to the pope.

“It never occurred to me that this would be in some way improper,” he said.

“It wasn’t about currying favor,” Harvey said. “It wasn’t some parallel system of nefarious activity.”

A spokesman for Cardinal Pietro Parolin, the Vatican’s secretary of state, called such gifts common and said they do not influence how Parolin exercises his official responsibilities. He received $1,000 from McCarrick shortly after becoming secretary of state in 2013.

“To send and receive such gifts is customary during the Christmas season, including between Bishops, as a sign of appreciation for work carried out in the service of the universal Church and for the Holy Father,” the spokesman said in a statement.

Some experts, told of The Post’s findings, said cash gifts can create the appearance of a conflict.

“It raises questions about whether McCarrick was buying access or protection,” said the Rev. Thomas Reese, a columnist at Religion News Service and author of a book about Vatican politics and operations. “This doesn’t pass the smell test.”

Former West Virginia bishop Michael J. Bransfield gave $350,000 in cash gifts to clerics in the United States and at the Vatican from 2005 to 2018, The Post reported in June. He used church money that was routed through his personal account.

The church began investigating Bransfield last year after one of his top aides wrote in a confidential letter to church leaders that the gifts, many of them sent around the Christmas season, were an attempt to “purchase influence.” The investigation later faulted Bransfield for the gifts and found that he inappropriately spent millions of dollars in church money on personal extravagances and engaged in sexual misconduct with seminarians and young priests. Bransfield, who was removed from public ministry in July, has denied wrongdoing.

More than a dozen recipients of Bransfield’s gifts pledged to return the money after The Post reported that it was drawn from church accounts.

At least 17 clerics who received cash gifts from Bransfield also received checks from McCarrick, records show.

Well-known donors

The donors to the Archbishop’s Special Fund include wealthy and well-known figures.

Among them are novelist Mary Higgins Clark; John B. Hess, chief executive of oil giant Hess Corp.; and a foundation run by Rep. Francis Rooney (R-Fla.), who previously served as U.S. ambassador to the Vatican, the ledgers show.

“For many years I have supported a long list of Catholic charities and causes because I believe in the work they do,” Clark said in a statement. “If the money I donated to Cardinal McCarrick was misused in any way, it was without my knowledge, and I am shocked and saddened.”

Hess and Rooney did not respond to requests for comment.

Another donor was William McIntosh, a former Wall Street executive. McIntosh said he got to know McCarrick in the 1990s when both served on the board of the Papal Foundation, a Philadelphia-based charity that has raised hundreds of millions of dollars for initiatives favored by the pope. McCarrick was a founder of the charity and its first president.

McIntosh said he began sending contributions to McCarrick when he was archbishop in Newark for a discretionary charitable account he controlled at the time. McIntosh said he trusted McCar­rick’s judgment and was unaware that money he sent him over the years went to other clerics.

“Based on my work with him at the Papal Foundation, I considered him excellent at what he did and tried to be helpful,” McIntosh said. “I had no idea what he was doing with it. I assumed he was doing good things.”

A spokeswoman for the Archdiocese of Newark, Maria Margiotta, declined to answer questions about the fund McCarrick controlled there. “Since matters involving former Cardinal McCar­rick are under review by law enforcement and/or involve litigation, it would be inappropriate for us to discuss publicly,” she said.

The current archbishop of Newark, Joseph W. Tobin, received a $1,000 check from McCarrick in 2016, the ledgers show. Margiotta said that the check was a gift marking Tobin’s elevation as a cardinal and that he believes he deposited it “in a personal account, where it was used to defray the expenses incurred by his new responsibilities or for charitable purposes.”

Some of the money that flowed into McCarrick’s fund came from a foundation that he advised as a board member.

McCarrick directed at least $250,000 to his fund from the Loyola Foundation between 2011 and 2016, as he sat on the foundation’s board, said Executive Director Gregory McCarthy. Each foundation board member was allowed to designate an annual allotment to a favored charity, McCarthy said.

“In this case, the funds went to the Archbishop’s Fund, which was overseen by the Archdiocese of Washington,” McCarthy said. “Frankly I did not know where the funds would go from there.”

McCarthy said foundation officials received assurances from the Archdiocese of Washington that McCarrick’s account was a legitimate charitable fund.

According to two former archdiocese officials, the fund was reviewed yearly to account for expenditures and deposits but otherwise received minimal oversight.

Meanwhile, the number of people claiming to have been abused by McCarrick continues to expand. Early this year, U.S. church officials sent the Vatican allegations involving at least seven boys and dating from 1970 to 1990, The Post has reported.

Amid the fallout, the Catholic Church has been under pressure to explain how it ignored or missed years of warnings. The Vatican report addressing those issues is expected to be released as early as January. In announcing the review in 2018, the Vatican said in a statement that “both abuse and its cover-up can no longer be tolerated.”

Complete Article HERE!

How Vermont’s Catholic Church stashed away a half-billion dollars in assets

The Cathedral of St. Joseph in Burlington. Seen on Friday, November 15, 2019.

By

When Vermont’s Catholic Church recently came clean about its half-century-long history of child sex abuse claims against 10% of its clergy, many wondered how much money the state’s largest religious denomination had on hand to deal with a potential new wave of lawsuits.

The statewide Diocese of Burlington’s latest public financial statement lists $16 million in unrestricted net assets.

But that figure doesn’t include an estimated $500 million in property that church leaders stashed into trusts more than a decade ago to protect those assets from priest abuse settlements.

In the spring of 2006, then-Bishop Salvatore Matano began to see how much the scandal, first exposed by the Boston Globe, would cost the church.

The Vermont diocese had paid one accuser $20,000 to drop his court case in 2003. A year later, two more men demanded $120,000 and $150,000 respectively before they agreed to settle. In 2006, the church, facing a six-figure debt and a seemingly endless series of civil lawsuits, saw individual settlement claims rise to nearly $1 million.

That’s when Matano hatched an idea. The bishop told his attorney to place each of the diocese’s local parishes — some 130 at the time — into separate trusts whose holdings could only be tapped for “pious, charitable or educational purposes,” shielding the property from potential multimillion-dollar jury verdicts.

“In such litigious times, it would be a gross act of mismanagement if I did not do everything possible to protect our parishes and the interests of the faithful from unbridled, unjust and terribly unreasonable assault,” Matano wrote in a private letter to concerned Catholics.

Soon after, the diocese’s lawyer quietly sent a stack of two-page “deed into trust” form letters to municipal clerks throughout the state.

Although news reports revealed the diocese’s initial idea for shielding assets 13 years ago, details about how the church carried out the plan, what it stockpiled and where everything would lead haven’t been reported until now. As renewed scrutiny of priest misconduct raises new questions about the diocese’s capacity for future payouts, the trusts could soon be tested.

‘The information we have is sufficiently compelling’

Ever since 17th century Catholic explorer Samuel de Champlain inspired the name of the Green Mountain State — “Voilà les monts verts!” he reportedly exclaimed four centuries ago — the church has played a prominent role in Vermont history, boasting as many as 157,000 members as late as 1980.

But its reputation was besmirched when former residents of Burlington’s now-closed St. Joseph’s Catholic orphanage spoke publicly in the 1990s about enduring physical and psychological abuse during the facility’s operation from 1854 to 1974.

The diocese offered each orphanage resident $5,000 to drop their right to sue. As many as 160 considered the deal and more than 100 accepted payment, according to news reports from the time.

When the press reported on a statewide priest misconduct scandal in the early 2000s, church leaders used a similar strategy to keep survivors from talking.

The idea initially worked. In the fall of 2003, the diocese settled the first lawsuit for a small unspecified sum.

“I’m not going to tell you the amount, although it’s relatively low,” the accuser’s lawyer said at the time of a figure reported to be $20,000. “It was never about the money, it was getting the church to recognize what they did was wrong. We don’t think this is the end of the story. We think there are other victims out there.”

Other survivors weren’t as easily satisfied. A year later, the diocese settled two more cases for $120,000 and $150,000. The church also revealed it had spent more than $700,000 to squash earlier lawsuits dating back to 1950 and another $2 million for orphanage-related compensation, counseling and legal fees.

The diocese doesn’t have insurance for abuse cases and therefore must pay for settlements with assets on hand. (Church leaders stress they don’t tap regular collection money or the diocesan Bishop’s Fund for settlements.)

By 2005, more than a dozen people had filed lawsuits seeking liens on church property totaling up to $30 million.

“We believe the information we have is sufficiently compelling that seven-figure verdicts are quite likely,” their lawyer, Jerome O’Neill of Burlington, said at the time about the possibility of jury trials. “We want to make sure that there are sufficient assets available if we are successful in our actions.”

Former Vermont Catholic Bishop Salvatore Matano speaks in Chittenden Superior Court in 2008.

‘This was much more than we wanted to pay’

Soon after, O’Neill scored big when a judge ordered the Vermont Attorney General’s office to share the priest misconduct files it obtained from the diocese. The lawyer received hundreds of pages of paperwork chronicling the fact the church knew several of its priests had faced accusations of child sex abuse for decades but did nothing to alert the public or police.

By the spring of 2006, O’Neill had 17 new clients and a slate of trials set to start the day after Easter. What the public didn’t know: the first of those cases centered on claims against the former Rev. Edward Paquette, who secret files showed to be the worst serial predator of all the state’s clergy.

A court order restricted anyone involved from talking publicly. But privately, O’Neill and church leaders understood the value of the papers the lawyer held in his hands. If they were introduced in court, a shocked jury might award a survivor a multimillion-dollar verdict.

The church seemed ready to reject escalating settlement demands as Burlington’s Chittenden Superior Court screened jurors for the first Paquette trial in April 2006. Then the judge, gaveling in proceedings, announced the parties had forged a last-minute agreement for a record $965,000.

“This was much more than we wanted to pay,” the diocese’s lawyer said outside court. “But we decided that it would be the best to minimize the cost.”

Church leaders had hoped the settlement would keep the accuser from talking publicly. But once the court lifted its gag order upon the close of the trial, O’Neill — whose client hadn’t signed a nondisclosure agreement — surprised everyone by revealing all of the evidence.

The documents showed Vermont Catholic leaders knew two other states had dismissed Paquette for child sex abuse before they assigned him to Rutland in 1972, Montpelier in 1974 and Burlington in 1976.

“The dossier is large and the history long,” the bishop of Fort Wayne-South Bend, Indiana, had warned his Green Mountain State colleagues in a letter about the priest’s record of molesting boys.

For the first time, the public had a glimpse of what the diocese had covered up for decades.

‘Unbridled, unjust and terribly unreasonable assault’

By the first week of May 2006, the church, suddenly in debt more than $1 million and facing a rising number of lawsuits, was studying its financial options. It soon made headlines by announcing it wanted the judge who oversaw the $965,000 settlement to be barred from presiding over the remaining cases.

“The diocese has great concern over the lack of a level playing field,” its lawyer said at the time. “We’re not trying to hide anything. We’re trying to keep prejudice from building.”

Unbeknown to the public, another church attorney was mailing two-page form letters to municipal clerks to secure parish property into individual local trusts.

“This deed into trust shall operate as an assignment of all personal property, tangible and intangible, fixed or moveable, together with all accounts, funds, benefices and entitlements, related to the ownership, operation, management, control, preservation and use of the herein conveyed real estate,” each document says.

As outlined in the papers now on file in town clerk’s offices, the diocese’s bishop is the “trustee” of each trust, each parish pastor is the “trust administrator” and each parish finance council forms the “trust advisors.”

“Thus, the present diocesan protocols and regulations for the administration of parishes remain, in effect, unchanged,” Matano wrote in his private letter to concerned Catholics.

Speaking at a 2006 Mother’s Day reception at the Woodstock Inn, Matano told attendees the trusts were “an extra layer of protection” from anyone seeking to tap church assets.

“I’m really in a no-win situation,” he said. “I want to be sensitive to victims, but I don’t want to inflict pain on innocent parishioners. It’s certainly just to ask the church to be accountable, but is it just to destroy parishes, schools and other agencies of care to do so?”

Learning about Matano’s statement about protecting the church from “unbridled, unjust and terribly unreasonable assault,” the national Survivors Network of those Abused by Priest blasted the bishop for “attacking deeply wounded men and women who were raped as kids by priests.”

“How can you lash out at them and call their long overdue, David vs. Goliath effort an ‘unbridled, unjust and terribly unreasonable assault?’” survivors wrote in a letter to Matano.

‘It has a very serious impact on a small, rural diocese’

O’Neill responded more strategically. The lawyer, knowing the church doesn’t pay taxes and its properties aren’t listed at fair market value, sought assessments of the holdings’ true financial worth.

Former state economist Arthur Woolf reviewed insurance and municipal records to place a “market value” of all Vermont Catholic Church-related property at between $270 million and $500 million.

An insurance company, for its part, estimated the replacement cost of all parish, school and support buildings at $400 million, noting the number didn’t put a price tag on the underlying land.

Matano, who steadfastly confined his media comments to diocesan-run press outlets, defended the trust idea in a rare 2006 interview. Noting “this is not in any way intended to penalize victims,” the bishop said the plan was designed to reassure Vermont churchgoers who feared the potential loss of their parish holdings.

“They had no part in these awful events of the past,” he said. “I think it’s unfair to penalize them and say they are responsible.”

St. Stephen Catholic Church in Winooski. Seen on Friday, November 15, 2019.

Matano wasn’t the only Catholic official aiming to shield assets. U.S. Cardinal Timothy Dolan, for example, was head of the Archdiocese of Milwaukee, Wisconsin, in 2007 when he worked to move nearly $57 million in church holdings into a cemetery trust to protect them “from any legal claim and liability,” he wrote in a letter to the Vatican.

O’Neill believes the act of shifting assets into trusts broke Vermont’s fraudulent deeds law, which bars any transfer “with intent to avoid a right, debt or duty.” He filed state and federal cases in 2009, charging the diocese not only shielded parish property but also $3.8 million into a pension fund and another $3.7 million into a Vermont Catholic Charities account.

“You can’t take property you have, transfer it and then say it’s beyond the reach of your creditors,” the lawyer explains today.

Headlines about the trust plans soon gave way to news of more lawsuits, more settlements and a string of trials. Juries went on to slam the church with a record $8.7 million verdict in May 2008, a nearly $3.6 million verdict in December 2008 and a $2.2 million verdict in October 2009.

“It’s a very, very large amount of money,” Matano told reporters at the time. “It has a very serious impact on a small, rural diocese.”

To ensure the church paid, a judge placed liens not only on the 32-acre Burlington headquarters and the site of the former St. Joseph’s Orphanage but also a portion of its investment portfolio. By the start of 2010, a second judge overseeing more than two dozen additional lawsuits proposed merging the cases into an unprecedented joint trial.

The diocese, fearing bankruptcy, announced it wanted to settle rather than try to defend against the cases.

With most of its assets in the trusts, the church raised $10 million by selling its Old North End offices and campus — the largest open tract of land on the Lake Champlain waterfront in the state’s most populous city — to the alternative liberal arts Burlington College in 2010.

“This will be truly transformative for the college,” the school’s head, Jane O’Meara Sanders, said at the time.

That was not to be. Instead, the financial burden of the purchase led to the closing of Burlington College in 2016 and caught Sanders in a federal investigation as her husband, U.S. Sen. Bernie Sanders, launched his first White House bid. A Justice Department review reportedly concluded last year without charges. But the resulting headlines — “Wife’s Failure to Save College Is Still Looming Over Sanders,” the New York Times reported on its front page this past summer — continue to reverberate through a second campaign cycle.

The former diocese headquarters is now the site of a 700-unit housing and business complex.

‘Who’s controlling the puppet strings?’

The diocese hoped it was finished with lawsuits, only to find itself again under scrutiny when 2018 BuzzFeed published an article titled “We Saw Nuns Kill Children: The Ghosts of St. Joseph’s Catholic Orphanage.” The story led church and law enforcement leaders to launch separate misconduct investigations and the state Legislature to remove a statute of limitation restriction for survivors to file civil cases.

O’Neill has five new lawsuits pending.

“We’ll see if we can resolve them,” he says today. “If not, we go forward with litigation.”

The former St. Joseph’s Catholic Orphanage in Burlington where the Roman Catholic Diocese of Burlington used to be headquartered. Seen on Thursday, November 14, 2019.

Matano’s successor, Vermont Catholic Bishop Christopher Coyne, isn’t looking for a fight. Calling for the church to be “fully honest about these sins of our past,” Coyne has released accusers from past nondisclosure agreements and worked with a local and state task force of police and prosecutors now investigating the history of church-wide misconduct.

“I think Bishop Coyne is trying to deal with the legacy problem of abuse,” O’Neill says. “I perceive him as someone who wants to be fair. But whether the amount of money the diocese has is adequate to resolve the cases remains to be seen.”

The diocese didn’t respond to calls for comment other than to report Coyne was away this past week at the U.S. Conference of Catholic Bishops annual general assembly in Baltimore, Maryland. He’s returning home to a church that’s financially stable. But that could change if the latest lawsuits go to trial.

Settling what he thought were the last of the abuse cases long ago, O’Neill dropped his fraudulent deeds fight and allowed the six-year statute of limitations for contesting the issue to pass. But if a future jury awards a big payoff to one of his clients, the lawyer believes a judge could rule the parish trusts to be diocesan assets and therefore available for tapping.

“The fact the bishop is the trustee makes the trusts more vulnerable to attack,” he says. “You’d have to have a judgment before it became a real issue, but if the diocese is unable to pay, we will have no hesitancy to reach for those assets. The church may have transferred them, but who’s controlling the puppet strings?”

Not Matano. He left Vermont in 2013 to become bishop of the larger Diocese of Rochester, N.Y. — which recently became the 20th nationwide to seek bankruptcy protection from creditors impacted by church’s misconduct scandal.

Complete Article HERE!

From West Virginia to the Vatican:

How a Catholic bishop secretly sent money from a church hospital to a cardinal in Rome

West Virginia Bishop Michael J. Bransfield, shown in 2016, stepped down in September 2018 amid allegations he misused church money and sexually harassed seminarians and young priests, claims that he has denied. He has since been stripped of his clerical authority and ordered to leave his West Virginia diocese.

By Robert O’Harrow Jr. and Shawn Boburg

The idea came to West Virginia Bishop Michael J. Bransfield while he was in Rome visiting an old friend, a powerful cardinal at the Vatican. Bransfield thought the cleric’s apartment was barren and lacked a comfortable room for watching television.

After Bransfield returned to West Virginia, in May 2017, he sent the cardinal a $14,000 check. “I fixed that room up for him,” Bransfield said in an interview with The Washington Post.

The gift, one of two Bransfield sent to Cardinal Kevin Farrell, was an extraordinary gesture from a religious leader in a state plagued by poverty. Even more unusual was how Bransfield obtained the cash he gave away.

The untold story behind those gifts illustrates how $21 million was moved from a church-owned hospital in Wheeling, W.Va., to be used at Bransfield’s discretion. It adds a new dimension to a financial scandal that has rippled through the Catholic Church since Bransfield’s ouster last year.

A Post investigation found that the money Bransfield sent to Farrell was routed from Wheeling Hospital to the Bishop’s Fund, a charity created by Bransfield with the stated purpose of helping the residents of West Virginia, tax filings show.

As Bransfield prepared to write the first of his personal checks to Farrell, a church official arranged to transfer money from the Bishop’s Fund into a diocese bank account — and then from there to Bransfield’s personal bank account, an internal email obtained by The Post shows.

“Bishop Bransfield made very specific requests,” said Bryan Minor, a Bishop’s Fund board member and diocese employee who wrote the email and arranged the transfers for the gifts to Farrell. “He wanted to have a discretionary fund.”

Bransfield used Bishop’s Fund money for a variety of purposes, including church projects in West Virginia that burnished his reputation as a generous benefactor.

The bishop also drew on it to send the second check to Farrell for the apartment, this time for $15,000, church financial records and emails show.

In all, $321,000 was sent out of West Virginia, in apparent contradiction to the stated purpose of the Bishop’s Fund, The Post found. Church officials have declined to identify the out-of-state recipients.

The hospital was the charity’s only source of funding, tax filings and hospital audits show. As a nonprofit institution that relies heavily on federal funding through Medicare, the hospital is subject to restrictions on how it uses its money.

In the interview with The Post over the summer, Bransfield defended the cash gifts to Farrell, saying they were “funds that I had raised.” He and his attorney did not respond to subsequent questions about The Post’s findings.

Bransfield stepped down in September 2018 amid allegations he misused church money and sexually harassed seminarians and young priests, claims that he has denied. He has since been stripped of his clerical authority and ordered to leave the West Virginia diocese.

During his 13-year tenure at the Diocese of Wheeling-Charleston, Bransfield spent millions of dollars of diocese money on extravagances, including travel on chartered jets, lavish furnishings at his official residence and nearly 600 cash gifts to fellow clergymen, according to the findings of an internal church investigation previously obtained by The Post.

Church officials have declined to release the investigators’ confidential report, but a Post story in June detailed many of its findings.

To support his lavish spending, Bransfield long relied on oil revenue from land in Texas that was left to the diocese more than a century ago. The church investigators wrote that he created the Bishop’s Fund in 2014 to serve as a “vehicle” to also access and spend hospital money, a finding that has not previously been reported.

The Post determined that the money sent to Farrell and others outside the state originated at the hospital by examining tax filings and internal church documents and emails as well as other records.

Minor, the diocese’s human resources director, told The Post in an interview that he understood the transfers to be legally permissible and properly authorized.

Spokesmen for the diocese and hospital declined requests for comment about the Bishop’s Fund.

Two members of the hospital board, Sister Mary Palmer and Richard Polinsky, said in interviews that they had never heard of the Bishop’s Fund and did not recall approving multimillion-dollar transfers.

A third board member, retired FBI agent Thomas Burgoyne, questioned how any money that started in the hospital ended up passing through Bransfield’s personal account. “Based on my experience in law enforcement, this is something that needs to be looked at,” said Burgoyne.

Two tax law specialists and a former federal prosecutor who examined related documents at The Post’s request agreed, citing laws that restrict how federally funded hospitals and nonprofit groups can use money.

Under one federal law, hospitals that receive substantial federal benefits through programs such as Medicare are prohibited from directing money to any entity or person without proper authority or purpose. Under another, charity money may not be used to unduly benefit an individual.

“Lining the pockets of private citizens, even when those private citizens are priests, is a violation of charities and tax law,” said Jill Horwitz, professor and vice dean of the University of California at Los Angeles law school.

In recent weeks, the Justice Department has sought information about the transfers to the Bishop’s Fund as part of a lawsuit that accuses the hospital of defrauding the federal government of millions of dollars by filing false claims for Medicare reimbursement. Hospital officials deny the allegations.

A diocesan windfall

From the time he became bishop in 2005, Bransfield poured church money into building projects and other work, while also spending on personal luxuries for himself, according to the confidential investigative report.

But he faced mounting criticism from parishioners for his extravagances after local news accounts of his spending on his church residence, a chauffeur and a personal chef. Bransfield has defended his spending as appropriate.

By 2014, the bishop was seeking a way to continue spending on projects of his choosing without “making the subsequent donations appear to be coming from the DWC,” according to the confidential investigative report, using the shorthand for the diocese.

He found an answer in the coffers of Wheeling Hospital.

Bransfield, as bishop, served as chairman of the hospital board. Long a money-loser, the hospital experienced a financial turnaround under consultants hired to lead it after Bransfield’s arrival in Wheeling. Revenue soared and cash on hand skyrocketed, financial statements show. Much of its revenue came from Medicare and Medicaid reimbursement.

The hospital’s operations included a self-insurance entity, Mountaineer Freedom Risk Retention Group, which pooled hospital money to offset malpractice claims. Bransfield found “extra pockets of cash” on Mountaineer’s balance sheet, according to the confidential investigative report.

He “felt he should be able to have access to that money,” the report said.

In December 2014, Bransfield created the Bishop’s Fund. The stated purpose of the charity was “to provide for the pastoral care of the diocese” and “charitable care of the people of the diocese,” tax filings show.

Church investigators later concluded that the fund was a “vehicle for Bransfield to access [Mountaineer] money and spend on projects of his choosing,” according to their report.

The financial transfers from the hospital began in 2015. They involved multiple steps and were carried out with help from hospital administrators, Bransfield aides and allies on the boards of multiple nonprofit groups.

The first step involved the closure of Mountaineer Freedom Risk and the creation of a new self-insurance entity. During the changeover, hospital officials carved out $8 million from Mountaineer and gave it to another hospital subsidiary, a charitable group called the Medical Park Foundation, hospital audits show.

In state incorporation filings, Medical Park said it existed to raise contributions for the benefit of Wheeling Hospital and the “sick, injured, disabled, infirm, aged and poor” in the community.

Medical Park, run by several hospital executives and board members, transferred the $8 million to the Bishop’s Fund, according to state records and tax filings.

In 2016 and 2017, the hospital gave another $13 million to the Bishop’s Fund, some directly and some through Medical Park, tax filings show.

Hospital officials referred questions about those transfers, including whether the board had approved them, to an outside lawyer, David Paragas.

Paragas initially agreed to answer questions but later sent an email saying the hospital would not do so. “At this stage, it would be inappropriate for Wheeling Hospital to comment,” Paragas wrote.

n the interview with The Post, Minor said he had no knowledge of how the transfers from the hospital came about. The next day, he wrote in an email that he had checked with a hospital attorney and was told that the hospital board had approved the transfers.

“The board acted on the advice of independent counsel for the hospital, the transactions were reviewed by independent counsel for the hospital, and the transfers were approved by the board,” he wrote.

He declined to provide minutes documenting those votes and said he had no further comment.

Palmer and Polinsky, who served together on the hospital board for a decade, said they would have recalled votes for such large transfers.

“It would be unusual and eye-catching at a meeting to say, ‘We’re going to take this amount of money and send it to an open fund that the bishop would have,’ ” said Polinsky, who served on the board until late last year. “I have no recollection of anything like a Bishop’s Fund.”

Palmer said she was never told about the Bishop’s Fund. “I’m not aware of any approval, or even that it was brought up,” she said.

The lay investigators who prepared the confidential report about Bransfield wrote that they also found no indication the hospital board approved the transfers. Their work included an interview with the hospital president, Msgr. Kevin Quirk, who was also on the board of the Bishop’s Fund and served as a top aide to Bransfield in the diocese. He did not respond to messages seeking comment for this story.

“We found no evidence that the Board of the Hospital was consulted or approved the establishment and funding of The Bishop’s Fund,” the investigative report said.

Msgr. Frederick Annie, who served on the hospital board, “rolled his eyes” when investigators asked about the board’s oversight role, “suggesting an absence of any meaningful review,” the confidential investigative report said.

Funding a legacy

Though few parishioners knew about the Bishop’s Fund, most of the group’s money made its way to projects and initiatives across the state. Among the beneficiaries were select Catholic schools and churches in West Virginia, tax and church records show. In local news accounts, the recipients were often quoted praising Bransfield personally for his generosity.

The largest amount by far went to a financially troubled Catholic university in Wheeling that had no formal affiliation with the diocese. Wheeling Jesuit University had asked Bransfield for financial assistance because it was buckling under massive debt and declining revenue.

Bransfield, nearing retirement, saw a chance to expand the diocese’s real estate holdings and add luster to his reputation, according to Mark Phillips, then the chief of staff at Wheeling Jesuit, who regularly met with Bransfield to discuss the school’s fate.

“Bransfield was very concerned about his legacy,” Phillips wrote to The Post. “He clearly saw the investments in the Diocese, Wheeling Hospital, and the University as his personal gifts to West Virginia.”

In 2016 and 2017, the Bishop’s Fund gave a total of $12.6 million to the university to help keep it afloat. In exchange, the diocese gained control of the university and its campus near the Ohio River. The school, now known as Wheeling University, continues to struggle financially.

Bishop’s Fund grants helped pay for a new air conditioning system at the gymnasium of Wheeling Central Catholic High School. School President Lawrence Bandi, who at the time served on the board of the Bishop’s Fund, renamed the facility after Bransfield.

“This was a great opportunity to acknowledge the generosity of the bishop,” Bandi said at the unveiling. Bandi did not respond to phone calls seeking comment. The high school stripped Bransfield’s name from the gym earlier this year.

The Bishop’s Fund also spent $400,000 on a custom-made Italian altar set that was rejected last fall by parishioners at a church in Wheeling who objected to Bransfield’s lavish spending. The altar now sits in a storage facility, a diocese spokesman said.

Bransfield also wanted to use the Bishop’s Fund to send donations and cash gifts outside of West Virginia, according to the investigative report. But there was a problem. The charity had reported to the Internal Revenue Service that its efforts were exclusively devoted to helping people in West Virginia.

Bransfield and his aides decided they could avoid that impediment by using the diocese as a “pass-through,” Minor said.

“I thought that was legal and, according to accounting, that we could make a grant to the diocese and that the diocese could make a grant as a pass-through to a Catholic entity,” Minor said during the interview at his home.

Minor provided The Post with a Bishop’s Fund document listing grants made by the group totaling $17 million. The money given to the diocese and sent out of West Virginia — including money for Farrell’s apartment — was described only as supporting “operations.”

The Post determined that some $60,000 of that was donated through the diocese to the National Shrine of the Immaculate Conception in the District, where Bransfield had worked as a finance director and rector. The donation was used to help renovate the church’s iconic dome, according to a spokesman for the National Shrine.

Disbursements related to the two gifts for Farrell’s apartment in Rome account for another $54,000.

Farrell was one of more than 130 clergymen, including more than a dozen cardinals, who received cash gifts totaling $350,000 from Bransfield during his time in West Virginia, The Post previously reported. Most of those gifts predate the creation of the Bishop’s Fund.

Bransfield wrote the checks from his personal account. The West Virginia diocese reimbursed him by boosting his compensation to cover both the value of the gifts and the taxes he would owe on the added compensation, church investigators found.

As a tax-exempt organization, the diocese is supposed to use its money only for charitable purposes and may not excessively enrich any individual, according to IRS rules.

In addition to the $29,000 that went to Farrell, the diocese paid Bransfield $25,000 to cover the income taxes Bransfield would owe, drawing all of the money from the Bishop’s Fund, according to church documents and interviews with Minor and Bransfield.

Multiple emails among diocese leaders directly link the money from the Bishop’s Fund to the Farrell gifts.

“Hey there. Just a note that I need to order a check from The Bishop’s Fund, payable to DWC, to cover a check as a gift to Abp Kevin Farrell at the Vatican,” Minor wrote on May 12, 2017.

In statements to The Post earlier this year, Farrell and more than a dozen other recipients of Bransfield’s gifts said they had presumed the money was the bishop’s. Farrell and the others pledged to repay the diocese.

A Vatican spokesman confirmed this month that Farrell had done so.

Farrell is a close adviser to the pope and an influential figure in the church. He and Bransfield became friends in the 1980s and 1990s, when both held church posts in Washington.

The men had the same mentor, former cardinal Theodore McCarrick, a legendary fundraiser for the church who was defrocked after the church found him guilty of sexual abuse. Bransfield and Farrell also served together on the influential Papal Foundation, a charity that raises money from wealthy American Catholics for initiatives chosen by the pope.

The gifts to Farrell and other clerics were cited in a letter by Quirk, Bransfield’s aide, as an example of his alleged misconduct.

Quirk’s August 2018 letter to Baltimore Archbishop William Lori, obtained by The Post, accused Bransfield of trying to buy influence in the church. Quirk wrote that Bransfield was seeking help from Farrell to arrange a one-on-one visit with the pope last fall.

“It is my own opinion that His Excellency makes use of monetary gifts, such as those noted above, to higher ranking ecclesiastics and gifts to subordinates to purchase influence from the former and compliance or loyalty from the latter,” Quirk wrote.

Bransfield denied Quirk’s allegation. “I didn’t do these things for people to give me something,” he told The Post in July.

Lori, as acting administrator of the diocese, announced in July that he was shutting down the Bishop’s Fund as part of a package of reforms to improve financial oversight in the wake of The Post’s revelations about Bransfield’s conduct. Lori did not detail the concerns about the charity or describe its financial link to the hospital.

“When a bishop is entrusted to care for a diocese, he is expected to be a wise and honest steward of its resources,” Lori wrote in an open letter to Catholics. “But here in Wheeling-Charleston, these procedures and policies did not prevent the bishop from misusing diocesan funds.”

A spokesman said the $4 million remaining in the charity coffers would be transferred to the diocese.

‘It is my hospital’

The Justice Department lawsuit against Wheeling Hospital, based on a whistleblower’s claim, was unsealed in March and is still in its early stages. It alleged that the hospital and its then-leader, Ronald Violi — named as a defendant and described in court records as Bransfield’s “hand-picked” chief executive — were responsible for thousands of false claims for reimbursement from the federal health-care program for the elderly.

Justice said that the hospital’s financial turnaround was driven in part by the alleged scheme.

The lawsuit said the executives “reported to and took direction from Bishop Bransfield,” who personally maintained control over hospital operations and set the pay of the chief executive.

“It is my hospital,” Bransfield often said, Violi told Justice Department lawyers in a recent deposition.

Bransfield was not named as a defendant.

The hospital has described the allegations as “an unfair attack” on its values and physicians.

Violi stepped down as chief executive earlier this year. He has denied wrongdoing. His attorney did not respond to requests seeking comment for this story.

In a filing this month, Justice Department lawyers sought information about Violi’s relationship with Bransfield and about the transfers to the Bishop’s Fund.

They alleged that Bransfield increased Violi’s compensation at the same time the hospital was directing “a large amount of its (allegedly ill-gotten) profits towards the Diocese and the now-dissolved Bishop’s Fund.”

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