Financial Improprieties – Page 20

April 1, 2014

Atlanta archbishop apologizes over $2.2M mansion

File under: Follow the money

The Roman Catholic Archbishop of Atlanta apologized Monday for building a $2.2 million mansion for himself, a decision criticized by local Catholics who cited the example of austerity set by the new pope.

Archbishop Wilton Gregory recently moved into a nearly 6,400-square-foot (595-square-meter) residence. Its construction was made possible by a large donation from the estate of Joseph Mitchell, nephew of Margaret Mitchell, author of “Gone With The Wind,” the Civil War epic that made his family wealthy. When Mitchell died in 2011, he left an estate worth more than $15 million to the archdiocese on the condition it be used for “general religious and charitable purposes.”

Gregory said that he has received criticism over the spending in letters, emails and telephone messages.

“I am disappointed that, while my advisors (sic) and I were able to justify this project fiscally, logistically and practically, I personally failed to project the cost in terms of my own integrity and pastoral credibility with the people of God of north and central Georgia,” Gregory said in a column posted on the website of the archdiocesan newspaper, The Georgia Bulletin.

“I failed to consider the impact on the families throughout the Archdiocese who, though struggling to pay their mortgages, utilities, tuition and other bills, faithfully respond year after year to my pleas to assist with funding our ministries and services,” he added.

The Catholic leader said he will discuss the situation with several diocesan councils, including a special meeting of its finance council. If church representatives want the bishop to sell the home, Gregory said he will do so and move elsewhere.

The purchase of the sprawling home was part of a real estate deal made possible by money from Joseph Mitchell’s estate.

In his will, Mitchell requested that primary consideration be given to the Cathedral of Christ The King, where he worshipped. The cathedral received $7.5 million for its capital fund and spent roughly $1.9 million to buy the archbishop’s old home, according to tax records. Cathedral officials are planning to spend an additional $292,000 to expand Gregory’s old home so its priests can live there, freeing up space on the cathedral’s cramped campus.

After selling his home, Gregory needed a new residence.

The archbishop said that he made a mistake while designing a home with large meeting spaces and rooms for receptions and gatherings.

“What we didn’t stop to consider, and that oversight rests with me and me alone, was that the world and the Church have changed,” Gregory said.

He demolished the one-story home on Mitchell’s property, which was donated to the church, and replaced it with a Tudor-style mansion. In January, a group of local Catholics met with the archbishop and asked that he sell the large home and return to his old residence. They cited the example of Pope Francis, who turned down living quarters in a Vatican palace and drives a simple car.

“The example of the Holy Father, and the way people of every sector of our society have responded to his message of gentle joy and compassion without pretense, has set the bar for every Catholic and even for many who don’t share our communion,” Gregory said.

Complete Article HERE!

January 30, 2014

Minnesota Catholic Church Leaders Cover Abuse With Cash

File under: Follow The Money

by Robert Lawson

Catholic church leaders in Minnesota were investigated by Minnesota Public Radio (MPR), who alleges that the church embezzled funds to cover child abuse and other misconduct with church cash, sources in the Twin Cities report. The investigation cited internal church documents to make their case that leaders of the Catholic church, such as the Archdiocese in the Twin Cites (Minneapolis/Saint Paul), paid millions of dollars to keep secrets quiet.

MPR reported that the church had several secret accounts that led to financial abuse in the system. The accounts were used for payoffs for people like Rev. Stanley Kozlak, who fathered a child. Kozlak received payoffs for rent and living until he reached the age to retire on social security benefits. The internal documents in the church indicate that part of the agreement held that Kozlak would still be a priest, the Archbishop would have to sign a letter that states Kozlak isn’t a pedophile and that there would be negotiated child support. Over the course of nine years, from 2002 to 2011, the accounts had been used repeatedly and paid out around $11 million. That amounts to about three percent of revenue for that time period.

The efforts by the Catholic church to deal with clergy problems is staggering. Money was used to quietly allow some to leave their ministries. This strategy proved to be the back door to embezzlement within their secretly constructed financial system. Legal costs and therapy were also listed expenditures. In one instance, a private investigator was hired and paid more than $1o0,000 the Rochester Post Bulletin reported via Associated Press (AP). The Minnesota Catholic church leaders investigated appeared to have decided it was easier to cover up the problems with cash, but other abuse followed and it proved to be an expensive strategy.

The archdiocese made a statement on Thursday to address news of the investigation by MPR. They said they already hired a new CFO in December of 2012 to improve transparency, according to the report in the Post Bulletin. There are no government regulators that the Catholic church leaders are accountable to and the archbishop can spend money how he sees fit. There is a council that advises him, however. There will be a full audit completed by February.

MPR investigated to find that these payments, referred to as “disability” in the ledger account, were paid to victims and clergy. MPR reported a culture that kept many secrets within the walls of the Catholic church. Once accountant already pleaded guilty to stealing around $650,000 in cash from the church during these activities. He said people there knew what questions not to ask.

The MPR report and investigation also reveals the plump and healthy financial condition of the church, which has been infused with revenue over a five-year time span. Their operating revenue was up to around $40 million up to the point of 2011. Cash levels and assets grew as well, but now the Catholic church faces pressure from legal circumstances. The Minnesota Catholic church leaders tried to cover abuse with cash only to find more abuse and the threat of losing that very cash.

Complete Article HERE!

October 21, 2013

Finance scandal spurs German bishops to reveal secret funds

File under: Follow the money! Truth is, all bishops have huge slush funds and these guys are showing us only what they want us to see.

By Tom Heneghan

German Catholic bishops are scrapping centuries of secrecy and reporting the value of their private endowments as a scandal caused by a free-spending prelate puts pressure on them for more financial transparency.

Limburg Bishop Franz-Peter Tebartz-van Elst – dubbed “the luxury bishop” – has shocked the Church by admitting six-fold cost overruns on construction of his luxurious new residence, which is now priced at 31 million euros, most of which will be paid from his ample reserves.

She's got the bling! — She’s got the bling!

His lavish spending clashes with the humble style of Pope Francis, who urges bishops to turn away from wealth and pomp and get closer to the faithful. Francis has also promised to clean up the murky finances of the Vatican’s own bank.

The Limburg scandal has also prompted worried German Catholics to ask what their dioceses were doing.

“We take these concerns very seriously,” Bishop Karl-Heinz Wiesemann of Speyer said in a communique revealing his 46.5 million euro reserve.

German dioceses have secret reserves called the “bishop’s chair” known only to the bishop and a few advisors. Run as a diocesan nest egg and source of funds for special projects, they are not taxed and not listed in the annual balance sheets.

In some older dioceses, “bishop’s chair” reserves include age-old property holdings, donations from former princely rulers and funds from German states over the past two centuries. Their make-up and value vary widely from diocese to diocese.

RICHES AND MORE RICHES?

Cologne, the largest and reportedly richest diocese in Europe, announced on Tuesday “in connection with the current discussion about Church finances” that its archbishop had reserves amounting to 166.2 million euros in 2012.

It said the 9.6 million euro earnings from its investments were, as in previous years, added to the diocesan budget of 939 milllion euros in 2012, three-quarters of which was financed by the “church tax” levied on churchgoers.

A critic of church financial secrecy, Berlin political scientist and journalist Carsten Frerk, said Cologne’s total should be about 1.1 billion euros because its large real estate investments were listed at only nominal values.

“They don’t pay tax so they don’t update their assessments,” he told Reuters. “It’s not in their interest to publish these amounts because then they wouldn’t get as many donations.”

Dioceses also had holdings in other accounts and some even have their own private banks, somewhat similar to the Vatican’s bank, so their full wealth is hard to calculate, he added.

Cologne diocesan officials were not immediately available for comment. Cathedral Provost Rev Norbert Feldhoff told the diocesan radio station it would be hard to explain some aspects of Church finances if all details are published.

“There are big sums and there are problems,” he told Domradio. “We can explain it all to experts, but it could be difficult for the average housewife in Cologne to understand.”

TIGHT-LIPPED

At least six of the country’s other 26 dioceses also opened their books, several showing much smaller “bishop’s chair” reserves but some revealing quite large amounts.

The small diocese of Trier, Germany’s oldest, had a reserve of 84 million euros and said part of its earnings went to pay damages to victims of the clerical sexual abuse scandals that rocked the German Church in recent years.

Limburg, where Tebartz-van Elst’s lavish spending has led to loud calls from priests and parishioners for his resignation, has not posted its reserves. Media reports have estimated the sum at about 100 million euros.

German dioceses have traditionally been tight-lipped about their “bishop’s chair” reserves. In 2010, 25 of the 27 dioceses refused to discuss them when asked by Der Spiegel magazine.

Last week, four of the five dioceses in North Rhine-Westphalia – including Cologne – declined to give any information to the local West German Radio station. By Tuesday, only Paderborn diocese had still not published its details.

Germany’s church tax, collected by the state and handed over to the churches, raised 5.2 billion euros for the Catholics and 4.6 billion euros for Protestants in 2012, making them major economic actors at home and abroad.

Complete Article HERE!

July 20, 2013

Pope’s bank clean-up man ‘found stuck in lift with rent boy’

As the man charged with cleaning out the stables at the scandal-struck Vatican bank, Monsignor Battista Ricca will need Machiavellian cunning, good fortune and a whiter-than-white record to have even a fighting chance.

But Pope Francis’s new banker appears to possess none of these attributes after it was reported yesterday that he was found stuck in a lift with a rent boy. Msgr Ricca, as Francis’s new primate with responsibility for the troubled financial institution, known officially as the IoR (Institute for Religious Works), is supposed to usher in new transparency and badly needed reforms after years of financial scandal.

Earlier this month, a major report from finance police and magistrates warned that a lack of checks and controls by the IoR and the Italian financial institutions it had dealings with made the Vatican’s bank a money-laundering hot spot.

It is claimed that Msgr Ricca, 57, impressed Francis with the way he ran three key residences used by cardinals, bishops and priests visiting Rome. But detailed claims have emerged detailing how in 1999, Ricca took a Vatican diplomatic posting in Uruguay and moved his lover, Patrick Haari, a Swiss army captain, in with him, to the outrage of church figures and locals in the conservative South American nation. Captain Haari was forced out by the hardline Polish nuncio Janusz Bolonek in 2001.

But there were more problems for Ricca when he was attacked in a cruising ground that year, and soon after firemen had to rescue him from a broken lift, in which he was trapped with a youth known by local police. The weekly news magazine L’Espresso claims that Msgr Ricca was able to get the position as IoR prelate because the supposedly powerful “gay lobby” in the Vatican airbrushed his colourful CV.

Gay sex scandals at the Vatican have made the headlines before. In 2010 it emerged that one of Pope Benedict’s ceremonial ushers and a member of the Vatican choir were involved in a gay prostitution ring.

Vatican spokesman Padre Federico Lombardi sought to dismiss the claims about Msgr Ricca’s private life. “What has been claimed about Msgr Ricca is not credible,” he said. Msgr Ricca himself has not yet responded to the allegations. But La Repubblica noted that the Vatican had emphasised that his appointment as prelate for the IoR was technically an interim one, thus raising the possibility that the job might not last long.

Complete Article HERE!

July 1, 2013July 1, 2013

Archdiocese of Milwaukee faces Monday deadline to make public clergy sex abuse documents

The Archdiocese of Milwaukee was expected to release thousands of pages of documents related to clergy sex abuse on Monday, including the personnel files of more than three dozen priests and the depositions of church leaders including New York Cardinal Timothy Dolan, the former archbishop of Milwaukee.

A deal reached in federal bankruptcy court between the archdiocese and victims suing it for fraud called for the documents to be made public by July 1. Victims say the archdiocese transferred problem priests to new churches without warning parishioners and covered up priests’ crimes for decades. Many pushed for the documents’ release in the belief that it would be an important part of their healing.

Similar files made public by other Roman Catholic dioceses and religious orders have detailed how leaders tried to protect the church by shielding priests and not reporting child sex abuse to authorities. The cover-up extended to the top of the Catholic hierarchy. Correspondence obtained by The Associated Press in 2010 showed the future Pope Benedict XVI had resisted pleas in the 1980s to defrock a California priest with a record of molesting children. Cardinal Joseph Ratzinger led the Vatican office responsible for disciplining abusive priests before his election as pope.

The Milwaukee collection has drawn interest because of the involvement of Dolan, the president of the U.S. Conference of Catholic Bishops and the nation’s most prominent Roman Catholic official. Dolan has not been accused of transferring problem priests. He took over as archbishop in mid-2002, after many victims had already come forward. But there have been questions about his response to the crisis, including payments made to abusive priests when they left the church.

The archdiocese has characterized the money, as much as $20,000 in some cases, as a kind of severance pay meant to help priests transition out of the ministry. Similar amounts were made to men leaving the priesthood long before allegations of sexual abuse surfaced in the Catholic church, spokeswoman Julie Wolf said last year, when the payments came to light.

Charles Linneman, 45, of Sugar Grove, Ill., was among the abuse victims who spoke out against the payments and pushed for the archdiocese to release its records. Linneman said he was an altar boy when he met Franklyn Becker at a Wisconsin parish in 1980. He read the priest’s file several years ago when it became public during litigation in California, where Becker also served.

“It helped me move on,” Linneman said. In particular, he was relieved when the file showed no reports of children being abused after him, he said. He had long wondered if coming forward before he did in 2002 would have kept other children from being hurt.

Abuse victims have long sought to hold the church accountable, but most didn’t come forward until well into adulthood, when it was too late under Wisconsin law to sue the church for negligence in supervising its priests. A 2007 Wisconsin Supreme Court decision gave them a window, saying the six-year limit in fraud cases didn’t start until the deception was uncovered. The archdiocese filed for bankruptcy in 2011, once it became clear that it was likely to face a slew of lawsuits.

Complete Article HERE!