A federal bankruptcy judge this week threatened attorneys for the Diocese of San Diego with contempt of court charges for attempting to hide the diocese’s assets during settlement negotiations with sex-abuse victims, but instead ordered an external audit of the diocese’s finances and property.
The diocese had filed for federal bankruptcy protection in February, the third Catholic diocese to do so in the US, just as civil trials on sex-abuse claims were to begin.
But on March 29, the judge called the attorneys on the carpet in her office when she found a memo sent to pastors that looked to her like they were trying to hide diocesan assets.
Adler cited a March 29 letter sent by a diocese parish organization to pastors urging them to get new taxpayer identification numbers and transfer funds to new accounts. The threat Monday came six weeks after the diocese sought bankruptcy protection amid lawsuits by more than 140 people who accuse priests of sexual abuse.
The judge said any post-bankruptcy transfers between the diocese and parishes outside of normal cash operations violate her ruling against shifting the diocese’s assets while the bankruptcy case is pending. She said any transfers require court approval.
In a sternly worded order, Adler said attorneys Susan Boswell, Jeffry Davis and Victor Vilaplana appear to have ”conspired with parishes” to create new bank accounts separate from the diocese.
Boswell wrote in court documents Tuesday that no intentional misrepresentations or misstatements had been made. She said the diocese has ”no access or control” over money in more than 770 bank accounts opened by parishes and parochial schools under the diocese’s taxpayer identification number.
Meanwhile one name remains mysteriously absent from this story and we’re left wondering who’s leading the Diocese of San Diego: the lawyers or Bishop Robert Brom?
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