Pope Benedict XVI is the seventh most powerful person in the world; Charles and David Koch combined were #45 according to Forbes Magazine which bills itself as providing “Information for the World’s Business Leaders.”
During the first half of this year, 258 U.S. bishops went to Rome to renew their allegiance to the pope and for private meetings with Benedict and other Vatican officials. “But the pope chose to speak to them not of prayer or sacraments, but about threats to religious liberty, the proper relations between Church and State.”
In his only address to the bishops made public, Benedict “warned of the ‘grave threat’ to religious liberty in the United States ‘presented by a radical secularism which finds increasing expression in the political [i.e. Democratic Party] and cultural spheres’....The pope said he was particularly concerned with 'certain attempts being made [i.e. by President Obama] to limit that most cherished of American freedoms, the freedom of religion.'”
Without regard as to whether or not this constitutes interference by a foreign head of state in our domestic affairs, Mitt Romney repeated the pope’s message on July 18th at a campaign stop. When asked about his views on the president’s “attack on religious freedom,” Romney replied:
Religious liberty, our first freedom of those enumerated in the Bill of Rights. And the president and his administration said they are going to usurp your religious freedom by demanding that you provide products to your employees, if you're the Catholic Church, that violates your own conscience….The only 2012 candidate endorsed by any Catholic official is Romney. On January 7th, five former Catholic ambassadors to the Vatican gave him their support for President, and that was when Catholics Rick Santorum and Newt Gingrich were in the race.
That attack on religious freedom I think is a dangerous and unfortunate precedent. And I know we're not all Catholic in this room. Many presumably are. But I feel that we're all Catholic today. In our battle to preserve religious freedom and tolerance and freedom in this country, it is essential for us to push back against that.
Romney received a 20-second standing ovation.
(If you find this diary about money overly long, stop when you understand why the pope is #7 and the Kochs #45. In a future diary, I hope to illustrate how the pope wields his influence not only in the U.S. but also in world affairs.)
Benedict’s power derives from the inestimable wealth of the Roman Catholic Church obtained from tyrants and plutocrats past and present and now used in the service of the corporatocracy. For the most part, that wealth is a closely-guarded secret. However, there are occasional glimpses at the tip of the iceberg of the Roman Catholic Church’s “vast riches.”
The Vatican Empire (1968) by Nino Lo Bello, a Rome correspondent for Business Week, New York Journal of Commerce and the Herald Tribune, described the Vatican as “a nerve center of high finance” based on corporate and public records. From the book jacket: “One third of Rome is owned by the Holy See. The Vatican is one of the world's largest shareholders, with a stock portfolio that can be conservatively estimated in the billions. He also gives evidence that the Vatican is heavily involved in Italian banking and that it has huge deposits in foreign banks.”
No one has attempted a similar study since, but there is no reason to believe much has changed other than the Vatican “abandoning” Italian banks perhaps due to the recent scrutiny by Italian financial regulators. In February 2012, the BBC reported: "The Vatican owns about 20% of Italy's properties. Italy's Catholic Church has 110,000 properties, worth about €9 billion including shopping centers and residential property.” From the London Telegraph: “In Italy as a whole, there are 3,300 hotels run by religious bodies, which have an annual turnover of £3 billion." But the current investment portfolio remains a mystery.
The Roman Catholic Church is attractive for funding by the corporatocracy and the Vatican is the logical de facto headquarters of the Religious Right because it heads a worldwide financial network anchored in the Vatican Bank, formally the Institute for Religious Works or its Italian acronym, the IOR.
“The IOR is located within the territory of Vatican City State, beyond the jurisdiction and surveillance of various national banks," explained the head of the Vatican press office to the Financial Times. He could have added it is beyond the jurisdiction of any laws or regulations as well.
Everything about the IOR is secret. In addition to the names of the depositors, "the Vatican Bank's holdings and its specific transactions are opaque," declared the Ninth U.S. Circuit Court of Appeals in deciding a case brought by the survivors of the Croatian holocaust against the IOR for receiving and holding gold and jewelry stolen from them. (As in three suits for the sex abuse of children and a RICO suit involving fraud, the Vatican’s sovereign immunity was an effective shield against U.S. judgment.)
As of 2009, the IOR was believed to hold assets of some $5 billion. Part of institution’s profits come from money-laundering i.e. receiving funds from those who for illegal, immoral or political reasons deposit their “dirty” money to be “washed” or transferred through the IOR into legitimate outlets. The IOR takes a cut off the top for this “service.”
“The Vatican financial system has been the protagonist, not the victim, of the criminalization process of the [Italian] economy,” wrote Umberto Santino of the Sicilian Center for Documentation, a study center of the Mafia since 1977 which works for peace, memory, research and civic engagement.
Vaticano S.p.A. (Vatican Inc), a best-selling book in Italy by Gianluigi Nuzzi published in 2009 is based on “over 4 thousand documents that make up the archive of a privileged witness,” an advisor to cardinals in charge of the IOR. Msgr. Dardozzi requested his records be made public after his death. The documents show the IOR to be “a unique ‘off shore’ corridor for politicians around the world who want to keep their money away from legal controls….The IOR is like a credit card that ensures privileges to be granted in exchange for political backing, legal provisions and business support.”
The IOR also maintains an offshore Cayman Islands banking division. “Reports are that the bank’s clients include German arms dealers and criminal elements.” In 2011, the Bahamas Government refused to cooperate with Italian authorities still trying, thirty years later, to find the money stolen from investors during the early 1980s IOR/Banco Ambrosiano scandal involving “murder, Mafia plots, and international money laundering schemes.”
While the IOR is untouchable, its Achilles heel is that it must transact business with banks outside the borders of the Vatican City State and the Cayman Islands. After 9/11, the world’s financial community put safeguards in place applicable to the majority of banks to identify terrorists and others who were laundering their clandestine funds.
In September 2010, under direction from the Financial Intelligence Unit of the Bank of Italy, financial authorities froze €23 million ($33 million) from an IOR account at the Rome branch of Credito Artigiano. According to court documents, prosecutors say the Vatican Bank deliberately flouted anti-laundering laws “with the aim of hiding the ownership, destination and origin of the capital.” Court documents also reveal investigators' suspicions that transactions totaling €900,000 involved clergy acting as fronts for corrupt businessmen and the Mafia.
The Vatican called the seizure of assets a “misunderstanding” and the money was released in June 2011, but Roman magistrates are continuing their probe. Judge Maria Teresa Covatta was quoted as saying the intended beneficiaries of the transactions were still unclear.
The just published His Holiness: The Secret Papers of Pope Benedict XVI, also by Gianluigi Nuzzi, is based upon a new set of Vatican documents turned over to Nuzzi because his “deepthroats” admired his previous work. “The problem of child molestation in America is described in the documents as a simple financial issue: all the money to be paid to the accusers to avert humiliating public trials public.” In addition to “the array of detailsabout smear campaigns, corruption, intrigue, ungodly ambition, ties with the underworld, and sexual scandal” among the Vatican hierarchs, the documents also expose “money laundering, corruption, and threats.”
JP Morgan Chase announced in March 2012 it was closing an IOR account in its Milan affiliate due to a lack of information it had been requesting since 2010 about the source of deposits, suspected to be Mafia Godfather, Matteo Messina Denaro. JP Morgan reported €1.8 billion had been deposited in the last 18 months in the account. (And this is one account out of how many throughout the world?)
The Italian daily, Corriere della Sera, reported Italian prosecutors obtained documents seized during raids on former IOR president, Ettore Gotti Tedeschi’s, home and office in early June 2012. The newspaper stated “investigators were focusing on accounts at the Vatican Bank held by ‘politicians, shady intermediaries, contractors and senior (Italian) officials’ as well as ‘people believed to be fronts for mafia bosses.’ Investigators have reportedly found ‘property investments and Church property sales that could disguise money transfers to fronts and the need to launder through firms and banks not subject to direct controls like the IOR.’”
Don’t be misled by the July 18, 2012, report from the Council of Europe’s MONEYVAL committee of financial experts. It evaluated only the measures put in place “to combat money-laundering and terrorist financing,” and not whether these measures had ever been used – which they haven’t. It’s just more Vatican PR like the supposed measures the pope instituted to “combat” child sex abuse. For those who remember, in November 2010 it was widely reported that Benedict was demanding that all bishops put in place “effective, quick, articulated, complete and decisive plans for the protection of children, bringing perpetrators to justice and assisting victims.” Yet on July 11, 2012, Monsignor Charles Scicluna, the Vatican’s top investigator of clerical sex abuse, said “most of the bishops’ conferences around the world have missed a Vatican deadline on drawing up anti-abuse guidelines,” and that no action was planned at this time other than "a letter of reminder," and more "evaluation."
Other Vatican Agencies
In addition to the IOR, there are 46 other agencies, “departments” or foundations with their own finances operating in the Vatican City State.
The Administration of the Apostolic Patrimony of the Holy See (APSA) manages the real estate and investment portfolios. APSA “made a profit of £33 million in 2004/5 from the sale of various buildings.”
The Government of the Vatican City State manages the museum and other tourist attractions as well as the post office, etc. The CIA World Factbook lists the Holy See’s “industries” as “printing; production of coins, medals, postage stamps; mosaics and staff uniforms; worldwide banking and financial activities.”
The Congregation for the Evangelization of Peoples, better known by its old name of “Propaganda Fide,” controls its own “mini-financial empire.” In 2010, the Vatican admitted “possible errors” in managing properties owned by Propaganda Fide, reported to have assets worth €9 billion.
The Prefecture for Economic Affairs is supposed to coordinate all the financial activities. However, “Observers believe that the real core of the scandal [exposed in His Holiness] is a power struggle over control of the Vatican's finances.”
The pope has his own income and wealth separate from the Vatican for his private use. Although not enough to earn him a position on Forbes “World’s Billionaires List,” Benedict sometimes tries to dress like one. The pope commissioned for himself a precise 30-piece copy of the vestments used by Giovanni de Medici, son of Lorenzo the Magnificent, for de Medici’s coronation as pope, including reproducing the fabric and coat of arms - damask of red silk and gold thread, with brocade details of the heraldic motifs. We don’t know how much that cost but we do know that the cost of just one of Cardinal Raymond Burke’s liturgical ensembles is $30,413 and that Burke is one of 180 cardinals.
In addition to receiving gifts such as a helicopter and Mercedes, the then president of the Vatican Bank gave the pope a gift of $60,000 in 2006. When Benedict visited the U.S. in April 2008, the American bishops gave him a check for $870,000 without explanation of where the money came from. During one of Benedict’s general audiences (where an auditorium is filled with tourists and the pope makes an appearance and says a few words) he was given $51,000 in cash and $11,000 in checks, which works out to approximately $3 million annually.
Once each year, Catholics are asked to make a special donation which goes directly to the pope for his private use known as Peter’s Pence. The Vatican reported the pope received $69.7 million in 2011 up from $67.7 million in 2010.
As of 2010, Pope Benedict had earned $6.6 million in royalties from book sales.
Profits from the IOR are given to the pope for his personal income. According to Vatican expert, Sandro Magister, these profits amount to €70 to 80 million annually ($103.8 - $118.6 million).
This year, members of the Papal Foundation, a group of “major U.S. donors” gave the pope a check for $8.5 million to fund his "charities." A glance at their "recent grants" shows that most goes to build or maintain an international infrastructure of churches, parish buildings, seminaries, convents, schools and bishops’ residences and little to the needy.
The pope rules over 3000 dioceses each controlled by a Vatican-appointed bishop and each with a number of organizations, groups and agencies controlled by the bishop including all the priests and indirectly religious orders of men and women and the laity.
The Church in Ireland at one point owned or occupied at least 10,700 properties including “schools, houses, halls, churches, parks, sports fields, hospitals, farms, and warehouses. Included among those figures were several thousand private homes retained for use by clergy and religious such as the Drumcondra palace where Archbishop of Dublin Diarmuid Martin lives. Additionally, the 1,368 parishes include several parochial homes and other properties.”
“Carsten Frerk, a Berlin political scientist, after years of research, published "Violettbuch Kirchenfinanzen" (The Violet Book of Church Finances) in 2010. Frerk estimates the cash assets of the German Church's legal entities at about €50 billion. The assets, accumulated over the centuries, are invested in real estate, church-owned banks, academies, breweries, vineyards, media companies and hospitals. The church also derives income from stock holdings.”
It was disclosed in 2011 that Weltbild publishing house, 100% owned by German bishops, was selling thousands of pornographic novels with titles such as Sluts Boarding School and Lawyer's Whore with the full assent of the country's leading bishops.” The company earned the bishops €1.7 billion annually.
In June, 2012, Philippine Bishop Jesse Mercado was accused of diverting much of approx P7.4 millionin donations for victims of typhoons, earthquakes, floods and fires into deposit investments with the Bank of the Philippine Islands (BPI) which already had a balance of P91.52 million.
In April 2011, supporters of a Philippine reproductive health bill which would make contraception available denounced by the bishops. They “challenged the Catholic Church to release to the poor” some of the $381 million in stocks owned by just the Archdiocese of Manila. “If the [Catholic Church] truly cares for life, why isn’t it at the forefront of fighting infant and neonatal mortality? Why isn’t it taking care of children of parents who are so poor that their children’s education, health and well-being are sacrificed? What is the Catholic Church doing with its billions? Why does it continue to ask for donations from the poor?’’ asked Elizabeth Angsioco, national chairwoman of the Democratic Socialist Women of the Philippines.
The Italian weekly L’Espresso reported in January 2011 “that after decades of risky investments, a Slovenian archdiocese is now more than $1 billion in debt.” The archdiocese countered that, as of the end of 2010, the total was “just” $24 million. “A network of banks, real estate firms, and media companies,” in which three Slovenian dioceses own a controlling share, are “on the brink of collapse, potentially wiping out the savings of thousands of small investors.” L’espresso reported that the Vatican first got wind something was amiss when a TV station owned by the archdiocese broadcasted pornography in an effort to boost its ratings.
A report from Hungary in April 2011 concerned financial fraud by Fény Ltd., the service administration firm for the Diocese of Pécs, owned by the bishop of Pecs’ private foundation. The story gained widespread attention when police, as requested by Interpol, seized a large cache of child pornography on the computer of a parish priest within the Pécs diocese. A local newspaper used interest in the arrest to remind its readers that the county prosecutor’s office had already announced “the investigation of the diocese prompted by a 65-page document submitted to the prosecutor allegedly pointing to over 40 different crimes, including embezzlement, document forgery, and fraud.”
It was widely reported this past April that from the Spanish Civil War until well into the 1990s “more than 300,000 Spanish babies were reportedly taken from their biological mothers and passed on to adoptive parents” who “allegedly paid up to a million pesetas, or the equivalent of about €20,000 ($25,000), for a child.” In an effort to “deprive leftists of their offspring,” the mothers were told their babies were still-born and then “entrusted to the care of Catholics.” The doctors, priests and nuns who made the arrangements kept the money. “Not everyone in Spain is entirely sympathetic with the mothers' search for their stolen children. Conservative legal scholars, in particular, as well as Church-friendly politicians dismiss the victims' efforts to clear up the cases as a sort of mass hysteria.”
Religious Orders (which usually hold assets separate from the bishops)
In 2010, after the Vatican finally acknowledged, after having the information for decades, that Legionary of Christ founder, Fr. Marcial Maciel Degollado, was a pedophile even abusing his own children born from clandestine unions, the Grupo Integer, the holding company for all the works of the Legion worldwide, had assets totaling an estimated €25 billion.
The Irish Government did a review of the assets of the religious orders that abused those in their care in preparation for a negotiated settlement with tens of thousands of people traumatized in the institutions run by the Catholic Church. It showed that between 1999 and 2009, 17 orders made €667 million in property deals. The properties included land banks, houses, farmyards, a swimming pool, a warehouse, sports grounds and convents. A quarter of all these trades involved the 2,088-member Sisters of Mercy. The order still retained over €1 billion in land assets after these deals. Despite the sales, the various religious orders retained property assets worth €3.07 billion and financial assets of €704 million.
Ascension Health Alliance, sponsored bhe Sisters of St. Joseph of Carondelet, the Daughters of Charity and the Congregation of St. Joseph, is “planning to build a $2 billion ‘health city’ in the Cayman Islands with an India-based hospital group. ‘We’re not considering this a medical tourism facility. That’s not the intent at all,’ said Anthony Tersigni, president and chief executive…. But the system’s for-profit partner, Narayana Hrudayalaya Hospitals in India, has cast the project in sharply different terms. For years, Narayana’s founder, Dr. Devi Prasad Shetty, has promoted the idea of building an offshore medical center to serve primarily American patients who cannot afford health care in the United States.”
It was announced on May 29, 2012 that Ascension Health Care Network, a partnership between the largest Catholic health care system in the U.S., Ascension Health, and private equity firm Oak Hill Capital Partners, is now in “exclusive negotiations” with the leadership of St. Joseph’s Healthcare System, St. Clare’s Health System and St. Mary’s Hospital in Passaic, …that would bring seven Catholic hospitals in New Jersey under the management of a new venture described as the nation’s first for-profit Catholic health system.
“I first heard of Opus Dei in the 1960s,” wrote Robert Hutchison, a Canadian financial journalist residing in Switzerland, “when a Swiss banker friend informed me it was one of the major players in the Eurodollar market. A religious organization speculating in overnight francs and next week’s dollars? That did not sound right at all.” The result of Hutchison’s investigations is his mammoth 1997 book, Their Kingdom Come: Inside the Secret World of Opus Dei updated in 2006. From “its early boost from Spanish fascism’s money” to the “secretive, speculating financial network that Hutchison dubs ‘Octopus Dei,’ it created a financial empire…replete with offshore accounts, financial scandal and nefarious names.” Murder by digitalis-induced heart attacks is their preferred method of dealing with their enemies. This led Opus Dei, pledged to support and promote hegemony of the Roman Catholic Church, “to the jubilant arrival at the right hand of Catholic power.” “On its tightening Church ties, Hutchison sketches in how Pope John Paul II as archbishop of Cracow, Poland, and many other bishops, were brought into Opus Dei’s network, or net.”
The American fraternal society, the Knights of Columbus, has grown to more than 14,000 councils and 1.8 million members throughout the United States, Canada, and 12 other countries. As of 2007, it had “over $14 billion in assets.” The Knights of Columbus continue to be one of the National Organization for Marriage’s biggest funders “while millions of dollars are being funneled into race-dividing anti-gay strategies.” Supreme Knight, Carl Anderson, was a member of the Reagan administration and is one of the directors of the IOR.
The modern day Knights of Malta (Sovereign Military Order of Malta) was formed by Catholic European nobility in the wake of the French Revolution and subsequent 19th century democracy movements to protect their diminishing fortunes. When the wealth of the American nouveau riche was noticed, they dropped the membership requirement of aristocratic lineage and it is now a worldwide group of reactionary wealthy and/or powerful Catholics. The U.S branch “represents the vanguard of American Catholicism, the point at which the Vatican and the Republican elite intersect.” Knights benefitted from their business relationships with the Third Reich, helped Nazi criminals to escape, and funded clandestine terrorism against communism and leftists. Nixon chief of staff, General Alexander Haig and his secretary of the treasury, William Simon, were members as was Reagan’s CIA director, William Casey. From the post World War II period through at least the 1980s, “the American SMOM was one of the main channels of communication between the CIA and the Vatican.”
Opus Dei prelate (Opus Dei has its own order of priests so that confessions by its members remain “in house”), Archbishop Jose’ Gomez, formed the Catholic Association of Latino Leaders, an organization of businessmen, in 2007. CALL participated in a rally for “marriage and family” in Denver during the Democrat National Convention. In 2009, the group received a grant from the Walton Family Foundation (Walmart) for $150,000 per year “to support CALL’s outreach to Hispanic corporate and civic leaders nationwide” for reform of K-12 education and “the importance of parental rights in these reform efforts.” (Read government funding for Christian schools) CALL opened its newest chapter in Washington D.C. in preparation for 2012 election-year campaigns and will also be opening another chapter in New York.
There are a many other groups of laity - Neocatechumenate, Focolare, Legion of Mary for example - as well as the Knights of Columbus, the Legion of Christ’s lay group, Regnum Christi, and Opus Dei, turning out large crowds in St. Peter’s Square“to cheer the pope and his policies, and they have these people all over the world.”
According to the U. S. Conference of Catholic Bishops’ website, the bishops themselves actually give no money to charity, only advice. They collect money from others and distribute it.
The U.S. Conference of Catholic Bishops (USCCB) Contributions for the Church in Latin American jumped from $625,621 in 2009 to $34.4 million in 2010 after a deal was made with Raul Castro to allow the building of a new seminary and the institution of an Church-run MBA program in business, the only one in the country.
The U.S. bishops’ subcommittee on the Church in Latin America approved over $2.1 million in grants for 86 projects to help pastoral work in 20 countries. “We are working extensively with the Church in Haiti and in Chile as they continue to address the needs resulting from the earthquakes in 2010. In Haiti, we are helping build churches, schools, and convents that are designed and built to withstand future earthquakes.” One special grant for the Catholic Church in Cuba will support evangelization efforts and the celebration of the 400th anniversary of its patron saint, Our Lady of Charity of Cobre. Other projects pastoral work in El Salvador and a social analysis project to aid pastoral work in Colombia. Funding will also go to GRAVIDA, an Argentinean network of pro-life and pro-family centers working in 21 dioceses.
According to a November 2011 study conducted by the Pew Forum on Religion and Public Life, Catholics had 41 lobbying groups in Washington D.C. “Those with over $1 million in annual advocacy expenditures included the United States Conference of Catholic Bishops ($26.67 million), American Life League ($6.67 million), Catholic Relief Services ($4.67 million), Human Life International ($3.83 million), Catholics for Choice ($2.96 million), Catholic Charities USA ($1.54 million), Catholic Family and Human Rights Institute ($1.41 million), and Center for Concern ($1.00 million). Those numbers, however, don’t reflect the lobbying done by the 200 dioceses, over 17,000 parishes, and the countless affiliated schools, agencies, organizations and media responding to the pope’s every call-to-arms.
Mercy Health, with revenue of nearly $4 billion, “could qualify as one of the largest corporations in the St. Louis region.” But due its 501(c) (3) status “pays few corporate, income, property, capital gains or sales taxes…and is exempt for federal requirements to disclose certain financial data about its operations….Mercy Health oversees a network of more than 55 tax-exempt organizations, including fundraising foundations, physician groups and hospitals in Missouri and three other states.
When Benedict was in New York in 2008, he stayed at the townhouse of Archbishop Celestino Migliori, the Vatican's man at the UN. Gifted to the church in 1975 for a token $10, the residence is now worth $17 million. He visited a synagogue where he met with Goldman Sachs boss Lloyd Blankfein, the private-equity billionaire Stephen Schwarzman and Jim Wolfensohn, a former chairman of the World Bank.
The Archdiocese of Philadelphia’s Villa St. Joseph-by-the-Sea, “the grand summer vacation home where Cardinals Krol and Bevilacqua once entertained wealthy donors will soon be up for sale. It's a three-story brick and stucco oceanfront mansion that covers an entire city block along the boardwalk in Ventnor, N.J., and is assessed at $6.2 million.”
My own analysis of the financial statements of the Archdiocese of Denver showed that the archdiocesan net assets, including the Catholic Foundation, were valued at more than $214 million in 2009, mostly in investments and only $62 million in property. From 1997 through 2009 (excluding 1999 which wasn’t published – but all to be taken with a grain of salt as unverifiable) Archbishop Chaput spent over $70 million on two seminaries since they were opened in the late 1990s.
The financial statements list "Social Development and World Peace" as an expense category which received only 8 percent of chancery (archdiocesan headquarters) spending from 1997 through 2009. Catholic Charities (CC), the only archdiocesan agency completely dedicated to helping the unfortunate, states year after year in its annual report that it receives only 3 to 4 percent of its income from the "archdiocese, parishes and other church" while 35 percent came from the government. Most people think that the Roman Catholic Church receives the bulk of its income from a percentage of parish collections forwarded to the (arch)bishop. From 1997 through 2009, only $54 million (21 percent) of $251 million in chancery income came from the parishes. For the archdiocesan entities combined, $312 million (34 percent) came from gifts. (The rest came from investment income, program fees, tuition, cemetary sales, etc.) The archbishop gave away $34 million in gifts. Some dioceses are not as wealthy as Denver; some more so. With 200 dioceses in the U.S., their numerous foundations and the USCCB also receiving millions in donations and government grants, that’s a staggering amount of money coming and going with no transparency or accountability.
A good example of how Roman Catholic money flows around the world is when the Los Angeles archdiocese had to pay a $660 million settlement to its victims of sex abuse, the Allied Irish Banks (AIB) provided a loan of $240 million in 2009.
AIB loans of up to $500 million were extended to four American dioceses in 2005-07 which had claimed bankruptcy. According to the Irish Daily Mail in 2011, the loans are being serviced and repaid “…from an unknown source.”
By chance, the bank’s former chairman is Master of the Universe, Peter Sutherland, also former chairman of BP Oil, chairman of Goldman Sachs International and the Trilateral Commission, a member of the Bilderberg Group’s steering committee, vice chairman of the European Round Table of Industrialists, adviser to at least one of Opus Dei’s business management “feeder” schools and a financial adviser to the Vatican.
A bishop cannot file for bankruptcy without permission from the Vatican. In fact, any transactions above a threshold, say $5 million, must be approved by Rome.
As noted in His Holiness, the Church fears exposure more than monetary loss. That’s why the bishops’ state-level lobbyists, the Catholic Conferences – aided by Republican legislators - have fought so hard to prevent laws which extend the statutes of limitations on sexual abuse. (It often takes children decades to come to terms with what was done to them.) The Church wants to prevent more lawsuits and, therefore, further exposure of their internal documents. And that’s also why there will probably never be another diocesan bankruptcy due to sex abuse lawsuits – because the debtors must provide the court with a list of their assets.
The best expose’ on Roman Catholic finances in America that I know of was a 2010 “Dan Rather Reports” investigation on how the Church hid and shielded assets from their victims, especially in San Diego, which was the fifth diocese to file for Chapter 11. According to Rather’s report:
The diocese owned, probably at the time , several billion dollars worth of real property. And they listed their property in the bankruptcy schedules as being worth the book value, in other words, what they paid for it. Well, the diocese has been around since the 1800′s. So, you had a building listed that was worth five million dollars, and they would list it for $150,000 which is what they paid for it originally.According to one of the bankruptcy attorneys, “These guys make Enron look like altar boys.” Pardon the pun.
But that was just the start of it. There were millions of dollars worth of properties simply missing from the official list of assets the Church had presented the court – everything from public parking lots to commercial buildings to open land….But of all these missing assets, the most notable was this 14 acre bluff-top lot, off a busy thoroughfare, with wide ocean views….
While claiming in court that it did not own the lot, the diocese was in the process of selling it to a developer for $65 million. [When found out, the diocesan attorneys claimed it was a “misunderstanding.”]
If you or I did what the Diocese of San Diego did in that bankruptcy, we’d be charged with bankruptcy fraud, and we’d probably be in prison. The whole strategy here of the Church is 1) minimize the assets, 2) get rid of the plaintiffs, and 3) most importantly, from their standpoint, deny people access to the documents that will show what we did….
The federal bankruptcy judge handling the case, Louise DeCarl Adler, hired a forensic accountant. In his report, the investigator used the word “Byzantine” to describe the accounting practices. Assets scattered across more than 900 parish bank accounts and another several hundred separate diocesan accounts. The investigator also found evidence that some parishes were deliberately trying to hide money from creditors….Rev. Gerardo Fernandez, pastor of Our Lady of Guadalupe, withdrew $40,000 from various banks and put it in a parish safe just before the diocese declared bankruptcy…Another pastor stashed nearly $300,000 in a parish safe shortly before the bankruptcy filing and another sent $70,000 to a church in Colombia.
It was only when it became clear that Judge Adler was about to throw out the bankruptcy claim that the diocese agreed to a nearly $200 million settlement with the victims.
On October 9, 2006 – the exact day before the Diocese of Davenport, Iowa, filed for Chapter 11 – the diocese went on a spending spree: $50,000 for an unnamed church in Latin America…a $20,000 payment to a seminary in Missouri, another $118,000 to another seminary in Illinois just a few weeks earlier. According to court papers, it was the first time the diocese had paid tuition to seminaries before even receiving a bill. And then there was the curious case of the pre-paid funeral. On August 16, 2006, a few weeks before the bankruptcy filing, the diocese spent almost $20,000 on the funeral for its very-much alive Bishop William Franklin….
In 2009, the Diocese of Wilmington became the last to file for Chapter 11. According to its own testimony, as of about a year ago, it has spent almost five million dollars to defend itself in these cases and it’s net worth (assets minus liabilities) was between $50 to $100 million. [The bankruptcy filing of the Spokane diocese in 2004 cost it $48 million.]
Chapter 11 was not designed to protect organizations who’ve engaged in criminal conduct, or basically, protecting criminal conduct, specifically child rape. It was designed to give companies who make bad business decisions a new start. Here, what you have is, they’re using the federal bankruptcy statutes to essentially shield themselves from liability of current victims, but worse, getting a discharge to prevent anybody who comes in later from getting any type of recovery. Anyone who believes the Catholic Church is really bankrupt needs to get a gut check and a mind check because they’re not bankrupt.
You heard all this stuff about, “This is a financial disaster, and we’re gonna have to close schools, parishes, soup kitchens – you know, people are gonna be on the street.” They settled the cases, and none of that happened. And what that’s illustrative of is they’re just not telling the truth. This is an institution that is so cash heavy, and has so much money; you couldn’t really bankrupt them if you wanted to. This is about minimizing exposure, and controlling information, nothing else.