Originally published at National Catholic Register
A bankruptcy court filing this month alleges that the Diocese of Oakland, California, poured tens of millions of dollars into a diocesan fund in order to avoid a payout to survivors of clergy sexual abuse.
A Dec. 11 filing by attorneys on behalf of a committee of abuse survivors, lodged in U.S. Bankruptcy Court, claims the diocese “perpetrated a fraudulent scheme to funnel substantial assets away from what would soon become its bankruptcy estate” into the coffers of a “non-debtor alter ego,” the Oakland Parochial Fund (OPF).
In the months leading up to its bankruptcy filings, the claim alleges, the diocese “entered into a series of synthetic management and services agreements” with the fund, after which it “transferred approximately $106 million in assets” to the fund before borrowing $35 million back from it.
Prior to those transactions, the fund “held no cash or investments and conducted no business of any kind,” the filing says.
The filing, which is heavily redacted at times, claims the money poured into the parochial fund “included approximately $92 million in cash and investments and $14 million in net loans receivable.”
The transfers were “fraudulent under California state law,” the filing alleges, claiming it is “beyond
