Originally published at National Catholic Register
The diocese is denying allegations that it poured tens of millions of dollars into a diocesan fund in order to avoid a payout to survivors of clergy sexual abuse.
The Diocese of Oakland is denying allegations that it 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.
A spokeswoman for the Oakland Diocese denied the claims in a comment to CNA.
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