Albany Catholic Charities' gifts to victims queried

Albany Times Union ^ | January 29, 2003 | Andrew Tilghman

[NYer]

Albany -- The Albany Catholic Charities' payment of $150,000 last year to a victim of sexual abuse by a priest was unusual and has raised questions about the agency's involvement in the sexual-abuse scandal of the past year.

Officials at the Albany Diocese and at its charitable arm have refused to discuss what role the tax-exempt organization and its $35 million annual budget have played in providing assistance to victims of sexual abuse referred from the diocese.

But last week, the charity's CEO, Sister Maureen Joyce, acknowledged that she gave one victim an untraceable bank check for $150,000 in August -- to help him to buy a house -- and said the diocese repaid the money within days from its self-insurance fund.

The agency also provided other assistance to victims, including checks for $2,000; payments for monthly medication bills; Price Chopper grocery store vouchers; and bus passes, according to interviews with victims who asked to remain anonymous.

The $150,000 payment was not intended as hush money and meant only as a way to assist a church member in need, said the Rev. Kenneth Doyle, a diocesan chancellor.

But some not-for-profit managers said the payment appeared to be inappropriate, and lawyers familiar with not-for-profit law said it could be legally questionable and outside the bounds of tax-exempt charitable activity.

"It doesn't pass the smell test," said Doug Sauer, director of the statewide Council of Community Services, an umbrella group of more than 1,000 not-for-profit groups. "You'd have a hard time saying that benefits the anti-poverty mission of the organization."

In Boston, where the nationwide sexual-abuse scandal erupted a year ago, Catholic Charities has distanced itself from the church's problems. Instead, assistance to victims is provided by the Boston Archdiocese itself, through the newly created Office of Healing Ministry, said Cullen Buckland, spokesman for Catholic Charities of the Archdiocese of Boston.

Catholic Charities of the Diocese of Albany, based at 40 North Main Ave., is a not-for-profit organization that provides social services throughout the 14-county diocese. Its board of trustees includes Bishop Howard Hubbard, priests, nuns and lay Catholics.

Joyce has said the $150,000 check was the largest single payment she was aware of that Catholic Charities made to a victim of sexual abuse. A diocesan spokesman later said Joyce could not speak publicly about her agency's role in assisting sexual abuse victims because she may be called as a witness in litigation pending in state Supreme Court in Albany.

The lawsuit the diocese pointed to focuses on a church therapist, Sister Anne Bryan Smollin, accusing her of professional malpractice for allegedly pressuring the victim who received the $150,000 payment not to hire an attorney. It is not clear what part Joyce might play in that lawsuit, which was filed in December.

Joyce did not respond to a series of questions submitted in writing by the Times Union, inquiring how many victims of sexual abuse the charity has assisted, what types of assistance it has provided and how much money the charity has spent on helping victims of sexual abuse.

David Watson, an attorney with the Council of Community Services, said the $150,000 payment probably adheres to the letter of the law, but not the spirit.

And for Catholic Charities -- a widely respected organization nationwide -- to become involved in the church's sexual-abuse scandal was simply "stupid," Watson said.

"Particularly now, why would you ever mix your name up in something like this?" he said. "Don't you have a better fiduciary obligation to the name of your corporation?"

The victim who received the $150,000 said he believed the money was intended to keep him from going public with his story of abuse in the 1970s by the Rev. David Bentley, who was removed from the ministry last year.

The man, now a 40-year-old married father, met face-to-face with Hubbard dozens of times last year but said their relationship soured when he pressed the church to help him identify other priests who he said also abused him nearly three decades ago.

When he got the payment, the victim was not asked to sign any legal papers or liability release forms, which attorneys said could have posed legal problems for Catholic Charities.

"What was the basis for the payment? If it was a settlement of litigation against someone else, I think that would be a major problem," said Edward Cohen, a Manhattan attorney who heads the New York State Bar Association's committee dealing with not-for-profit law.

Catholic Charities in Albany receives about 78 percent of its annual budget -- or $27 million -- in government grants and other public funding streams. About 8 percent -- or $3 million -- comes in donations, according to the group's annual report. Much of the money is spent on social service programs that help poor families, troubled youths, the elderly and the homeless, the report said.

In June 2002, the Albany diocese revealed it had paid out a total of $2.3 million in confidential settlements with victims of sexual abuse during the past 25 years.

The $150,000 payment last year came just months after Hubbard and church officials nationwide vowed not to enter into any more confidential settlement agreements with victims.

It was also one of several payments the victim received from the church. He got a $75,000 check from the diocesan attorney's office in May. Hubbard also agreed last year to pay him $25,000 a year for the next five years.

Church officials said they intend to announce how much assistance money is paid to victims of sexual abuse on an annual basis, with the next public disclosure coming this summer.

A spokeswoman for Catholic Charities USA in Virginia did not respond to inquiries as to whether the national network has a policy on assisting victims of abuse by priests.

Catholic Charities is certified by the U.S. Internal Revenue Service as a tax-exempt organization, meaning individuals can give money to the group and take a deduction on personal taxes. The certification, known as a 501 (C) 3, requires the group to limit use of its money to activities broadly defined by the IRS as charitable, attorneys said.

Although it is legally distinct from the Albany Diocese and serves people regardless of their faith, Catholic Charities is considered a religious organization and does not have to submit the same financial disclosure forms that secular not-for-profit groups must file with the state attorney general's office, a spokesman for the office said.

Facing a sluggish economy, many not-for-profit groups have seen a drop in contributions and a rise in demand for social services. News that charitable donations might not be going where they were ostensibly intended hurts all groups out there seeking money, Sauer said.

"Is that why people give money for Catholic Charities and take a tax deduction on it? Is that the purpose? I don't know if anyone would say yes," he said.

[NYer]

Sister Maureen Joyce, acknowledged that she gave one victim an untraceable bank check for $150,000 in August -- to help him to buy a house

This is the same victim who has been receiving free counseling (normally $50/hr) from the diocese. The therapist asked him to sign a release, pressuring him not to pursue a lawsuit!

The $150,000 payment was not intended as hush money and meant only as a way to assist a church member in need

Kudos to Andrew Tilghman and the Times Union (normally a liberal rag) for pursuing these stories and connecting the dots.