Audit finds diocese mishandled bankruptcy funds
SAN DIEGO (AP) A handful of parishes in the Roman Catholic Diocese of San Diego deliberately concealed or inappropriately handled about $500,000 in funds in sometimes "purposeful attempts" to circumvent federal bankruptcy proceedings, according to an auditor's report.
The San Diego diocese filed for Chapter 11 bankruptcy on February 27, just hours before going to trial in more than 140 lawsuits alleging sexual abuse by priests.
The filing automatically halted court proceedings in the lawsuits.
Church finances, specifically the question of how much the diocese is worth, has been hotly contested since the bankruptcy petition, which came after four years of unsuccessful settlement negotiations.
The "openly questionable activities" appear to be limited to a small number of parishes, and most pastors and lay personnel demonstrate a good faith effort to comply with church financial procedures, the report said.
Still, the 175-page report published late on Monday found no overall system of accounting throughout the diocese.
"As a result (church officials) are often woefully unaware of the specific financial operations of individual parishes," the report said.
With nearly 1 million Catholics and holdings throughout San Diego County, the diocese here is by far the largest and, by all accounts, the wealthiest of the five US dioceses to have filed for Chapter 11 bankruptcy protection under the shadow of civil claims over sexual abuse.
