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Archdiocese of Milwaukee’s questionable transfers of money leading up to bankruptcy

4/12/2011 1:13:00 PM
Mike Finnegan
Yesterday the Creditors’ Committee in the Archdiocese of Milwaukee Bankruptcy proceedings asked the Court to hire a forensic accounting firm to scrutinize the Archdiocese and Archbishop Timothy Dolan’s transfer of millions of dollars in the years leading up to the bankruptcy.

The forensic accountants the Creditor’s Committee is recommending are experts in reviewing financial affairs of organizations, including transfers of money by the organization. The same forensic accountants were hired by the bankruptcy court in the Diocese of San Diego bankruptcy and prepared a report for the presiding judge that pointed out the diocese’s attempt to manipulate their finances in order to hide funds. The report upset the judge to the extent that she nearly kicked the Diocese out of Bankruptcy Court. See article about the San Diego case here.

The Archdiocese of Milwaukee made several transfers of large sums of money and also created numerous trusts right before the bankruptcy which the Creditors’ Committee believes should be scrutinized. The Archdiocese moved roughly $55 million dollars to a cemetery trust and approximately $70 million to the parishes in the years leading up to the bankruptcy. Further the Archdiocese of Milwaukee also created a number of trusts before filing for bankruptcy. Four of these trusts were created within 4 months of the Archdiocese filing for Bankruptcy. Click here for the Journal Sentinel story on this.

All of these transfers led the Creditors Committee to file the motion to hire forensic accountants to scrutinize the Archdiocese of Milwaukee’s transfers. As lawyers for many survivors of clergy abuse in the Archdiocese, we firmly believe that the top officials in the Archdiocese, including Archbishop Dolan, should be questioned about these transfers as part of the bankruptcy proceedings.