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  Priest Pleads Guilty to Bilking Parish

By Wilson Ring
Chicago Tribune
October 30, 1991

A Catholic priest who was accused of bilking his McHenry County parish of more than $260,000 pleaded guilty Tuesday to three of seven federal charges against him in a plea-bargain agreement.

At a pretrial hearing in the Milwaukee courtroom of U.S. District Judge Robert E. Warren, Rev. William Joffe, 60, pastor of St. Joseph's Church in Harvard from 1983 to 1987, pleaded guilty to two counts of bank fraud and one count of interstate transportation of a fradulent check.

The remaining charges will be dropped as part of the deal, though Joffe must repay $27,500 to Walworth State Bank of Walworth, Wis., for money the bank lost as a result of the priest's schemes, said Assistant U.S. Atty. Susan Knepel, who prosecuted the case.

St. Joseph's gets nothing directly from the deal, Knepel said. But she said the bank has agreed to pay the Rockford Diocese, which includes St. Joseph's, the $27,500 because the bank acted improperly in allowing Joffe to operate the account.

Among other things, the priest invested in a Harvard horse farm and a Wisconsin resort and restaurant. He now faces a possible maximum penalty of up to 20 years in prison and a $750,000 fine at his sentencing, scheduled for Jan. 13.

Joffe was indicted last summer in Milwaukee on charges that he defrauded his church out of $265,882 over a five-year period.

The indictment against Joffe alleged that he opened an account in the Walworth State Bank entitled "St. Joseph's 'F' Account" and diverted large sums of church money into that account.

At least part of those funds, the indictment said, were then transferred to another private account entitled the "MCJ" account, much of which went for his own use.

Joffe's lawyer, Dianne Erickson of Milwaukee, did not return phone calls Tuesday. Joffe, who has refused all comment since his indictment, could not be reached.

Bishop Arthur O'Neill of the Rockford Diocese was out of his office Tuesday and unavailable for comment.

In early 1987, Joffe claimed a net worth of $2.7 million, though only four months later he filed for Chapter 11 bankruptcy protection. At the time of his indictment, Joffe was serving in a Florida parish.

Since then he has been living in Iowa, Knepel said.

Joffe, born in Oak Park in 1931, graduated from St. Ignatius High School in Chicago and Loras College in Dubuque, Iowa. He was ordained in 1957.

The indictment against Joffe did not say how the money was spent, but during his time in Harvard, Joffe was involved in several failed business ventures, including the Lauderdale Lakes resort in Elkhorn, Wis.

"I'm not really surprised" by his conviction, said Jerry Nolan, a Harvard barber and City Council member who also is a lifelong member of St. Joseph's.

"In some ways he didn't act like a priest. He acted like a businessman. People were surprised, for example, to learn that he had a horse farm before he got to Harvard. Priests don't do that."

In court Tuesday, Joffe admitted using some of the money he took for his failed businesses, although he also contended that some of the money was used for church expenses, Knepel said.

To some of his parishioners, Joffe appeared to be a selfless pastor who was anxious to help the less fortunate, while critics have said he was a wheeler-dealer with a taste for the finer things in life, a man who alienated many with an aggressive manner.

He had little luck with his financial ventures, records show. Efforts to run a Wisconsin resort, a restaurant and a Harvard horse farm all ended in failure.

Knepel said that during Tuesday's court appearance, Joffe answered under oath a series of questions from Judge Warren about the case against him.

Asked how the process that ended in his indictment began, Joffe answered that when he arrived in Harvard in 1983, there was a large sum of money in church accounts about which parishioners had no knowledge, Knepel said.

In order to protect the reputation of previous church personnel, he opened the "F" account, she quoted him as saying.

"Joffe indicated that if the bishop knew of the account, the bishop would not have wanted him to use it," she said.

Joffe told the court that he used some of the missing money for church expenses. Knepel said that could have been true, but an audit by the diocese showed he embezzled most of the $265,882.

"The judge made a comment that this may be just looking at the tip of the iceberg," Knepel said.

She said Warren called the case "a tragic situation."

 
 

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