Diocese’s asset shift may be scrutinized if it files bankruptcy over sex lawsuits

BUFFALO (NY)
Buffalo News

August 5, 2019

By Jay Tokasz

A year after a bill that would suspend the civil statute of limitations in child sex abuse cases was first introduced in the New York State Legislature, the Buffalo Diocese in 2006 began moving $91 million from its main investment account into the accounts of parishes, schools, cemeteries and other Catholic entities.

Diocese officials at the time characterized the transfers as “an opportunity to increase long term investment income” and “to invest in harmony with the teachings and beliefs of the Roman Catholic Church.”

But it also was an effort to shield money in the event the bill became law and exposed the diocese to the same kinds of clergy sex abuse lawsuits that other dioceses faced, said Monsignor William J. Gallagher, a retired priest who served on the diocese’s finance council and was a longtime pastor of St. John Vianney Church in Orchard Park.

“Instead of having the diocese holding money for everybody because then it’s reachable by lawsuit, this way they created independent outfits to take care of it,” said Gallagher. “When the lawsuits started, they had to make sure that everything was separated.”

The Child Victims Act was signed into law in February, after 14 years of failing to advance to a vote in the State Senate. And now the diocese faces the prospect of dozens — and perhaps hundreds — of lawsuits this month with the opening of a one-year window in which sex abuse cases that were time-barred by statutes of limitations can proceed in civil courts.

Note: This is an Abuse Tracker excerpt. Click the title to view the full text of the original article. If the original article is no longer available, see our News Archive.