Catholic Diocese of Sacramento could become insolvent over sexual abuse lawsuits, bishop says

KXTV - ABC 10 [Sacramento CA]

February 28, 2023

Bishop Jaime Soto says the diocese is committed to resolving the more than 200 lawsuits alleging sexual abuse and warns it could cause the diocese to go bankrupt.

Catholic Diocese of Sacramento Bishop Jaime Soto is warning the diocese’s finances may be overwhelmed by the number of sexual abuse lawsuits it’s facing.

Soto posted the announcement Sunday with a video message ahead of an article in the March/April issue of Catholic Herald magazine about how the diocese is working to create safe spaces and atone for clergy sexual abuse.

In his announcement, Soto says there are more than 200 lawsuits against the diocese alleging sexual abuse of minors due to California law extending the statute of limitations (AB 218).

A judge of the Alameda County Court is overseeing a special proceeding regarding the claims in Sacramento and other dioceses in the region. Soto says he’s committing to resolving the claims, but the quantity could cause the diocese to become insolvent.

“I regret that this information will be a source of disappointment and anxiety for the Faithful. Although there is much that we do not yet know about the process for resolving these claims, I hope we will be able to answer at least some of the initial questions you may have,” wrote Soto.

The diocese also published a Q&A detailing the process and what it could mean.

The article says the diocese will pay for the claims from funds set aside for that purpose, however, the current funds and insurance coverage may not cover the new claims in which case the diocese could go bankrupt.

The article says they expect parishes and school corporations to be “largely unaffected” if the diocese files for bankruptcy.

Soto expects to know more about the financial situation of the diocese by the summer as proceedings continue into the mediation process.