Darien Case Spotlights Church Problem

By Angela Carella
The Advocate
July 17, 2006

Money goes missing from an affluent Catholic church in Fairfield County. Parish insiders suspect the pastor. They take the matter to the Diocese of Bridgeport.

The scenario describes an ongoing case at St. John's in Darien -- and one at St. Mary's in Greenwich a decade ago.

The cases are similar in that large sums of money disappeared over several years.

The cases are different because, in Darien, the parish insiders went outside the diocese for help. In Greenwich, they did not.

The FBI and U.S. attorney's office are investigating the Darien case.

Little has been said about what happened in Greenwich.

The incidents raise questions about whether Roman Catholic parishes and dioceses adequately monitor finances, and whether they are willing to report priests who take church money to law enforcement. Nationwide, there is a movement "to encourage Catholic dioceses and parishes to operate more in the open," said Francis Butler, president of Foundations and Donors Interested in Catholic Activities, a Washington, D.C., group of 45 private foundations that funds Catholic activities.

"Financial controls are a major concern. You have to have them in place or you are asking for trouble," Butler said. "Bishops endorse it as a national policy but don't always implement it on the parish level."

In December 1996, Monsignor Charles Stubbs, then pastor of St. Mary's, a wealthy parish in downtown Greenwich, retired, citing health reasons. There was a hint in the press about financial impropriety, but the diocese provided no details.

Seven months after Stubbs resigned from St. Mary's, then-Bridgeport Bishop Edward Egan, now cardinal of the Archdiocese of New York, made Stubbs assistant pastor of St. Rose of Lima Church in Newtown, according to published reports.

Two months after that, in September 1997, a complaint of sexual misconduct from the 1980s was brought against Stubbs. After Stubbs admitted molesting a boy, Egan removed him from St. Rose and defrocked him, it was reported at the time.

The question about missing money did not resurface. But, according to sources familiar with the case, Stubbs' questionable spending of church money amounted to half a million dollars. Some estimates are more than twice that. Stubbs was pastor of St. Mary's for five years.

Egan has never said what he knew about the money.

Joseph Zwilling, spokesman for the Archdiocese of New York, said the cardinal recalls little about the Stubbs matter and suggested contacting the Diocese of Bridgeport for information.

"It has been 10 years since this came up. Precise details and sequence of events people here can't be 100 percent sure of," Zwilling said. "The cardinal can't be completely sure exactly what happened, other than, when they learned of this, Stubbs was removed immediately from the parish. A new priest was appointed then and by all accounts is doing a very good job. The insurance company certainly was notified as was the policy and procedure at the time."

After Egan defrocked Stubbs, the diocese would not reveal his whereabouts. Three months ago, the Connecticut Post reported that Stubbs was living in a New York state home owned by Anthony Cernera, president of Sacred Heart University in Fairfield. Telephone messages left yesterday at the house in New York and at Cernera's home in Fairfield were not returned.

The Diocese of Bridgeport still will not discuss the Stubbs case.

Asked how much money was taken from St. Mary's, whether police were notified, whether the money was recovered and other questions, Joseph McAleer, spokesman for Bishop William Lori, said, "For the past 10 years, St. Mary Parish in Greenwich, under the leadership of Monsignor Frank Wissel, has grown and demonstrated excellent financial stewardship."

Sources familiar with the case said the money was not recovered. Greenwich police said they have no record of a complaint about money taken from St. Mary's.

In Darien, the Rev. Michael Jude Fay resigned May 17 as pastor of St. John's Church, a wealthy parish on the Post Road, after a private investigator said he found that Fay stole at least $200,000. Vito Colucci of Stamford, who was hired by another St. John's priest and the church bookkeeper, said he found that Fay spent money on purchases at luxury stores such as Tiffany and Cartier, designer clothing, upscale restaurants, limousine rides and trips.

Colucci has said the amount stolen likely is much more because he did a partial check of only two years' worth of records, and Fay was pastor of St. John's for 15 years. Many of the items Fay bought were for his lover, Clifford Martini, a Philadelphia wedding planner.

The priest who hired the private investigator, the Rev. Michael Madden, and the bookkeeper, Bethany D'Erario, have said they took financial records to the diocese April 28.

As of that date, the parish had failed to make its payments to the diocese for months, D'Erario has said. Among the payments are a 7 percent tax on weekly collections, called the cathra draticum, that parishes pay monthly to fund diocese operations.

The parish had not paid the $4,847 cathra draticum for seven months, D'Erario has said. St. John's had not made its monthly $6,943 payment for employees' medical plans for five months, and the parish was in arrears for six months on its $1,895-per-month self-insurance premiums.

"The cathra draticum is supposed to be watched closely because the diocese needs to know what its income is going to be," Butler said.

Beyond that, church payments on a small loan from People's Bank were not been made for 18 months, diocesan officials have said.

That was the case even though St. John's collects about $1 million in donations annually.

"We were week to week for as long as I've been here," said D'Erario, who has been bookkeeper for five years. "Bill collectors were calling constantly."

The parish has an accountant who sends its financial statements to Bridgeport each month, "so I assume the diocese knew the bills were not being paid," she said.

After diocesan officials were given that information and allowed Fay to remain as pastor of St. John's, she and Madden used their own money to hire Colucci.

Lori said in May that he "did not think it was the right thing to bring this thing to a private investigator."

But 10 years ago, when the diocese handled the Greenwich case internally, questions were not resolved.

"The actual characterization of Monsignor Stubbs' spending was never determined by outside forensic experts," said Tom Gallagher of Greenwich, who became a trustee at St. Mary's in January 1997, a month after Stubbs resigned, to help resolve parish finances.

If Stubbs' extraordinary spending was illegal, the diocese did not pursue it, he said.

"There was no appetite to make a claim because the insurance company would have needed a police report to verify what was taken," said Gallagher, who has worked with several Catholic organizations and was a securities lawyer on Wall Street.

It's standard procedure for an insurance company to require a police report in such cases, Butler said. But once a case goes to police, it becomes public. McAleer did not answer a question about whether the diocese sought to avoid publicity in the Stubbs case.

In the Darien case, Lori has said he learned in the fall that there were financial problems at St. John's but thought it was mismanagement. Allegations of theft arose in the spring, Lori has said, but he did not remove Fay until the day the private investigator announced that he took parish records to police.

Some say parishes nationwide should set stricter financial controls.

Most parishes have finance committees but they are only advisory; the pastor has the authority. Under Connecticut law, the officers of a parish corporation are the bishop, the diocesan vicar general, the pastor and two lay trustees he appoints. According to state laws that govern religious corporations, those five are responsible for parish matters.

St. John's parish was incorporated in 1888, according to information from the secretary of the state. The parish trustees this year are Andrew Aoyama and Robert Masi.

Gallagher said parishes are not structured to provide proper financial oversight.

"It remains a mystery to me why pastors want the incredible risk embedded in managing a parish without multiple layers of accountability and transparency," he said. "Pastoral councils and finance advisory councils are substantially meaningless. Pastors don't need to listen to such groups, if they exist at all."

The system isn't working, Gallagher said.

"We Catholics have to face the fact that the parish governance model is broken, dysfunctional and in need of dramatic reform," he said. "Without impacting dogma, there is an extraordinary number of changes that can be implemented that will empower the laity, bring accountability to parish performance and develop a robust sense of stewardship. We just need the will to design and implement such changes."

It is unclear how the 87 parishes in the Diocese of Bridgeport are monitored. Asked whether the diocese has enough employees to oversee the parishes, McAleer said Thursday, "We will have further comment upon the completion of the independent investigation of St. John Parish in Darien."

On Friday, McAleer posted on the diocesan Web site an interview with Norm Walker, chief financial officer of the diocese, in which Walker says the bishop has assembled a task force to determine how to improve financial controls at parishes.

Butler said his organization recently commissioned three polls of American Catholics that showed that two-thirds support better financial accounting in parishes. It's up to each diocese to make sure parishes manage finances properly, Butler said.

"There are not proper controls if there is one person who has too much power," he said. D'Erario and former church secretary Ellen Patafio have said that Fay repeatedly refused to turn over church credit card bills to the parish accountant, and was away so often that it was difficult for the volunteer finance committee to meet. The pastor is president of the finance committee, names the members and presides over meetings. A study by Villanova University School for Church Management showed that 39 percent of dioceses in the United States had formal fraud policies, Butler said.

"Norms have been adopted nationally to prevent fraud, and they should be in place in the parishes. But that is not the case across the country," Butler said.

Besides the Darien case, two others involving wealthy Catholic parishes have made headlines in the past two months.

In June, the Rev. Joseph Hughes was sentenced to five years in prison after pleading guilty to stealing $75,000 from Holy Cross Roman Catholic Church in Rumson, a wealthy town on the northern New Jersey shore. The Monmouth County prosecutor put the total at $2 million, saying Hughes stole it from five parish accounts over seven years.

Like Fay, Hughes lived the high life, driving a BMW and a Mercedes Benz, wearing expensive jewelry and taking exotic vacations. Hughes bought a house, a car and trips for a young man who worked as the church handyman.

In May, a New York City priest, Monsignor John Woolsey, pleaded guilty to grand larceny for stealing more than $800,000 from the Church of St. John the Martyr, a wealthy parish on Manhattan's Upper East Side. Woolsey stole donations and doctored records. In a civil suit, he is accused of swindling an elderly parishioner of half a million dollars. Woolsey spent the money on expensive watches, exclusive golf club memberships, European trips, and condos he bought in Florida and New Jersey.

Still, cases of theft are "highly unusual" among the nation's 42,000 priests, Butler said.

"The Catholic system works for the most part. There is a hierocratical structure and the bishop is the supervisor," he said. "There isn't a lot of embezzlement in the United States. It's particularly outrageous when you see it in a position of trust by a religious leader, but it is not the rule by any means. Priests as a lot are people of great integrity -- in fact, with what they do these days because there are fewer of them, they are quite heroic."

But few priests have financial training, and dioceses typically do not have enough staff to monitor the parishes, so it is "a broken system with no oversight," Gallagher said.

Better financial practices would help pastors, priests and laity do the work of the church, he said.

"Adherence to good civil law governance enables us to be better stewards of our time, talent and treasure," Gallagher said. "There's so much more we can do to improve governance. If there's not radical reform, the Darien case will become a repeated experience."


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