A forensic accountant will be hired to review the finances of the
Archdiocese of Milwaukee as part of its bankruptcy, and survivors of
clergy sex abuse will have more time to file their claims, under an
agreement reached Wednesday before U.S. Bankruptcy Judge Susan V.
Kelley.
The
agreement, hammered out in marathon negotiating sessions that began
Friday, gives the creditors committee the go-ahead to hire
California-based Berkeley Research Group as a financial adviser.
Among
its duties will be to scrutinize church finances to determine whether
the church made fraudulent transfers as a way to shield assets from
victims of clergy sex abuse, as at least one victims attorney has
suggested.
The
archdiocese had objected, saying it was an unnecessary expense.
But
church attorneys dropped their opposition Wednesday after the creditors
committee agreed to strictly control costs and submit expenses to the
court for review.
"We have to be sensitive to the fees, we absolutely do," Kelley said.
Also
Wednesday, the parties agreed to extend the bar date, the deadline for
victims to file claims for compensation as part of the bankruptcy, to
Feb. 1, five months longer than the Sept. 15 date initially proposed by
the church. The deadline for other claimants remains unchanged.
They also
agreed on the specifics of an extensive, national advertising campaign
to alert victims to the bankruptcy and the deadline for seeking claims.
As part of the campaign, Archbishop Jerome Listecki will also ask
churches and parishes to distribute notices.
The creditors' attorneys
reserved the right to seek a later bar date if those churches and
parishes decline.
As financial
adviser, Berkeley is expected to focus on three main areas: the transfer
of $55 million into a cemetery trust, and $75 million out of parish
funds, and the creation of the Faith in our Future Fund to hold the
proceeds of a $105 million capital campaign - all since 2004, said
creditors attorney Jim Stang.
The
archdiocese has defended those moves, saying the cemetery trust merely
formalized what was always viewed as a trust; that the parish funds were
returned to their owner-congregations; and that the Faith in Our Future
Trust was created as a separate entity outside the control of the
archdiocese.
The
archdiocese filed for bankruptcy in January, saying it was the only way
to compensate victims and continue the work of the church.
It has said
it has only about $7 million in cash and properties available for
settlement; and that the vast majority of church assets, from parishes
to trusts, are legally separate and cannot be touched.