Archdiocese Spent $11 million To Keep Secrets

by Gary Snyder

The Rev. Stanley Kozlak served nearly three decades in the Archdiocese of St. Paul and Minneapolis. But then he fathered a child and the archdiocese needed him gone. Removing Kozlak quietly wouldn't be cheap, but church leaders knew how to move money discreetly. The archdiocese held two secret accounts, controlled by the archbishop, designed to make problems like Kozlak disappear. It cost over $11 million.

The efforts left the Archdiocese subject to embezzlement. The former head of accounting is accused of stealing more than $670,000 from the Archdiocese of St Paul and Minneapolis. He has pleaded guilty to theft and filing a false tax return. The perpetrator pleaded guilty to five felony counts of fraud. He is now serving a three-year prison sentence.

About 3 percent of overall archdiocese revenues in those years went for costs tied to clergy misconduct. The archdiocese is facing a slew of lawsuits over clergy misconduct that threatens to cripple it financially. The clergy misconduct budget was so well concealed that a trained eye wouldn't notice the spending.

Payments associated with clergy misconduct came from separate, secret accounts, depending on the type of behavior involved. One such account, numbered 1-515, paid costs connected to priests accused of sexually abusing children. Account 1-516, meanwhile, paid costs related to the abuse of adults, or to financial misconduct. Items with these codes included expenses for therapy costs for victims and priests.

Meanwhile, Charles Zech, director of Villanova University's Center for Church Management and Business Ethics did a study that concluded 85 percent of American dioceses had funds stolen between 2001 and 2006.

Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Charity Navigator, Vermont Public Radio, Miami Herald, National Public Radio (NPR), Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), “Betrayal”, (a movie), NBC (on Charity Fraud…TBD), FOX2, ABC Spotlight on the News, WWJ Radio, Marie Claire, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, Charity Navigator, The Chronicle of Philanthropy, St. Petersburg Times, Board Room Insider, USA Today Topics, Accountants News, Newsweek.com, Responsive Philanthropy Magazine, New York Times, Portfolio Magazine, The Virgin Islands Daily News, NANKAI (China) BUSINESS REVIEW, National Religious Broadcasters newsletter, The Charity Governance Blog, American Chronicle, Palm Beach Post, Detroit Free Press, Oakland Press, Nonprofit World, Socially Responsible Business Forum, PNNOnline, Ohio Nonprofit Resources, Nonprofit Good Practice Guide, Nonprofit Startup Guide, Nonprofit Blog, National Coalition of Homeless Newsletter, Finance and Administration Roundtable Newsletter, MichiganNonprofit.com, CORP! Magazine, Crain’s Michigan Nonprofit, ncrp.org, PhilanTopic, Nashville Free Press, Nonprofit Law Blog, Seniors World Chronicle, Carnegie Reporter, Assoc. of Certified Fraud Examiners Examiner, msnbc.com, Worchester (MA) Telegram and Gazette, Carnegie Corporation of America, EO Tax Journal, Wikipedia: Non-profit Organizations; Parent: Wise Austin, Accountants News, Veterans Today, Answers.com, Far-roundtable, #Nonprofit Report, nonprofithelpnews, nonprofit news; National Enquirer, Northwest Herald, The HelpWise Daily, The #Nonprofit Report, Wikipedia (Nonprofit Organization), Answers.com, Nonprofits: On the Brink (2006) Silence: The Impending Threat to the Charitable Sector (2011)