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Church May Need Loan to Pay Victims

May 5, 2002 | AP

The Archdiocese of Boston may mortgage church real estate to raise tens of millions of dollars needed for a global settlement with alleged victims of clergy sexual abuse, according to the archdiocese's chief financial officer.

Chancellor David W. Smith told the Boston Sunday Globe that it will take months to determine how much will be needed to finance such a fund.

He declined to estimate the potential size of the "non-litigious global assistance fund," saying that the archdiocese must first estimate the number of new claims and the extent of insurance coverage.

The possibility of mortgaging real estate is one scenario that has emerged since the archdiocese decided Friday to pull out of a settlement with 86 alleged abuse victims of former priest John J. Geoghan.

Cardinal Bernard Law's Finance Council refused Law's request to sign the Geoghan settlement, estimated to be worth $15 million to $30 million, saying it would leave too little money for people making future claims.

A Law adviser, whom the Globe did not name, said that the Finance Council members concluded that the settlement's $400,000 per victim would set a precedent that the archdiocese could not afford as new victims emerge.

The rejection, the first time the council has rejected one of Law's requests, stunned victims' advocates and spurred promises of legal retaliation from attorneys representing accusers.

Attorney Mitchell Garabedian, who negotiated the $15 million to $30 million settlement for 86 clients, said he will ask a judge to approve a swift deposition of Law. He also said he is exploring suing the church for breach of contract.

The agreement was reached in March after 11 months of negotiations.

On Sunday, the cardinal made his annual appeal for funds for the church with recorded messages, videotapes and written statements to members of 400 parishes.

The archdiocese has said it would not use the appeal funds to settle sexual abuse claims. Instead, the annual fund-raising drive, which raised $16 million last year, helps pay day-to-day operating expenses of about $40 million a year.

Archdiocese officials hope to raise $17.4 million this year, but some church members say they plan to withhold funds because of Law's response to the sexual abuse crisis.

The Boston archdiocese already has paid an estimated $15 million to 40 alleged Geoghan victims.

The allegations against Geoghan drew national attention to claims of sexual abuse by priests. Geoghan is serving a 9- to 10-year sentence after being convicted of molesting a 10-year-old boy.


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