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The Mightiest SupePAC of All

There is a non-profit political action group with affiliates in every state and metropolitan area which campaigns for ballot initiatives, legislation and indirectly for political candidates which can promise complete secrecy for foreign and domestic donors, uncontestable tax deductions, no restrictions on the amounts contributed with no accountability or oversight as to how their tax exempt money gets spent. Yet its lobbyists are treated with deference and respect as nonpartisan proponents of the common good although their vitriol and hyperbole against President Obama is markedly absent for those who have the worst records for executing prisoners, killing thousands of pregnant women and babies under false pretenses, implementing torture as American policy, impoverishing 99% of the population, and persecuting gays and immigrants. This is, of course, about the Roman Catholic Church and the U.S. episcopate.

Even with the witling away of regulations by the Federal Election Commission (FEC) created in 1975 to oversee financing of federal elections, secular SuperPACs are still required to disclose the names of their donors, albeit sometimes delayed until after an election, and have some restrictions on foreign nationals. Big contributors are even threatened by the IRS with owing gift taxes on their “millions of dollars in contributions to nonprofit advocacy groups which are playing an increasing role in American politics.”  And “unlike corporate and advocacy groups that lobby Congress, churches and their affiliates are exempt from the Lobby Disclosure Act of 1995, which requires lobbyists to file disclosure forms detailing their spending and naming their lobbyists.”

The Pew Forum recently named the United States Conference of Catholic Bishops (USCCB) as the second largest – in terms of dollars and behind only AIPAC – religious advocacy group in Washington D.C. Although the bishops’ organization contested the dollar amount, it did concede there were an additional 41 other lobbying groups “Catholic in their orientation” (i.e. top heavy with anti-abortion/contraception and anti-gay marriage action groups) listed separately and not included to the total. 

The Church’s real power, both financial and in influence, however, is outside the beltway. Almost every state has a Catholic Conference which lobbies for the Church on local issues. In addition, there are almost 200 (arch)diocesan offices and over 17,000 parishes in addition to schools, colleges, universities, seminaries, religious congregations, provinces and communities, all manner of media, charities, organizations such as the Knights of Columbus for men and others for women, teens and children, national associations of Catholic physicians, lawyers, educators et al, each directed by a bishop and each capable of carrying forth every political call-to-arms. And all that is required for any group to receive a religious exemption by the IRS is that it be listed in the bishop-controlled Official Catholic Directory as is the infamous Bill Donohue’s Catholic League sponsored by New York Cardinal Timothy Dolan.

Of course, each of the above can claim a legitimate religious purpose as do Catholic Foundations, separately incorporated religious non-profits which shield the funds of the diocese to which it is affiliated from lawsuits directed at priests and bishops but still under the control of the local hierarch. A couple of years ago, I reviewed the financial statements and the diocesan newspaper for information about the Catholic Foundation for the Archdiocese of Denver and the archdiocese itself. When Archbishop Charles Chaput opened the first meeting of the Foundation’s board of trustees in 1999, it was announced at the time that the Foundation had assets totaling $19.5 million “the majority of which were transferred from investments and properties held by the Archdiocese of Denver.” In less than two years, the Foundation held almost 20 percent of archdiocesan combined net assets as shown in annual reports, rose to 40 percent by 2004, and was back down to 34 percent by 2009 – or a little over $73 million of the more than $214 million in archdiocesan net assets held mostly in investments. Contrary to popular belief, in 2009 only $62 million of Denver’s net assets were in property and only $54 million (21 percent) of $251 million in chancery income from 1997-2009 came from the “people in the pew.” For the archdiocesan entities combined (schools, cemeteries, seminaries, etc.), $312 million (34 percent) came from gifts. The rest was from investment income, program fees, tuition, cemetery sales, etc.

The Foundation stated its purpose was “providing donor and endowment services” and “grantmaking,” in that order. The Foundation even offered “consulting services for professional advisers….to clients who are considering philanthropic strategies for tax or estate planning purposes. Types of advisers we work with include: tax attorneys, financial advisors, business managers, estate planners, accountants, insurance representatives and mergers-and-acquisitions specialists.” 

Chaput touted the Foundation as a means “to bring the light of Christ to the young and old, rich and poor, and to the sick, lonely and broken in our midst.” But rather than any experience in charities and non-profits, the employment backgrounds of those selected to manage the Foundation and its trustees are as founders, presidents and CEOs from the most powerful sectors of Colorado commerce: local and international mining, lumber, construction, mortgage lending, brokerage and banking, accounting and financial services, venture capitalists and investment management, communications and media, neocon foundations, property acquisition and real estate development, an international corporate attorney, a president of the International Chamber of Commerce and vice chairman of the United States Council for International Business. Some of the Foundation’s administrators and trustees also doubled as archdiocesan “consultors” deciding which companies and real estate transactions would receive investment funding from archdiocesan entities in addition to the Foundation. If you checked their names on campaignmoney.com and newsmeat.com, you would find most were heavy contributors to the Republican Party and candidates as well as providing hands-on involvement in their campaigns. The group also included the founding president and members of the Colorado chapter of Legatus, an international group of Catholic business executives who, in February 2010, presented former President George W. Bush, still with the blood on his hands of hundreds of thousands men, women and children from the Iraq War, with their “pro-life” award at a gala dinner scheduled to be attended by Cardinals Francis George and Timothy Dolan, the past and current presidents of the USCCB.  

 “Social Development and World Peace” as an archdiocesan non-itemized expense item received $5,764,804 in 2007, 2008 and 2009 combined. In the same period, Catholic Charities – the only agency in the archdiocese entirely devoted to helping “the old, poor and sick” – reported a total of $2,609,679 income from the archdiocese meaning that the definition of “Social Development and World Peace” could easily be expanded to include any politically oriented anti-abortion/contraception or anti-gay marriage group. The annual reports state the Archbishop Chaput gave away $34 million in unspecified gifts. Although some dioceses are larger, some smaller than Denver, anyway you slice it but multiplied by 200 dioceses, that’s a lot of money sloshing around especially when considering the loosey-goosey accounting practices which allowed an employee of the Philadelphia archdiocese to embezzle more than $900,000 on top of dozens of other reports about millions in Church funds gone missing. The secret stashes which never get disclosed should also be considered. In a June 2010 segment of “Dan Rather Reports” on HDNet, the video focused on how a diocese had hidden its assets and then filed for bankruptcy to avoid paying settlements to victims of sexual abuse. “One of the comments that came from one of the bankruptcy attorneys is that, ‘These guys make Enron look like altar boys.’ Pardon the pun,” said Don McLean, who was abused as a 10-year-old altar boy.

According to a May 2011 report commissioned by the USCCB, sex-abuse related settlements and programs have cost American prelates over $3 billion and concluded that the “culture” of the 1960s and 1970s was responsible for the clerical sexual abuse of children (The report was partially funded by the U.S. Department of Justice with a grant of $285,651, and the Knights of Columbus, which contributed $250,000.) Don’t be fooled that this expense has anything to do with closing urban parishes and schools (there is always enough for parishes and schools in upper class neighborhoods) or mendacious statements by cardinals that “those being served” by Catholic charities suffer as a result. Nationwide, Catholic Charities receives 67% of its funding from the government, 11% from the fees it charges the recipients of its aid, and the rest from other community based nonprofits, the United Way, from businesses such as Walmart  and only 3% from the bishops!  After making a $100 million settlement to abuse victims, the Diocese of Orange County, CA, still had $57.5 million to buy the Crystal Cathedral this year, Archbishop Charles Chaput spent over $70 million on his seminaries and Cardinal Raymond Burke spends $33,000 for one set of liturgical vestments 

Integration in an international monetary network

Each bishop, archbishop and cardinal is hand-picked by the pope and each “official” Catholic organization is tied to the pope through its approving hierarch. Also obedient to the pope are lay associations like the Knights of Columbus which, as of 2007, claimed assets of over $14 billion. Supreme Knight, Carl Anderson, former member of the Reagan administration, sits on the Board of Superintendence of the Vatican Bank or IOR (Istituto per le Opere di Religione). They are all part of a world-wide financial network run from the Vatican.

A popular misconception is that the Vatican itself is sitting on top of some huge fortune. Relative to other hordes, that’s not the case. The IOR is reported to hold only $5 billion on deposit. The art, antiquities and architectural treasures actually cost the Vatican a great deal of money to preserve. The real value comes from having been an unregulated “offshore” tax haven for Italian account holders and a clearing house for the international financial community to move clandestine funds around the globe. It was reported this week that the Vatican was included in a list of 67 Countries which could be potentially susceptible to money-laundering according to the U.S. Department of State’s annual drug-trafficking report. “To be considered a jurisdiction of concern merely indicates that there is a vulnerability to a financial system by money launderers. With the large volumes of international currency that goes through the Holy See, it is a system that makes it vulnerable as a potential money-laundering center” said Susan Pittman of the State Department’s Bureau of International Narcotics and Law Enforcement.  

The London Telegraph had reported that the Vatican Bank was the eighth most popular destination for laundered money, ahead of the Bahamas, Switzerland and Liechtenstein. The reason for this is that you cannot trace any movement of cash within the bank. “This corruption is continuing on a regular basis in the Vatican,” claimed attorney Jonathan Levy. “There’s no reason for a religion to have a bank that does worldwide commercial activities, dealing in gold, dealing in insurance, dealing in property and then hiding behind the Roman Catholic Church.”

Published in 2009, the book, Vatican SpA, focused on the cavalier attitude to financial ethics during the 1990s. Besides money coming in under the false pretenses of “charitable” purposes, whistleblower Monsignor Renardo Dardozzi noted subsidies going out to foreign cardinals as a means to move funding among churchman. But the IOR was used “especially” by politicians like Italian Prime Minister Giulio Andreotti who used the bank to pay for his defense against charges of associating with the Mafia.

The Vatican is currently in the process of proving to European regulators that is has cleaned up its act by having an internal Financial Authority and so it belongs on the “white-list” of governments who have made exemplary efforts to have financial systems not accessible to international terrorists and money launderers. It has been widely reported in the Italian press, however, that Church officials are having a hard time explaining why the Church has an offshore Cayman Islands banking division amid reports that the branch’s clients include German arms dealers and criminal elements.  Before reaching a decision, I hope these regulators check with the hundreds of thousands of sex abuse victims regarding the Catholic Church’s ability to police itself.

(Betty Clermont is author of The Neo-Catholics: Implementing Christian Nationalism in America (Clarity Press, 2009))

2 Responses

  1. Catholic Charities gets a whopping 3% of it’s funding from the bishops and 67% from the government the bishops claim is infringing on their conscience. What conscience might that be?

    Thank you for this report Betty.

    • As always, Colleen, you say it better than I do.

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