Catholic Dioceses That Paid Huge Sex-Abuse Settlements Managed to Get PPP Loans

Through persistent lobbying on Capitol Hill, the Church was able to bypass the 500-worker limit on the coronavirus-relief loans primarily meant for small businesses.

Jul 10 2020, 4:38pm

As small businesses around the U.S. fought to get coronavirus-relief loans, the Catholic Church, with its net worth in the billions, managed to rake in at least $1.4 billion in taxpayer-funded forgivable loans — some of which went to dioceses that have had to pay out huge settlements for clergy sex-abuse scandals.

The U.S. Roman Catholic Church and its affiliates were approved for at least 3,500 separate loans through the Paycheck Protection Program, the $659 billion fund meant to help bolster the failing economy at the start of the pandemic in the U.S. The program, handled by the U.S. Small Business Administration, was part of the $1.8 trillion CARES Act passed in March.


Records show that at least 40 dioceses involved in sex abuse scandals over the last decade were approved for a loan, according to the Associated Press. The Los Angeles diocese, for example, was approved for at least 37 loans worth between $9 million and $23 million, despite paying out as much as $660 million to settle legal disputes and pay legal fees in 2014 alone.

Some of the other egregious payouts include nearly $1 million and $1.7 million for the Archdiocese of Santa Fe and the Archdiocese of Agana in Guam, respectively, both of which sued the federal government to get their portion of the PPP loans despite filing for bankruptcy as a result of clergy abuse-related expenses, as well as 15 loans worth at least $28 million for top execs in the Archdioceses of New York.

The U.S. would typically exempt religious organizations from such loans, but Congress’s decision to let nonprofits and churches apply for loans allowed the Catholic Church to take advantage of the funds meant to help small businesses and organizations with less than 500 workers.

Through persistent lobbying on Capitol Hill and coaxing the president’s support during a group call with Catholic leaders, the Church was able to bypass the 500-worker limit on the loans.

Though the federal government has not released ranges of what each loan was worth, the AP reports that the Church was approved for anywhere between $1.4 and $3.5 billion. Many of these loans were approved early on in the application process, leaving scraps for local businesses that were supposed to benefit from the first-come, first-serve assistance program.


At least 500 of the approved loans surpassed $1 million. A total of eight applicants received the maximum amount of $5 million to $10 million.

Some of the financial burdens of the Church were brought on by coronavirus. Canceled masses worldwide stifled expected tithing revenue, while layoffs and pay cuts left families struggling to keep their kids enrolled in Catholic schools.

But before these struggles, much of the financial troubles that the church’s local branches face was the direct result of their own misdeeds. During the 2019 fiscal year alone, the church paid more than $282 million in settlements and legal expenses incurred by the on-going sex scandals taking places in its various dioceses.

The Catholic Church has not yet disclosed the exact amounts that it’s received from the federal government.

“These loans are an essential lifeline to help faith-based organizations to stay afloat and continue serving those in need during this crisis,” a spokesperson for the U.S. Conference of Catholic Bishops told the AP.

The mishandling of coronavirus relief funds is nothing new in the U.S. In May, VICE News reported at least $72 million went to big oil companies. Businesses with ties to at least four congressmen received millions even as smaller businesses failed to get their much smaller fair share.

Cover: Los Angeles Archbishop Jose H. Gomez celebrates the first English Mass with the faithful present, at the nation's largest Catholic Archdiocese in Los Angeles, Sunday, June 7, 2020. (AP Photo/Damian Dovarganes, File)


issues, Catholic Church, small business administration, CARES Act, paycheck protection program, clergy sex-abuse scandals, Catholic Bishops

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