Michigan AG seeks to dissolve priest-assistance charity over lack of governance

Lansing, Mich., Jul 20, 2018 / 04:58 pm (CNA/EWTN News).- The Michigan attorney general filed Thursday a cease and desist order against Opus Bono Sacerdotii, a charity which raises money to assist priests facing difficulties, citing a lack of oversight and other violations of state law.

The attorney general, Bill Schuette, filed a notice of intended action July 19.

“Before bringing a civil action, the Attorney General will consider accepting an assurance of discontinuance or other appropriate settlement agreement,” the notice stated.

A former employee of Opus Bono Sacerdotii complained to Schuette’s office in February 2017, “claiming that the charity was violating its nonprofit status and was being used for the personal benefit of its officers Joe Maher and Peter Ferrara.”

On reviewing tax forms, the attorney general’s office “found irregularities and lack of details that lent support to the complaint,” and differing lists of board members, which led to an investigation which lasted until at least May 2018.

The investigation found a lack of board governance, no controls over expenses, unauthorized and excessive compensation, diversion of assets, breach of fiduciary duties, and deceptive solicitations.

“OBS President Joe Maher and Treasurer Peter Ferrara operated OBS without any meaningful oversight from its board of directors,” according to the attorney general’s filing.

The OBS board did not hold formal board meetings, and when they did, minutes were not kept.

Maher and Ferrara are two of the six members of the board of directors; another member, Fr. Eduard Perrone, said, “he never viewed himself as a director and had no knowledge of Opus Bono’s organizational structure; he considered himself a spiritual adviser to the group”. Paul Barron, another board member, said that “the board did not supervise Maher’s and Ferrara’s activities and that the annual meetings were informal,” the attorney general reported.

This lack of governance allowed the “possible diversion and illicit use” of OSB’s charitable assets by Maher and Ferrara, the attorney general wrote. “The pattern of OBS expenses, transfers, and withdrawals suggest regular personal benefit to Maher and Ferrara from OBS assets.”

Neither of the men had a compensation agreement with OBS: “Neither Maher nor Ferrara were paid in regular amounts at regular intervals. Instead, without authorization, at their discretion, both Maher and Ferrara withdrew and transferred OBS assets to themselves or expended them for their own personal benefit.”

The attorney general also stated that “Maher’s and Ferrara’s personal use of funds and unauthorized compensation diverted OBS assets from its mission of helping priests.”

After the investigation began, OBS held a board meeting in which it had “a fiduciary duty to preserve OBS assets and to itself investigate OBS’s finances to ensure that OBS assets were being used—and had been used in the past—as intended,” according to Schuette.

“Instead of investigating and recovering personal expenses charged by Maher and Ferrara and excessive compensation taken by Maher and Ferrara, OBS’s board passed a resolution purporting to authorize Maher’s and Ferrara’s past actions, including tens of thousands of possible personal expenses for meals, auto, and travel … In so doing, the OBS board breached its fiduciary duties to OBS.”

Finally, the investigation found that solicitations for donations sent by OBS “generally told donors that Maher just received a letter from a priest that OBS had helped; the mailing then included a lengthy direct quote purportedly from the priest telling his story.”

“But OBS has admitted that the letters were not direct quotes and were a ‘composition of multiple letters.’”

The attorney general instructed OBS to cease “all unlawful solicitations as described in the above violations and all unauthorized or excessive compensation or personal expenses,” and said that violation “may result in a civil action for restitution, civil fines, litigation costs, and injunctive relief.”

OBS was founded in 2002 to “facilitate care for Catholic priests who are experiencing difficulties in their personal life and priestly ministry,” the organization states. “A vital component of this urgent care is in providing monies to priests who are in dire need of the basic necessities of life, especially when they have no other available options for financial support.”

The charitable tax-exempt organization bears a “2017 Top-Rated” logo from GreatNonprofits on its website.


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