The Catholic Church has turned to widespread claims of bankruptcy to avoid massive financial loss and publicity through child sexual abuse lawsuits.

Over the past 40 years, the rapid increase in claims against paedophile priests has rocked the Catholic Church. As more and more victims turned to compensation lawyers to help achieve justice, and receive payment for emotional and physical injuries they sustained, the church began implementing business tactics to protect its assets.

In the late 1980s and 1990s, victims of child sexual abuse began to file civil lawsuits against the individual dioceses where the alleged incidents took place. The move began a chain of events that slowly began to expose the extensive, longterm systemic cover-ups from the church of sexual abuse at the hands of priests from around the world.

According to, a nonprofit that tracks clergy sex abuse, the catholic church paid around $750 million from the early ’80s through 2002 in compensation to victims. Many of these settlements were made out of court with strict non-disclosure agreements with the help of experienced compensation lawyers.

Compensation lawyers fight against bankruptcy tactics

In the US new laws in many states, called Window Statutes, have changed the maximum amount of time between an alleged abuse and when a lawsuit could be filed. Since the laws have been introducing many churches facing lawsuits have embraced a new bankruptcy strategy to limit the amount compensation lawyers can pursue in behalf of their clients.

The strategy is widely used by large corporations to minimise the financial impact of being sued. For the strategy to work the church begins by first reclassifying and transferring assets from the diocese being sued into other areas and trusts under the church, and into different parishes. The individual diocese being sued then claims bankruptcy, limiting value of the estate that is then divided equally amongst victims.

The result is devastating for the victims who are denied their rightful compensation and reparations, with the estimated cost of ongoing psychological support for a victim of child sex abuse reported reaching over $250,000US.

According to compensation lawyers fighting for victims in the US, the Vatican directs the dioceses in their positions regarding settlements as well as their financial reorganisation.

According to a review of court filings by lawyers for churches and victims in the US over the past 15 years conducted by Bloomberg Businessweek, the U.S Catholic Church has shielded more than $2 billion USD in assets from victims using bankruptcy methods.

While these reports are focussed on the US similar tactics are used across the globe to limit the compensation victims of sexual abuse at the hands of paedophile priests can claim from their parish and the Church.

If you have been subject to abuse and would like to seek damages talk to our team immediately. Our compensation lawyers are experts in this field and can help you find contact our team immediately on 1300 727 266 or Contact Us.

Marocchi Law are Australia’s leading experts in this area of the law and will make sure you receive the full compensation you are entitled to.

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