Louisiana: Alexandria diocese files for bankruptcy over clergy abuse claims

The number of Roman Catholic dioceses in the US that have declared federal bankruptcy amid the worldwide church’s clergy abuse scandal has grown after one in central Louisiana recently filed for chapter 11 protection.

The diocese of Alexandria announced in a statement on Friday it had joined more than 40 Catholic institutions in the US which have filed for bankruptcy protection. According to Penn State’s law school, 28 of those bankruptcies had concluded in one of the most obvious indicators of the clergy abuse scandal’s fallout.

Alexandria’s bishop, Robert W Marshall, explained in the statement that his diocese filed for financial reorganization because of the number of clergy sexual abuse claims with which it had been faced.

“This action is occurring because some past priest-perpetrators sexually abused minors, actions that are evil, sinful and go against everything the church and the priesthood represent,” said a letter from Marshall, who has led Alexandria’s diocese since August 2020. “As a result, there are financial claims pending against the diocese that exceed our means.

“In taking this action, we have two goals. First, we want to do as much as we can, as fairly as we can, to compensate those who have been harmed. Second, we want to carry on the essential ministries of the diocese so we can continue to meet the needs of our parishes, parishioners and others who rely upon the Church for assistance.”

The Guardian reported in October 2024 the Alexandria diocese was planning to pursue bankruptcy protection, as the archdiocese of New Orleans – its fellow Louisiana institution – had done in 2020.

On Thursday, in a nearly unanimous vote, hundreds of victims of child sexual abuse by clergy in New Orleans approved a $230m bankruptcy settlement with the archdiocese there.

Though the results of the vote are not supposed to be officially announced until 6 November, the archdiocese indicated in a court filing that unofficial returns showed the settlement had been accepted by an overwhelming 99.63% of those who had voted. Opposing the settlement was a small group of bond investors who sued the archdiocese under allegations that it committed securities fraud when it withheld interest payments it had promised to investors when they bought the church’s bonded indebtedness.

The New Orleans archdiocese bankruptcy settlement also includes agreements to release files on certain abusive priests and deacons while also setting up protections for children and vulnerable adults.