Render Unto Rome (41 page)

That August, Joe Smith had his five-bedroom house on the market for $579,000, when Charlie Feliciano opened his newspaper to read that Smith had a new job: CFO of the Columbus diocese! Feliciano detected an old pattern: as the bishops had shuffled the pederasts, so now with the money-grubbers. Feliciano thought again,
Joe Smith must have a lot on Pilla
. Columbus bishop James Griffin “said that he had spoken to Pilla about Smith and that a Cleveland auxiliary bishop had strongly recommended Smith,” the
Columbus Dispatch
reported.
⁷³
Feliciano knew that Jimmy Quinn and Jim Griffin had been classmates in seminary and law school.

The Ernst & Young audit had satisfied the Cleveland diocese’s insurance company to pay “an unspecified damage claim,” the
Plain Dealer
reported. The insurer “then filed a claim against Smith to recoup the money.”
⁷⁴
If Smith had lied on January 6, 2004—as the Jones Day letter to AIG stated in laying out the theft-insurance claim—why did Pilla recommend the man his diocese accused of lying and theft to oversee church finances in Columbus?

Smith says he was never sued by AIG.

How did he get the Columbus job after being sacked in Cleveland?

Smith told me that Matt Brown, the Columbus diocese’s outgoing finance director and a longtime friend, arranged for him to meet with Bishop Griffin. Griffin in 2002 was the first prelate to ban the Legion of Christ and Regnum Christi from his diocese. “So I go down and talk to Griffin,” states Smith. “He says, ‘Joe, you’re probably overqualified. Tell me what happened.’ For an hour and a half I told him everything, how I wanted to leave for a better-paying job. I’d had an offer [in 1996] to
sit on the board of Blue Cross for $30,000 a year. Pilla wouldn’t allow it. John Wright wanted to keep me. He told Anton to find out how much CEOs in similar positions were making. He said to cover [the difference] in off-the-books accounts. Wright wanted it that way. When I finished, Griffin said, ‘I know Tony Pilla. You got caught up in a Tony Pilla mess.’ ”

Griffin, who is retired, refused to make any comment when I called him. But Griffin’s hiring of Smith, after the explosive media coverage, is all the more striking because
Griffin was a lawyer
. Signaling his trust in Smith
despite
the messy compensation package, Griffin obviously did not think he would get indicted.

Charlie Feliciano had another take. The diocese’s internal dynamics reminded him of the mafia. On June 5, 2005, he filed suit on behalf of thirty-seven Cleveland parishioners as plaintiffs in state court against Pilla, Smith, and Zgoznik, accusing them of defrauding the diocese, seeking $1 million in restitution, and demanding that Ohio’s attorney general conduct a full investigation of the diocese “as a charitable trust.”
⁷⁵

The court dismissed the suit on the grounds that Feliciano’s clients “must claim that they personally have a particular interest in the substance of the trust.” But, tellingly, Judge Stuart A. Friedman opined: “The Court finds that it does have jurisdiction over allegations of fiscal mismanagement, even when the alleged misconduct relates to the operation of a hierarchical church, so long as matters of faith, dogma and religious practice are not impinged.”
⁷⁶
Disappointed, Feliciano had nonetheless magnified the ties between Pilla, Zgoznik, and Smith, who was then at work in Columbus.

In January 2006 Bishop Pilla, age seventy-three, two years shy of mandatory retirement, decided to retire. “It’s time for a change,” his statement said.
⁷⁷

Sister Chris Schenk flew to Rome in late March, leading a pilgrimage of thirty-one women on a tour of ancient Christian sites. A second-century fresco in the catacomb of Saint Priscilla depicts a woman breaking bread, the Eucharist, with six other women. “We would like to talk to our leaders,” she said in an NPR interview, “and tell them of our experience—how we can begin to re-institute that wonderful balanced leadership we had in the first three centuries of both women and men leading the communities.”
⁷⁸

Still in Rome, on April 4, 2006, she heard the news: Pope Benedict had appointed Bishop Richard Lennon of Boston to take Pilla’s place. Schenk
had gotten an earful on Lennon in late February at a conference in Boston, where she met Peter Borré and others in the vigil movement. When a reporter called Borré for comment on Lennon’s new position, he blurted out, “God help the people of Cleveland.” To the best of his knowledge the quote never ran.

CHAPTER 10

PROSECUTION
AND
SUPPRESSION

For a second time, Richard Lennon assumed control of a diocese damaged by dishonest bishops, concealed sex offenders, and mismanaged money. Lennon’s mentor Cardinal Law had left financial craters, and although Archbishop Seán O’Malley was now himself a cardinal, Boston’s debt hole had grown steadily deeper. In Cleveland, Lennon found a different milieu. Despite the abuse scandal and overhanging financial questions, many people thought fondly of Pilla for his pastoral warmth and Church in the City agenda. Retired in his hometown, Bishop Pilla was still saying Masses as the FBI investigated Joe Smith, Anton Zgoznik, and the web of diocesan finances.

Despite the agonizing inner-city poverty and issues of deferred maintenance in Lennon’s new diocese, Cleveland Catholic Charities had a budget of $92 million, nearly three times Boston’s. The programs afforded a bishop access to media photo ops and events to meet donors and politicians to establish his presence. Dick Lennon was an introvert. Although he made public appearances, he typically got to his desk before dawn, toiling some nights till eleven. His formal manner was often brusque; the thick Boston accent held few hints of joy. At a meeting for clergy dialogue he spoke for nearly three hours, leaving a brief window for priests’
comments. Most priests had found Pilla warm and approachable. Lennon was cold, though he gave Cleveland his workaholic best.

Lennon arrived as a virtuous counterweight to the sleazy, unfolding narrative about church finances. On August 16, 2006, a federal grand jury indicted Anton Zgoznik and Joseph Smith (who then resigned as CFO of the Columbus diocese) on an array of counts for money laundering, mail fraud, and filing false income tax returns. A pivotal charge centered on a 1996 agreement in which Father John Wright, identified in the indictment only as “the then Financial and Legal Secretary,” agreed to pay Smith $270,000 above his salary, as a bonus for staying on the job. The bill of particulars stated:

The understanding was that the payment would be in lieu of any additional raises for the next five years, other than cost-of-living increases. ZGOZNIK participated in the arrangement by helping to urge the Financial and Legal Secretary to agree to the payment and by helping transfer the Diocese funds under the arrangement.
¹

An attorney for Wright said he had been “duped” and “unfortunately placed his trust in individuals that [
sic
] abused that trust,” reported the
Plain Dealer
. “He didn’t give Smith a raise and then say, ‘Go put it in a secret fund and don’t tell anybody about it.’ ”

Zgoznik’s companies got $17.5 million from the diocese between 1996 and 2003, prosecutors said. In return, Zgoznik paid $784,000 to companies owned by Smith. Those payments were kickbacks, prosecutors said.
²

Reading the account, Charlie Feliciano shook his head. Father Wright, who idolized Joe Smith and played golf with him and Anton, needed
urging
by Anton to embrace Joe’s sweetheart deal? Wright officiated at Anton’s wedding; he baptized his baby boy. Although Feliciano was glad to see the wheels of justice finally turn, the indictment was odd in its reliance on the passive voice. A special investments account “was set up” using the diocese’s not-for-profit tax ID. The only check signers were Joe Smith—and Father Wright.

Every indictment has a narrative strategy. Prosecutors develop a story
line for judge and jury as the investigation settles on its targets. The prosecutors choose the key witnesses, and documents, to build a case. If necessary, some witnesses get immunity. Successful testimony typically comes from people who were victims, witnessed crimes or the steps that led to crimes, or had a role in such acts and are eager to avoid prison. If Father John Wright was “duped,” why was Pilla passive about Joe Smith’s heading down the road to manage diocesan finances in Columbus after being sacked in Cleveland?

Catholic Charities and the Catholic Diocese of Cleveland Foundation issued a joint statement that funds were “being properly managed to benefit children, the elderly, people who are poor and so many other important ministries.” Financial reports were posted. The diocese announced full cooperation with the U.S. Attorney and said it was “taking steps to recover lost funds … Any suggestion that the Diocese of Cleveland or its leadership approved or knew of the conduct alleged in the indictment at issue is flatly wrong and inaccurate.”
³

LENNON’S AGENDA TAKES SHAPE

On January 30, 2007, Bishop Lennon, his spokesman, and a nun on his staff met with the FutureChurch founders Father Lou Trivison and Sister Chris Schenk, along with two of their colleagues. They wanted to strike a dialogue for preserving parishes and foster cordial ties without conflict or censure from the bishop. In Pilla’s final year, the diocese had forced FutureChurch to vacate rented space at St. Mark parish; the group moved to a storefront office in the inner-ring town of Lakewood.

Bishop Lennon listened, nodding occasionally as Sister Chris cited a national study which found that 40 percent of merged parishes lost members, while churches that stayed open with “parish directors” did better.
⁴
When she was done, Lennon noted that he’d been in Cleveland for eight months; why hadn’t he seen them before? Unsure whether it was a threat or a compliment, she took the question as rhetorical. The priest shortage, he said, was
not
the problem. “It’s all about demographics and finances.” (In Boston, with its soaring debt, he had told Father Josoma’s group it was not about money. In Cleveland, it
was.
)

Schenk and her colleague Emily Hoag pointed out that the diocese’s Vibrant Parish Life Committee had cited the priest shortage in its statement.
Lennon reiterated: the problem was
not
the priest shortage—42 percent of Cleveland’s parishes were in the red;
that
was a problem. When two priests were serving ten thousand people in the suburbs, and fourteen worked in a small radius in the city with far fewer parishioners, he had to assess the assignments. Schenk replied that urban parishes anchor neighborhoods; they could keep on with pastoral life coordinators, trained laypeople and religious sisters. Lennon gave an example of three urban parishes that agreed to merge. For that, said the bishop, “People thanked me.” In contrast, he continued, another parish had spent down its savings to $218,000. How wise was that?

Three years prior to Lennon’s arrival, the diocese had embarked on a process called Vibrant Parish Life, in which groups in small geographic areas met to assess their strengths and needs. In Boston, clustering had been the first step to closures, merged parishes, then Suppression. Like a dutiful debater, Lennon cited data, rebutting his visitors in a respectful manner that was nothing if not resolute. Schenk took comfort that he had refrained from criticizing FutureChurch for being at variance with church teaching, as Pilla had done in the swamps of scandal. Still, she couldn’t shake the impression that Lennon was rehearsing his talking points for later consumption. Sometimes, said Lennon, it took someone coming in from another place to have a fresh vision. In Boston he had closed or merged sixty-two parishes, with only a 2 percent drop in Mass attendance! Some Catholics in Boston had
thanked
him.

Not the ones I’ve spoken with
, thought Sister Chris.

Lennon ended the meeting, saying the hour they had requested was up.

Several days later the Cleveland Catholic Diocese released a financial statement. In 2006 the diocese reported revenues of $269.2 million, up $6.4 million from the preceding year. The diocese was in the black. Collection baskets had yielded $106.1 million, a 2 percent increase and “the highest since 2002 when the church first began to feel the impact of the clergy sex abuse scandal,” reported David Briggs in the
Plain Dealer
. The parochial schools, however, had a $26 million deficit. Spread across the parishes, from affluent to poor, church expenses had risen by 3.8 percent, while revenues lagged at 2.4 percent. Nevertheless, compared with Boston’s financial disaster, and the New Orleans archdiocese’s free fall after Hurricane Katrina, when 80 percent of the city flooded, Cleveland was in decent shape. Briggs scrutinized problem areas: