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Prosecutor’s office asked to look into probe of diocese

STEUBENVILLE — The Jefferson County Prosecutor’s Office is being asked to make a determination about possible criminal charges arising from an independent audit of the Catholic Diocese of Steubenville, and finances for the Holy Name Cathedral project are being investigated.

Diocesan attorney Tom Wilson said Friday, “The results of an independent investigation of the diocesan financial office has been turned over to the Jefferson County Prosecutor’s Office and they have been asked to determine whether any criminal charges should be filed. This request comes after the Ohio Attorney General’s Office instructed the diocese to allow local authorities to investigate the case.”

Bishop Jeffrey M. Monforton said he will immediately provide any additional information the prosecutor’s office might request.

The bishop said he also has instructed the audit firm it hired to investigate the diocesan finances, Schneider Downs, and the Bodman law firm of Troy, Mich., which was hired to handle the independent financial investigation and diocesan employees to cooperate fully.

The diocese issued a statement Friday saying the bishop believes justice will be served and parishioners “will get the answers they deserve as to what has been going on in the finance office.”

The bishop said, “I am disappointed this process has taken so long. This is the first time the diocese has had to engage in such an extensive investigation.”

Jefferson County Prosecutor Jane Hanlin said Friday she had a preliminary meeting with Wilson.

“We have received some preliminary information. We do not have all the files yet, but we will start to take a look,” she said.

The bishop received the preliminary report from Schneider Downs in May.

He said then it showed “various federal, state and local payroll taxes were withheld from employees’ checks from 2004 through 2016, but the former comptroller did not send the money to the appropriate taxing authorities.”

The former comptroller was Dave Franklin, whom the diocese said previously could be facing legal action. The diocese also said previously that its previous vicar general had not exercised appropriate administrative oversight of the finance office. Monsignor Kurt Kemo stepped down from the vicar general’s post in February, for health reasons, the diocese said. He was replaced by Rev. James Dunfee.

The diocese said it paid $3.5 million, which included accrued interest, to proper taxing authorities through the liquidation of unrestricted diocesan assets.

The diocese has not stated which assets were liquidated to pay the tax bill. Officials initially indicated the Holy Name Cathedral renovation project was not involved. The diocese said in its statement Friday the Columbus branch of Schneider Downs is conducting a forensic audit on the project.

The audit goes back to the initial “Lift High the Cross Campaign” to raise money for the Cathedral, dating back more than a decade.

Monforton said he would reveal the results as soon as he gets that report.

The diocese continues to take steps to be sure the financial irregularities don’t happen again.

Chief Financial Officer Patrick Henry has implemented new financial controls and an independent audit will be performed annually. It was after Henry was hired last fall that the irregularities surfaced.

Monforton said, “To reiterate, as shepherd of the diocese, I take responsibility for actions that have occurred in the finance office. I am confident that the new measures and internal controls we have adopted have fully resolved the situation and will assure that these irregularities do not occur in the future.”

The diocese had spent more than $1 million on infrastructure for the cathedral, including the creation of a cul-de-sac in front of the church. Interior renovations were to have started during the past winter.

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