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By Colette M. Jenkins
Beacon Journal religion writer
POSTED: 08:00 p.m. EST, Feb 24, 2009
The Catholic Diocese of Cleveland announced Tuesday that a financial-misconduct hot line has been established to report any concerns about suspected financial wrongdoing.
''Anyone who suspects financial irregularities on a diocesan level or a parish level can report their concerns and they can do it anonymously, if they want,'' said Robert Tayek, spokesman for the diocese. ''A third party will investigate all reports.''
The program is operated by an independent company, called EthicsPoint Inc., based in Portland. The company, founded in 1999 by a group of certified fraud examiners, provides online reporting systems to more than 2,000 clients in 300 industries (including health care, banking, retail, education and nonprofit).
The archdioceses of Chicago and Milwaukee have used the system for about a year and the Archdiocese of Cincinnati recently implemented it, Tayek said. The system is used for reporting embezzlement or theft; falsification of contracts, reports or records; conflicts of interest; donor stewardship issues; disclosure of confidential information and accounting and auditing matters.
The decision to utilize the system in Cleveland was, in part, based on the tax-fraud convictions of the diocese's former chief legal and financial officer, Joseph Smith, and former diocesan accountant Anton Zgoznik.
According to the evidence presented in the Cleveland federal court, Smith directed $17.5 million in church business to Zgoznik between 1997 and 2003. Zgoznik then made payments, characterized as kickbacks, to two companies owned by Smith.
The diocese received letters in January 2004 from an anonymous tipster about the alleged misconduct.
Smith was convicted in August 2008, after a six-week trial, on one count of conspiracy to defraud the United States and IRS, four counts of filing false tax returns and one count of corruptly endeavoring to impede the IRS. He was sentenced in December to a year and a day in prison.
Zgoznik was convicted in October 2007 of conspiracy to commit mail fraud, eight counts of mail fraud, one count of conspiracy to defraud the IRS, one count of corruptly trying to obstruct, one count of aiding preparation of a false document and three counts of aiding preparation of a false tax return. Zgoznik's request for a new trial is pending.
''The fraud committed by Joseph Smith and Anton Zgoznik was an element that caused the diocese to look into this safeguard,'' Tayek said. ''But this is also a way for us to be more financially transparent and accountable.''
Suspected financial misconduct in the local diocese can be reported by calling the hotline at 1-888-235-1723 or by going to http://www.dioceseofcleveland.org and clicking on the ''financial misconduct'' link. Calls will be handled by trained specialists, and the reporter can leave a name or remain anonymous in a guaranteed secure environment.
The new reporting system was introduced in conjunction with the release of the diocese's annual review, Report to the Community 2008.
The report includes information on the finances, activities and programs of the diocese. According to the report, 2008 revenue was significantly lower ($5.1 million) than 2007. John Maimone, finance officer for the diocese, attributes the decrease to investment market performance.
The economic downturn and market fluctuation placed 42 percent of the diocese's parishes with expenses greater than revenues, compared to 30 percent in 2007. Diocesan parishes and schools served more than 750,000 people, according to the report. Offerings, however, increased by 2 percent, or $2.2 million.
Catholic Charities, the largest diocesan system of social services in the world, served 2.8 million meals and provided more than 65,000 nights of shelter.
Other financial details can be found at http://www.dioceseofcleveland.org by clicking on ''Diocesan Finances.''
Colette Jenkins can be reached at 330-996-3731 or cjenkins@thebeaconjournal.com.
The Catholic Diocese of Cleveland announced Tuesday that a financial-misconduct hot line has been established to report any concerns about suspected financial wrongdoing.
''Anyone who suspects financial irregularities on a diocesan level or a parish level can report their concerns and they can do it anonymously, if they want,'' said Robert Tayek, spokesman for the diocese. ''A third party will investigate all reports.''
The program is operated by an independent company, called EthicsPoint Inc., based in Portland. The company, founded in 1999 by a group of certified fraud examiners, provides online reporting systems to more than 2,000 clients in 300 industries (including health care, banking, retail, education and nonprofit).
The archdioceses of Chicago and Milwaukee have used the system for about a year and the Archdiocese of Cincinnati recently implemented it, Tayek said. The system is used for reporting embezzlement or theft; falsification of contracts, reports or records; conflicts of interest; donor stewardship issues; disclosure of confidential information and accounting and auditing matters.
The decision to utilize the system in Cleveland was, in part, based on the tax-fraud convictions of the diocese's former chief legal and financial officer, Joseph Smith, and former diocesan accountant Anton Zgoznik.
According to the evidence presented in the Cleveland federal court, Smith directed $17.5 million in church business to Zgoznik between 1997 and 2003. Zgoznik then made payments, characterized as kickbacks, to two companies owned by Smith.
The diocese received letters in January 2004 from an anonymous tipster about the alleged misconduct.
Smith was convicted in August 2008, after a six-week trial, on one count of conspiracy to defraud the United States and IRS, four counts of filing false tax returns and one count of corruptly endeavoring to impede the IRS. He was sentenced in December to a year and a day in prison.
Zgoznik was convicted in October 2007 of conspiracy to commit mail fraud, eight counts of mail fraud, one count of conspiracy to defraud the IRS, one count of corruptly trying to obstruct, one count of aiding preparation of a false document and three counts of aiding preparation of a false tax return. Zgoznik's request for a new trial is pending.
''The fraud committed by Joseph Smith and Anton Zgoznik was an element that caused the diocese to look into this safeguard,'' Tayek said. ''But this is also a way for us to be more financially transparent and accountable.''
Suspected financial misconduct in the local diocese can be reported by calling the hotline at 1-888-235-1723 or by going to http://www.dioceseofcleveland.org and clicking on the ''financial misconduct'' link. Calls will be handled by trained specialists, and the reporter can leave a name or remain anonymous in a guaranteed secure environment.
The new reporting system was introduced in conjunction with the release of the diocese's annual review, Report to the Community 2008.
The report includes information on the finances, activities and programs of the diocese. According to the report, 2008 revenue was significantly lower ($5.1 million) than 2007. John Maimone, finance officer for the diocese, attributes the decrease to investment market performance.
The economic downturn and market fluctuation placed 42 percent of the diocese's parishes with expenses greater than revenues, compared to 30 percent in 2007. Diocesan parishes and schools served more than 750,000 people, according to the report. Offerings, however, increased by 2 percent, or $2.2 million.
Catholic Charities, the largest diocesan system of social services in the world, served 2.8 million meals and provided more than 65,000 nights of shelter.
Other financial details can be found at http://www.dioceseofcleveland.org by clicking on ''Diocesan Finances.''
Colette Jenkins can be reached at 330-996-3731 or cjenkins@thebeaconjournal.com.
Comments
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rootstown, oh
Posted 05:31 PM, 02/26/2009
how about a "i was molested by a priest" hotline?
