Schuette Seeks Dissolution of Opus Bono Sacerdotii Charity for Lack of Governance, Diversion of Assets, and Deceptive Fundraising PracticesContact:
Andrea Bitely, Megan Hawthorne; 517-373-8060
July 19, 2018
LANSING – Michigan Attorney General Bill Schuette today filed a cease and desist order and a notice of intended action to file a civil suit against Opus Bono Sacerdotii (OBS) for violating Michigan’s Nonprofit Corporation Act and Charitable Solicitations Act. OBS is a charity based in Lapeer County that raises money nationwide to assist priests facing criminal charges and other difficulties. If OBS fails to resolve the allegations, Schuette intends to file a civil lawsuit to dissolve OBS and obtain restitution, civil penalties, and other relief.
Schuette’s Charitable Trust Section began investigating OBS in 2017, following a complaint from a former OBS employee. The investigation revealed the following:
- No board governance – From its incorporation in 2002 through the commencement of Schuette’s investigation, OBS’s board of directors failed to govern OBS activities, thereby allowing OBS President Joe Maher and Treasurer Peter Ferrara to use OBS for their personal benefit.
- No controls over expenses – OBS’s lack of governance and failure to control its assets gave OBS President Joe Maher and Treasurer Peter Ferrara the opportunity to use OBS assets for their own benefit. Maher and Ferrara routinely, and without any supervision or approval from the board, used OBS assets for meals, auto lease and expenses, travel, and other personal expenses.
- Unauthorized and Excessive Compensation – Maher and Ferrara routinely, and without authorization, withdrew or transferred OBS funds to themselves as “compensation.” During the years 2014 to 2017, this unauthorized “compensation” totaled $1.7 million. During a single 5-day period, Ferrara took more than $55,000 from OBS.
- Diversion of OBS assets – Maher’s and Ferrara’s personal use of funds and unauthorized compensation diverted OBS assets from its mission of helping priests.
- Breach of fiduciary duties – In response to the Attorney General’s investigation, rather than investigating Maher’s and Ferrara’s activities and demanding restitution, OBS directors approved Maher’s and Ferrara’s past actions.
- Deceptive Solicitations – OBS raised over a $1 million annually nationwide through deceptive mailings that fabricated quotes from priests purportedly helped by OBS to make their stories more sympathetic. OBS solicitations also spoke of an urgent need for funds to help priests; in fact, rather than using the funds raised for priests, Maher and Ferrara were using most of the funds raised for themselves.
“Active board governance is vital to the health of a charitable organization,” Schuette said. “When a board fails to do its job—fails to supervise the charity’s activities, fails to control its charitable assets, and fails to review its solicitations—it creates an opportunity for unethical or illegal conduct.”
CHARITABLE SOLICITATIONS RESOURCES
Complaints regarding charitable solicitations may be filed through the Attorney General’s online complaint form, or by mailing the Charitable Trust Section at P.O. Box 30214, Lansing, MI 48909-7714, or by emailing the Charitable Trust Section.
To assist individuals in making wise decisions regarding which charitable donations to support, Attorney General Schuette established an online searchable database for charities. The Attorney General also publishes an annual professional fundraising charitable solicitation report. Through these resources, users have access to information to aid them in determining which charities are worth supporting—and which are not. The Attorney General's Charitable Trust Section is also available at 517-373-1152 to answer inquiries about a charity.