Diocese of Sacramento to File for Bankruptcy Amid 250 Clergy Abuse Lawsuits

In his Saturday statement, Bishop Soto asked for the faithful to join him in prayer during the bankruptcy process.

Bishop Jaime Soto.
Bishop Jaime Soto. (photo: Diocese of Sacramento)

The bishop of the Diocese of Sacramento, California, announced on Saturday that “after careful consideration and consultation” the diocese will be filing for bankruptcy amid a slate of over 250 clergy abuse lawsuits.

Sacramento Bishop Jaime Soto said in a Saturday statement that Chapter 11 bankruptcy is the “only respectful, transparent, and fair way to address the substantial number of claims” and “sustain the sanctifying, teaching, and charitable work” of the diocese.

The diocese, which has 102 parishes serving over 1 million faithful, will likely file for bankruptcy in March 2024, according to the bishop.

Bishop Soto said the decision to file for bankruptcy is part of the diocese’s “journey of atonement and renewal” in the wake of the hundreds of clergy abuses coming to light.

“I remain steadfast in my belief that I must continue to atone for the horrible sin of clergy sexual abuse,” Bishop Soto said. “The pain inflicted on [clergy abuse victims] lasts a lifetime, and so our atonement must be a lifetime commitment.”

Bishop Soto had told parishioners in a February statement that the financial challenge of the abuse lawsuits “is unlike anything we have faced before” and that he was considering “what options are available to us, should the diocese become insolvent.”  

Bishop Soto said this month that “the sickening evil” of clergy abuses of children and the failure of Church leadership to address the problems are the “sins that brought us to this place.”

Without bankruptcy, he said the diocese would likely not be able to give all the abuse survivors filing lawsuits “fair consideration of their claim.”

A question-and-answer page explaining the decision on the diocese’s website said that the intent of the bankruptcy filing is to “provide fair compensation to the greatest extent possible for all victim-survivors who have not yet had their case heard in court or reached a settlement.”

“Without such a process, diocesan funds would be exhausted by the first cases that proceed to trial, leaving nothing for the many other victim-survivors still waiting for justice,” the diocese said.

Bishop Soto clarified that “only the administrative office of the bishop [would] be seeking bankruptcy protection” and that parishes and diocesan schools will “continue their operations uninterrupted.” According to the diocese, individual parishes and schools in the diocese are considered separate legal and financial entities. 

“My coworkers and I will continue to support parishes, schools, and charitable organizations serving families and communities in need,” the bishop said, adding that while “bankruptcy is a costly and lengthy process,” it also “provides supervision and transparency for all the parties involved so that a fair resolution is offered to the victim-survivors of abuse.”

Bishop Soto has overseen the Diocese of Sacramento since 2008. CNA reported in 2019 that the Diocese of Sacramento, along with those of Los Angeles, San Francisco, San Jose, and Orange, were subpoenaed by the state of California as part of an investigation into their handling of sexual abuse allegations involving minors.

At the time Bishop Soto was vocally supportive of the investigation and said that the subpoenas “will move us toward our shared goal of ensuring that the safeguards in place for our children are working as they should.”

In his Saturday statement, Bishop Soto asked for the faithful to join him in prayer during the bankruptcy process.

The diocese also asked all parishioners to also “help by working every day to help ensure these horrible sins are not repeated” and to “make the protection of the young and vulnerable a cornerstone of who we are as people of God.”

“With God’s mercy,” the bishop said, “we will emerge from this necessary, penitential exercise with greater resolve to be a humble sanctuary of holiness and healing for all the sons and daughters of God in Northern California.”