Financial reorganization led to the purchase of the hospital and its affiliates through a partnership between the Congregation of the Sons of the Immaculate Conception and the Vatican Secretariat of State. This partnership owns and operates the IDI hospital and its affiliates through the non-profit Fondazione Luigi Maria Monti and a limited liability subsidiary, Luigi Maria Monti, S.r.l.
At the Papal Foundation's December 2017 meeting that approved the grant, O'Brien charged, Wuerl made two false statements recorded in the meeting minutes: he wrongly claimed that the religious congregation involved in the hospital during the time of fraud, embezzlement and insolvency was no longer involved; and he understated the debt of the hospital and its affiliates after April 2015 insolvency proceedings.
Corallo, a Papal Foundation spokesman, said there were "a variety of interpretations" of the financial condition of the IDI and its sponsoring entities. The relationship of the religious congregation and the IDI was "still unclear," he said, and all discussion was made difficult by "conflicting interpretations." Wuerl's December 2017 presentation used both publicly available information and information "provided by the Holy See."
"Other interpretations were also offered," said Corallo.
O'Brien countered that much information, including the $60 million debt and the continued involvement of the Sons of the Immaculate Conception, were available publicly. He argued that Wuerl "does not appear to have taken any steps to clarify the crucial information about the supposed beneficiary of the $25 million grant."
Wuerl told the board that the IDI group owed $26 million in payables but did not mention a $60 million mortgage debt, O'Brien said. He added that Wuerl resisted lay board members' requests for financial statements from the hospital.
McCarrick, Wuerl's predecessor as Archbishop of Washington, at the time was an ex officio member of the foundation board.
O'Brien said Wuerl knew that McCarrick could win leniency in the Vatican's treatment of his sex abuse case if he were able to secure the grant for the hospital, at the request of the Vatican Secretary of State.
Wuerl also failed to disclose that a Vatican dicastery for which he is a board member, the Administration of the Patrimony of the Holy See (APSA), is apparently a creditor of the troubled IDI, O'Brien said. The APSA lent 50 million euros to the IDI as part of its reorganization.
O'Brien said it is still unknown whether the first part of the grant, worth $13 million, was delivered to the Fondazione Luigi Maria Monti. According to O'Brien, the Papal Foundation has not said whether it has sent the final part of the grant.
Cardinal Wuerl in a Jan. 19, 2018 letter asked the Holy See to decline about half the grant. In February 2018, a Papal Foundation spokesman told the National Catholic Register it is not the foundation's practice to comment on individual grant requests.
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The Papal Foundation was launched in 1988 by Cardinal John Krol of Philadelphia, Cardinal John O'Connor of New York and then-Archbishop of Newark Theodore McCarrick. McCarrick would go on to become a cardinal and Archbishop of Washington and also president of the foundation.
The revelations that McCarrick had sexually abused minors and seminarians would lead to his resignation from the College of Cardinals and removal from the clerical state. The revelations would lead to many questions about his influence as a global diplomat and fundraiser and whether his abuse was known and covered up by prominent churchmen.
In a September 28, 2018 essay at First Things, O'Brien had criticized McCarrick's "manifest and gross conflict of interest" because he stood to benefit personally if, by securing the grant, "he could win leniency in how [the Vatican] handled his sex abuse case." O'Brien argued that under Pennsylvania law which governs the Papal Foundation, directors of non-profits are obliged to disclose material conflicts of interest to the organization's directors and officers, and recuse themselves from relevant board decisions.
O'Brien said foundation board members had told him that foundation grants had been audited in 2015 or 2016, finding a lack of records for many grants and other records indicating poor oversight on the part of the grant recipients or middlemen, who were sometimes papal nuncios.
A spokesman for the papal foundation, cited in O'Brien's September 2018 essay, said it is making "every effort" to ensure grants are acknowledged and reported. He said the foundation is audited annually and it has been confirmed that the foundation's procedures and operations are consistent with its bylaws and mission. At the same time, O'Brien cited a December 2017 letter from the foundation's attorneys noting an apparent failure to confirm that grant recipients operated in a way analogous to U.S. charities and an apparent failure to obtain meaningful audits or accountings of how the grants were spent.
In March 2018 the foundation said its executive committee and board made an inadequate effort to address and correct what it said was "anonymous, inaccurate and misleading information related to the grant request" as well as "unsubstantiated claims that called into question the integrity of the request by the Holy See and of members of the board."