Loan by Las Cruces Diocese at Issue

By Rene Romo
Abq Journal
November 18, 2012

http://www.abqjournal.com/main/2012/11/18/news/loan-by-las-cruces-diocese-at-issue.html

LAS CRUCES – Federal court records show that the cash-strapped Diocese of Las Cruces lent its former contract attorney $385,000, but the money will not be easily recovered, because the attorney died in August, and his widow filed for bankruptcy protection a short while later.

A diocese attorney, however, disputes that the religious organization lent money to its former general counsel, the late Daniel Dolan.

Instead, what the bankruptcy case filed by Dolan’s widow, Linda, “lists as a loan to Mr. Dolan appears to be a loan to an entirely separate entity that the Diocese viewed as a land investment,” diocese attorney David McNeill Jr., said in an emailed response to Journal questions.

However, in a different part of the email, McNeill wrote that the money was advanced to Dolan. He said, “That matter is still under investigation.”

McNeill added that Bishop Ricardo Ramirez “had no knowledge of that transaction until recently and did not approve it.”

The diocesan chancellor, Deacon Louis Roman, referred questions about the Dolan loans to McNeill.

But Roman did say that a budget crunch, which Bishop Ramirez discussed in the June-July issue of the diocese newsletter, was “absolutely separate” from the purported loans to the attorney.

McNeill added that the diocese is not responsible for the material contained in the pleadings filed by Dolan’s widow in the bankruptcy case: “As can happen with preliminary filings, statements made in them can be based upon incomplete information.”

Linda Dolan’s attorney, Bryan Query of Albuquerque, did not return calls seeking comment, and another attorney involved in the case said he did not know the basis of the debt listings.

According to bankruptcy court records, the Daniel Dolan estate owes the Diocese of Las Cruces $257,794 and also owes the Priest Retirement and Disability Fund $127,458.

The Dolan estate faces other legal problems. Last spring, a former client of Daniel Dolan’s filed suit in state court to recover a loan of more than $300,000 she made to the attorney.

According to court records, the Dolan estate listed liabilities of nearly $1.5 million and assets of $457,000, most of which represented the Dolan home in Las Cruces and three undeveloped lots.

Dolan, 61, died Aug. 2 in Las Cruces.

The disclosure of the purported loans in the Dolan bankruptcy case are not the first time issues involving the Las Cruces diocese’s financial management have arisen this year.

Over the summer, Ramirez, writing in the newsletter Agua Viva, disclosed that between 2004 and 2009, “unauthorized loans” totaling $1.9 million had been “appropriated” from a Parish Investment Plan for “legitimate purposes,” but without the knowledge of the bishop or the Diocesan Finance Council. The Parish Investment Plan was described as a type of savings and loan funded by parishioner donations.

Ramirez wrote that the diocese was repaying the plan for three loans for a capital campaign, medical insurance and for operations. Two audits showed no criminal activity occurred “in the transactions and diocesan funds were not illicitly used to benefit any individual.”

However, Ramirez wrote, the diocesan employee who handled the loans, reportedly without the bishop’s or Finance Council’s knowledge, had resigned. Because of the required loan repayments and investment losses caused by the economic recession, the diocese has reduced the budget of the Pastoral Center by 10 percent, imposed salary cuts and reduced some employees to part-time status.

McNeill said the financial transactions involving Dolan and diocesan funds are under investigation by church officials and “we are not at liberty to provide further information at this time.” McNeill declined to identify any individuals who may have been involved in the transactions “for privacy and legal reasons.”