A year after Boy Scouts of America filed for bankruptcy in federal court
in the face of significant sexual abuse claims, victims continue to fight for
justice. As reported by USA Today, “Nearly 95,000 claims
were filed by the November deadline set by the bankruptcy judge.” The
charity’s reorganization plan proposes funding a $220 million trust to be used
towards compensating victims, with potentially another $300 million added in
the form of voluntary contributions from local councils. “The proposed
settlement would amount to about $6,000 per claimant, even after the total
number of claims is reduced after duplicates are deleted and other reviews,”
reports USA Today.
The amount of the charity’s assets available to pay sexual
abuse claims has been a point of disagreement between Boy Scouts of America and
claimants. According to a Complaint For Declaratory Judgment filed in the
United States Bankruptcy Court For The District of Delaware in January
2021, the charity is claiming that of its over $1 billion in alleged
assets as of November 30, 2019, over $667 million of this amount is restricted
and therefore “unavailable to satisfy creditor claims.” Attorneys for
the claimants, on the other hand, assert that the charity has failed to provide
adequate substantiation proving that most these assets are restricted.
USA Today reached out to CharityWatch Executive Director,
Laurie Styron, for insight into Boy Scouts of America’s financial structure, the value of
its assets, and the financial complexities impacting the ability of sexual
abuse victims to collect on legal claims. She provided the following
commentary:
“Laurie Styron, executive director of CharityWatch,
said fixed assets on nonprofits’ balance sheets are based on historical costs.
If the Scouts own property sold or donated to the organization many decades
ago, those values may not match current fair market value.”
“Styron said real estate valuations can be complicated
for a number of reasons, including whether easements or mineral rights are
attached or because of local and state ordinances.”
“Nonprofit organizations are often bound by restrictions in how donations can be used, experts say. For example, if a donor gives money to a program for direct aide to veterans, ‘the charity is not allowed to use it on buying new software for their website,’ Styron said.”