Controversial Catholic order denies any wrongdoing over New Zealand trusts

Thursday, October 14th, 2021

New Zealand’s only Legionaries of Christ priest, Simon Cleary told CathNews that he is sorry if the media coverage has caused distress in New Zealand.

He is very concerned that New Zealand and international reporting around the Pandora Papers has painted a picture that is untrue, and while he is no longer in New Zealand he was born here and has a strong affinity to the country.

“I am truly sorry for the negative impact the trusts have created in New Zealand and especially sorry for any damage to the Church’s reputation in Aotearoa. I hope things can be resolved”, he told CathNews.

Cleary said it is simply not true that the Legionaries operate three trusts, in fact, they only operate one, the Retirement and Medical Charitable Trust (or RMCT).

The RMCT trust is receiving trust only, used to provide medical care for Legionaries and support elderly members in retirement.

Cleary told CathNews that claims the RMCT trust was established to hide money from sexual abuse settlements is simply untrue.

Cleary was forthcoming about the AlfaOmega Trust and Salus Trust.

However, says they were not established by the Legionaries of Christ but independently, by families.

Quick to clarify, Cleary said both the AlfaOmega Trust and Salus Trust, while established by private individuals, are also the family of a priest of the Congregation who wanted to donate money to Legion and where necessary provide loans so that the elderly members can be looked after and Legionnaires’ health needs promptly attended to.

These statements and others to follow, run counter to what was published in the ‘Pandora Papers’; a recently published probe by the International Consortium of Investigative Journalists (ICIJ).

“The ‘Pandora Papers’ publications have falsely attributed them to the Congregation, although the Legionaries of Christ have clarified this information to the International Consortium of Investigative Journalists”, reads a statement on the Legionaries of Christ website.

Wanting to clarify the Canon Law surrounding the priest’s actions, CathNews spoke with a Canon Lawyer who confirmed that religious may receive money and gifts, but they are not permitted to benefit from them.

In her opinion, and from what she knew of the situation no Canon Law has been broken.

Further distancing themselves from any role in the AlfaOmega and Salus trusts, the Legionaries of Christ say on its website, it has “has no knowledge of the bylaws governing the AlfaOmega Trust and the Salus Trust, which establish who their board members are because they were not created by the Legionaries of Christ.

“The Congregation has never controlled their funds, their terms, their operations, or their investments.

“Nor does the Congregation determine the destination of their funds in any way, even though the trusts were created by a Legionary priest and his family members.

In a further distancing move, the Congregation denies the media claim that all three trusts have the same directors adding that, “The RMCT trust (created by the Congregation) has a board of directors, made up of members of the Legionaries of Christ, which rotates periodically by statute, according to the positions they hold in the Congregation.”

The Pandora journalists also allege the Congregation has hidden $295 million through complex financial mechanisms such as trusts and offshore (New Zealand) accounts.

It is a claim the Legionaries also flatly refute.

What is true, they say, is Legionaries sold properties as part of their commitment to pay the debt it incurred around sexual abuse.

In another alleged serious inaccuracy, the Pandora journalists also reported that the Retirement and Medical Charitable Trust was created in 2010, only a few days before then-Pope Benedict XVI announced that the Vatican would take over the order’s management.

The implications surrounding hiding money are clear.

But, in a statement to CathNews, Cleary, said he cannot reconcile the Pandora journalists’ account with the fact that the RMCT remained inactive until it received its first funds around 2015.

Another elephant in the room is why New Zealand.

Cleary confirmed that there has never been a Legionary community based in New Zealand, saying the Legion’s outreach to New Zealand started in Dunedin only in the 1990s.

“The Legion supported and offered spiritual guidance through the Regnum Christi movement to several laypeople, and have been strong supporters and strong benefactors for the Dunedin diocese,” he said.

He said the Congregation chose New Zealand because financial environments in Mexico, where the Congregation is primarily based, and in Rome are less than transparent.

“The Legion chose New Zealand because the country is professional, reliable, cooperative and serious”.

Cleary said New Zealand always features in the top group of nations with the least corruption and the trust remains in New Zealand because the new regulations make New Zealand even more attractive.

In a statement to CathNews, the Director of Communication for Legionaries of Christ, Fr Aaron Smith, confirmed, “The RMCT has complied with applicable NZ tax regulations, international accounting laws and auditing standards.”

A 2014 review of the Legion’s finances found no irregularities. Still, the “Paradise Papers” published by ICIJ in 2017, revealed an intricate web of offshore accounts connected to the order.