July 9, 2020; Wall Street Journal
The Boy Scouts apparently could not be trusted to protect the children in its charge, but when it comes to its assets, that may be a different story.
Those suing the Boy Scouts of America (BSA) for its lack of care and its cover-up of sexual abuse have long expressed concern that the organization, which has hundreds of independently organized councils across the states, was hiding its assets with those affiliates. The affiliates and BSA insist they are legally independent, although the BSA has the power to grant or revoke their charters, among other things. Now, the litigants say they have surfaced some instances.
This is occurring as BSA has itself declared bankruptcy under Chapter 11, even as it faces 10,000 claims of sexual abuse. BSA has only $1.4 billion in assets, where local councils have an additional $1.6 billion. Some of these local councils are also being sued, but 250 of them, despite being “independent,” share the national group’s bankruptcy shield even while they have not gone bankrupt themselves.
In return for the shield, the local councils are required to let BSA know about any asset transfers, which then are to be passed along to the official survivors’ committee. But James Stang, a lawyer representing that committee, say that’s not taking place; instead, the plaintiffs are finding out about asset transfers through Google searches and news stories. Stang points to one case where the Middle Tennessee Council of the Boy Scouts transferred a property to an asset protection trust.
Richard Mason, a lawyer for a group of local councils, says the suspicions are unfounded. “With COVID-19 canceling summer camps and closing down Scout shops across the country, local councils have had to make hard decisions,” says Mason, adding that it was inappropriate for the committee of victims to judge the council’s handling of their assets.—Ruth McCambridge