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Investigation into Steubenville diocese ‘financial irregularities’ still ongoing

STEUBENVILLE — Authorities still haven’t decided if the former Diocese of Steubenville employee who allegedly used several million dollars in employee payroll taxes to pay other bills will face criminal charges, Jefferson County Prosecutor Jane Hanlin said.

On Wednesday, Hanlin would say only that the allegations “remain under investigation.”

“We’re just waiting for them to do their due diligence,” Bishop Jeffrey Monforton said earlier this week.

The financial irregularities were discovered during a restructuring of the diocese’s financial offices in 2017. After examining records dating as far back as 2004, a team of independent investigators concluded money that should have been turned over to state taxing authorities and the IRS had instead been used to cover other diocesean expenses.

The individual suspected of mishandling the money also showed the bishop and finance council records portraying the diocese in the black when, in reality, it had been losing money for several years, diocese officials said.

None of the missing money ended up in any private bank accounts, spokesman Dino Orsatti said.

The diocese, however, had to pay about $3.5 million in back taxes, plus interest.

Monforton said that was a huge financial hit, forcing the diocese to liquidate unrestricted assets. He noted the payroll taxes had not been paid “from what we could ascertain, since 2003.”

He said safeguards have been put in place “so we can make sure we watch over diocese finances, pointing out the misappropriation had “a direct effect” on renovations to Holy Name Catherdral. That work has been put on indefinite hold until Monforton is convinced the diocese is in a position financially to push forward.

The cathedral, located on South Fifth Street, closed for renovations in 2014. More than $1 million had been spent on improvements, including the creation of a cul-de-sac in front of the church, and interior renovations were to have started a year ago.

Monforton said he hopes the cathedral renovations will resume, “but I’m also hesitant. It can’t be a financial burden, an albatross, to the diocese.”

“But we have a building that has not been cared for in over a decade, so something has to give,” he added.

Among the safeguards that have been instituted by the diocese: Using a third-party payroll processor, requiring two signatures on every check issued by the diocese and implementing annual independent financial audits.

Orsati said civil action to recoup damages has been delayed “due to the possible criminal action.”

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