Diocese, Kilmartin’s Legal Delays Are Increasing Costs to Recover Monies For St. Joseph Pension
Friday, December 01, 2017
The St. Joseph pension fund collapsed in August and the effort to recover funds is getting more and more expensive due to the legal actions by the Diocese of Providence and Attorney General Peter Kilmartin, according to new information uncovered by GoLocal and confirmed by receiver Attorney Stephen Del Sesto.
From the date of the fund being thrust into a receivership until October 31, legal costs have hit nearly $250,000 and the pace in the just-completed month of November was even higher.
Much of the effort of the past two months has been in seeking information from the Diocese and Kilmartin and then forcing them to adhere to the court authorized subpoenas.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST“Time is not my friend or the friend of the pension holders devastated by this situation. Every person or party that I am seeking documents and information from should make every effort to produce those documents in full and as quickly as is possible,” said Del Sesto.
Neither Kilmartin nor the Diocese’s attorney Eugene Bernardo, Jr. responded to requests for comment.
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Judge Brian Stern seemed stunned at a hearing on Tuesday in Superior Court, when he was alerted by members of the Attorney General’s office that despite receiving a subpoena on November 3, Kilmartin had not complied with any part of the order and had not provided a single document.
“Clearly, these delays cost real time, energy, and money that has had to be dedicated to the effort to get the Attorney General and the Diocese to provide information — it is a significant expenditure of time and money,” said special investigator, attorney Max Wistow.
The impact to the recovery process has cost retirees months, at a time when retirees are facing a potential 40 percent cut to their pension payments on February 1, 2018 — just two months away.
“The AG has stated publicly that the pension holders deserve to know what happened and that he wants the Court [and me] to proceed quickly and transparently. The Bishop has stated publicly how tragic this situation is for the pension holders and he hopes that this is resolved as quickly as possible for them. I couldn’t agree with them more and I expect and require the same diligence from the AG, the Diocese and any other parties with information about this pension plan,” said Del Sesto.
Wistow has been forced to spend an inordinate amount of time forcing Kilmartin and the Diocese to comply with the subpoenas. On Tuesday, Judge Stern ordered Kilmartin to comply with the subpoena, set forth a process for disputed documents and a drop-dead due date for all documents by January 15, 2018 - just two weeks before retirees face dramatic cuts to their pensions.
Moreover, the legal wrangling and delays by Kilmartin have forced the documents to be delivered two months after the subpoena-ordered delivery of the documents.
Kilmartin’s strategy has successfully driven up costs and delayed the delivery of key documents by two months.
Key Resources Being Depleted
Del Sesto, Wistow and all the associated costs of the receivership are paid by the old Saint Joseph company, or “Old Co,” that was the corporate holding company for the hospital. Those resources are both critical and limited as they are some of the potential funds that could be dedicated to make pension plan participants whole.
“I have been told St. Joseph holds approximately $1.5 million in (cash and investments) and [the old] Roger Williams Hospital holds approximately $4 to $5 million (cash and investments). At my request, the Estate did receive and is holding $650,000 from Roger Williams. These funds will be used to pay the Court approved fees, costs, and expenses,” said Del Sesto.
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