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6.16.06
The Metropolitan Council:

What Was Said, What Wasn't

In March, after the Lesser Synod’s meeting, what was important was not what the Lesser Synod said, but what the Metropolitan did not say. Three months later, the opposite holds true. What was important at the Metropolitan Council meeting was what the Metropolitan said, and what the Metropolitan Council did not say.

• A motion was made to invite the investigative lawyers from Proskauer Rose LLP to attend a session to answer members' questions. The Metropolitan said the motion was out of order. The Council did not pursue the issue.

• The Council voted to re-open the investigation into the ADM monies that the Synod has declared “closed” in 1999 and again in 2005. The Metropolitan said he would have to consult the Holy Synod - which meets in October. The Council did not pursue the issue.

• The Council voted unanimously to hold All American Councils every three years as mandated by Statute, thus, in 2008 rather than in 2010 as announced. The Metropolitan said would have to consult the Holy Synod - which meets in October. The Council did not pursue the issue.

And so it went, for two days....

“Members” Issue A Statement

The OCA released an oddly-titled statement entitled “OCA Metropolitan Council members issue statement on finances, ongoing investigation”, on Friday, June 16th at 11:15 PM. The statement begins:

“The allegations of financial mismanagement leveled against the Church administration over the past year have provided a serious ‘wake-up’ call for the members of the Metropolitan Council of the Orthodox Church in America. Thus, we fully support the actions of His Beatitude, Metropolitan Herman, and the Holy Synod of Bishops in obtaining professional expertise to

1) determine the nature of our financial activities from a legal perspective, and 2) obtain clear and independent audits of our financial records, past and present.” (Read the entire statement here)

The Wake Up Call Began Even Before the Meeting

Several significant events took place before the meeting even began. Mrs. Dorothy Nowik of Seattle, lay representative from the Diocese of the West, abruptly resigned her Council membership in a terse six-line letter to the Metropolitan on Sunday. It read:

Your Beatitude,

After many hours of prayer and upon the advice of my Orthodox attorney, my spiritual advisor and my family, I am resigning my position on the Metropolitan Council.  Based on the two letters sent to me by the group of Orthodox attorneys from the East coast, I will not be protected by the OCA and can be held responsible for actions occurring as many as twenty years ago.  The stress of these letters and the situation of the OCA is not helping my husband’s already problematic health.  I must protect myself and my family. 

I will continue to pray for you. 

Dorothy A. Nowik

Lawyers Not Welcome

Secondly, it seems “professional advice” was not entirely welcomed by Syosset. Before the meeting, Ms. Faith Skordinski of Bethesda MD, who was elected to the Council by the last All American Council in 2005, had requested that the three attorneys from New York City who had signed legal opinion letters (Read the lawyers letters here) be invited to attend the meeting to answer Council members' questions on personal liability as they had offered. These three Orthodox lawyers were the Honorable Nicholas Palos, Support Magistrate in New York City’s Family Court; Thaddeus Wojick, a corporate lawyer at Phillips Nizer LLP (Wojick’s father is a well-known OCA priest) and James Perry, general counsel for Elizabeth Arden Inc., on whose letterhead the attorneys’ letters were sent. Fr. Paul Kucynda refused Skordinski’s request.

Not Even Proskauer Rose

In so doing, Fr. Kucynda revealed that the Proskauer Rose attorneys were not going to be present either. This directly contradicted what the delegates had been led to believe, and indeed, what the OCA itself had said, and continued to publish on its website as late as the night before the meeting. That press release read: “A report will also be received from the Proskauer Rose law firm conducting the financial investigation on behalf of The Orthodox Church in America.”

Members of the Council have confirmed that they received emails from Skordinski complaining that it was “unacceptable” for Proskauer Rose not to provide at least an interim report for the Metropolitan Council. She insisted that the Council hear directly from the investigators, at the designated time on the agenda, and if not in person, then by telephone. This option too was refused by Fr. Kucynda who explained that “due to other obligations” the lawyers would not be available.

As an explanation of the lawyers' absence, that was totally misleading. Sources have confirmed that calls and faxes were regularly received from Proskauer Rose throughout the Council sessions. If there had been any desire for Proskauer Rose to speak to the delegates, they could easily have been made available, as the work they were conducting for the OCA could easily have been rescheduled for the more pressing business of answering the Council’s questions.

What the Metropolitan Said

There may be other valid explanations, though, for Proskauer Rose not speaking with the Council at this time. It may be that Syosset had been asked by Proskauer Rose themselves to be excused so that details of the investigation were not made public before the investigation is completed. It may be Syosset had been asked by others to remain silent, for as the Metropolitan said in his opening address:

“I was made aware of the utter seriousness of such public allegations and the effect they can have on the life of not only the central administration of the Church, but on every parish enrolled as a participant in the government recognized tax exempt roster filed each year with the United States Internal Revenue Service. To the extent that we must conform to all financial regulations emanating from the federal government, to take no action is generally perceived by regulatory agencies as negligence by the leadership of the Church.”

In answer to a Council member’s direct question, later in the meeting, as to whether Syosset was currently being investigated, Fr. Kucynda said that neither he nor the Metropolitan had been personally contacted by federal officials.

Whither the Investigation?

We cannot fully know Syosset’s reasons at this time for not having Proskauer Rose speak, despite having published that they would do so. We cannot fully know why the Metropolitan ruled a subsequent motion to invite them out of order. Nor can we fully know why Fr. Kucynda resisted allowing other lawyers to be present to offer advice. What we do know is what they said:

• The Metropolitan said that the initial retainer for Proskauer Rose was $100,000; and that $80,000 had been billed.

• “Members” of the Metropolitan Council in their statement said: “No date has been set for the completion of the investigation, since it is ongoing at this time. With a significant amount of work yet to be done, the completion date for the investigation cannot be determined at this time.”

• The Metropolitan said that the reason for the delay was the continuing refusal of “ Fr. Kondratick to cooperate with the investigators.”

• Earlier the Metropolitan said in his Archpastoral Lenten Letter that he would share those results with both the Synod and the Council, and then with the entire Church.

• After all, as the Metropolitan has said repeatedly, the OCA is Proskauer Rose’s client, not any one person or persons.

What Syosset Said: What the Council Did Not Pursue

The Metropolitan began the Council meeting with an address (Read his address here). Likewise, the Acting Treasurer gave a report. (Read his report here). Given the tone of both reports, one may perhaps understand, if not sympathize, with Council members who choose to remain silent and not pursue difficult topics, rather than face withering criticism from the leadership. For example, this from Fr. Kucynda regarding the revelation of a previously unannounced $50,000 loan from Matushka Mary Buletza Breton, CPA to the

OCA:

This, however, was not the only breach of confidentiality that appears to be motivated by an effort to injure the Church and cast doubt on the credibility of those who seek to serve her. During this past week, you received an e-mail which included a number of questions posed to me in preparation for this meeting. One of the questions for the purpose of my report, I will identify as question #5. Question #5 concerns a loan of $50,000 that was offered and received at this time by my office so that current obligations of the Church could be paid. The text of Question #5 supports the conclusion that the author of the question was only able to pose their question on the basis of confidential information available to a very limited number of staff working within this building.

In Matthew 6:3 and 4, our Lord and Savior, Jesus Christ is quoted as saying, “But when you give alms, do not let your left hand know what your right hand is doing that your alms may be in secret; and your Father who sees in secret will repay you.”

The member of our Metropolitan Council who revealed the identity of a faithful member of our Orthodox Church in America, a member of the Church who wished to confer a benefit on the Church and—in keeping with Christ’s mandate—requested to remain anonymous, gave their personal agenda priority over Christ’s commandment. What could possibly justify the violation of one of the basic tenets of the Holy Scriptures and in this case, a mandate from Christ Himself?

• The Metropolitan said that he did not believe that he has to go through the Metropolitan Council to assume such a loan, even though this in direct violation of the Statute. The Council did not pursue the issue.

• Many times during the meeting documents were asked for and Fr. Kucynda said that he did not know where they were. Some documents were in his house, some were in his church office, some were in his car, and some may be in Syosset. He stated he has no central place to keep his files; no one office out of which to work. Surprised Council members asked what was wrong with the Treasurer’s office in Syosset? Fr. Kucynda said that there were all kinds of "thieves" and “spies” crawling around Syosset, that people have picked locks, broken into safes and he cannot leave anything of importance lying around.  While one member offered a solution - such as buying a new safe from Office Max - Fr. Kucynda was silent. The Council did not pursue the issue.

• At another point in the meeting, Fr. Kucynda suggested there was no legal exposure for the Metropolitan Council concerning the decades of mismanagement. When challenged by one representative who had been advised about New York State law, Fr. Kucynda quickly reversed himself. Fr. Boback, a clergy delegate elected by the All American Council, expressed some of the concerns from the attorneys’ letter, and asked about assistance from the OCA’s counsel, Russin & Vecchi LLP. Fr. Kucynda said the OCA attorneys ”may have conflicts”, and could not be used. The Council did not pursue the issue.

• The Metropolitan acknowledged there was a “Tape”, that he had viewed it some time ago, and said that it was damaging. The Council did not pursue the issue.

The Bad News

In their statement, the "Members" said: “While awaiting the full and final report from the auditor, members of the Metropolitan Council received an interim report, through which some clear trends were detected and on which we wish to comment at this time:

“1. The operating budget of The Orthodox Church in America has been in a deficit status for several years.

“2. As a result, money has been borrowed from earmarked funds to cover operating expenses.

“3. The lack of proper checks and balances on a financial administrative level has created an atmosphere inconsistent with best practices for a

non-profit corporation.

“4. The lack of an independent audit since 1999 has prevented real scrutiny and oversight of our finances and financial practices for many years. (The reports completed since 1999 are not audits, but only compilations.) “

The above bad news was delivered by William Arnold, an account representative from the firm of Lambrides, Lamos and Moulthrop. The facts were already known: the review of 2001-2005 may not be fully adequate since so many records are missing. (One payment to Fr. Kondratick’s son was found.) The 2004 audit cannot be completed, as those records are a shambles. Mr. Arnold named the persons who had received $9,500 checks made out to “cash”; including Fr. Kondratick, Matushka Bette Kondratick, Fr. Steven Strikis, OCA Comptroller, and Mrs. Arlene Kallaur, head of the Christmas Stocking Program. Fr. Stephen Strikis, the OCA comptroller, was called in for questioning about how such things could be allowed to continue for years. Neither he, nor the Metropolitan nor Fr. Kucynda had answers. The Council did not pursue the issue.

Continuing their statement, the "Members" write:

“We are determined to take the steps that are necessary to restore good order, proper financial management, and trust. They are as follows:

“1. We are taking the necessary and difficult steps to have a balanced budget. “

This may be difficult without severe cutbacks in staff and programs at Syosset. A reorganization plan is reportedly underway, and two senior staff (Frs. Fester and Brum) have accepted parish assignments. Reports were received from various Church departments. Fr. Eugene Vansuch, Executive Director of the Fellowship of Orthodox Stewards (FOS) said that donations to the special funds and appeals was significantly lower.  Fr. Vansuch stated that a few years ago FOS had over $300,000 in donations. They have approximately $67,000 in donations year to date. Significantly, most of these donations are coming with stipulations that the money has to be used for a specific purpose. 

The Metropolitan said that he would continue to raise money so that the Church could continue its mission.

The Statement continues:

“2. We are implementing the standard protocol of ‘Best Practices’ for financial management for non-profits, which is posted on the OCA web site.

3. We have approved a loan of $1.7 million to pay our creditors and to restore any and all monies borrowed from earmarked funds. This loan is being secured by the properties on Martin Drive and our headquarters in Syosset, and will be serviced out of operating funds." (Editor: The details of the loan are contained in the Treasurer’s Statement. It also lists what charities, appeals, endowments, etc. will be repaid.)

“4. We have requested that His Beatitude, Metropolitan Herman create a special financial oversight committee to work with the treasurer and administration to assess and carefully manage all current funds, and to make the necessary interim decisions to assure a balanced budget for 2006."

• The Metropolitan is considering selling the Martin Drive property, but said the Metropolitan Council will not be included in the decision-making process as to whether “it is in the best interest of the OCA for the property to be sold or not”. For the Metropolitan to sell the property without the approval of the Council would be a direct violation of the Statute. How is a “special financial oversight committee” able to dispose of property by fiat any different that the an Administrative Committee able to indebt the OCA for $240,000 at whim? The Council did not pursue the issue.

“5. We pledge to take appropriate action relative to the findings and recommendations of the auditors.

“It is our commitment to the do our best to rectify the mistakes of the past, to be fiscally responsible in the present, and to create an atmosphere of trust that will ensure confidence among the faithful of the Church in the future."

The Statement asks:

“We also ask the following from you, the faithful of the Church:

“1. That you remain patient.

“2. That you pray for us and for all concerned in these matters.

“3. That you continue to support the Church.

The statement ends with a puzzling and revealing affirmation:

“Most of us went to the Metropolitan Council meeting seeking answers to the financial and ethical questions that are facing our Church. It was also our desire to take responsibility for the duties entrusted to us by our respective dioceses and the Church at large. We also believe that you, the faithful, want and deserve the same answers, and that you want us to do all that is necessary to make things right. It is our commitment to you to do just that, and to communicate clearly with you as to how this is happening. We acknowledge your genuine love for the well-being of the Church, and we feel assured of your prayers and support.”

An Uneasy Conclusion

Most? There was no doubt that the Council meeting was often tense and often difficult. Many answers were indeed given, for which the current administration is to be commended. But even more financial and ethical questions remain unanswered, without which trust cannot be fully restored, things cannot be made right, and support is unlikely to be given. Patience and prayer are indeed virtues: but so is telling the truth, the whole truth and nothing but the truth. It would be best that these answers not be heard for the first time as hands are lifted up in the courts of law; but rather, as they are lifted up in the courts of the house of our God.

Perhaps the most revealing “snapshot” of the Council came at the end of the meeting during Ms. Faith Skordinski’s presentation: “Where Do We Go From Here?”. Working in small groups a consensus was reached: that transparency, freedom for all people to speak openly, and more detailed information from Syosset were imperative for the Church to move forward.

The Metropolitan did not participate.

- Mark Stokoe

 

 

 

 
     
 

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