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3.20.06

New Details, Reactions Concerning the Dismissal
Proskauer Rose to Represent OCA

in Investigation

Sources have confirmed to OCANews that Proskauer Rose LLP, the New York law firm retained by the Primate of the Church, Metropolitan Herman, to undertake an internal investigation of all allegations relating to the finances of the Church, will be acting on behalf of the OCA in the matter, not the Metropolitan personally.

The legal distinction is crucial to the public credibility of the current investigation. In response to earlier calls for an investigation, in 1999, former Metropolitan Theodosius would only agree to a 'summary review' of certain accounts, and OCA legal Counsel, Russin & Vecchi LLP, was to hire the CPA firm chosen to do the review, so that the results would be shielded by attorney-client privilege.This does not appear to be Metropolitan Herman's intent in this full investigation.

Proskauer Rose is one of the world's largest law firms, and has a selective client list that includes giants in the entertainment industry (CBS, HBO), the sports world (NBA, NHL) and financial industries (Deutsche Bank, Citigroup, Merrill Lynch). According to its website at ProskauerRose.com, it is the 'Criminal Defense and Corporate Investigations Practice Group' which represents individuals and corporate clients in internal organizational investigations and criminal proceedings.

The website makes for interesting reading for those seeking a greater understanding of what is involved in an internal corporate investigation. Proskauer Rose writes: "Severe enforcement consequences exist where the line separating civil and regulatory infractions from criminal offenses is frequently blurred. And when this vague line of demarcation is coupled with a broader application of the concepts of 'willful blindness' and 'reckless disregard', the present enforcement climate transfers to clients the burden of demonstrating compliance, rather than requiring the government to prove culpability. The importance of responding expeditiously and professionally to allegations of impropriety has increased dramatically."

For Proskauer, "keeping clients potential criminal matters 'out of the limelight' or 'avoiding the harsh glare of publicity' is of paramount concern. Working quietly and behind the scenes where appropriate, our criminal defense attorneys have negotiated immunity and non-prosecution agreements. More recently, they have engineered global dispositions that simultaneously resolve parallel federal and state criminal, civil and administrative actions."

The firm states that: "The advent of the United States Sentencing Guidelines for organizations has placed a premium on the development of corporate compliance programs and internal investigative procedures. Working with their corporate and regulatory counterparts within the Firm, our criminal defense lawyers have created a set of standardized criteria for qualifying When handling internal investigations, our attorneys are mindful of the potential collateral consequences associated with the matters under investigation, earning the trust of those persons whose conduct is under scrutiny while ethically preserving the legal interests of both the organization and the individual, preserving the attorney-client privilege, shielding the investigative results from inappropriate disclosure, and balancing corporate cooperation with government authorities against the need to protect an organization's legal interests."

As Proskauer Rose's investigation for the whole OCA begins, it is the Metropolitan Council, which represents the whole OCA, which now assumes center stage in the resolution of the OCA financial scandal. The Metropolitan Council is next scheduled to meet at the beginning of June, a few days after the Holy Synod meeting at the end of May.

The Dismissal: New Details Emerge

New details surrounding the sudden dismissal of former Chancellor Fr. Robert Kondratick are emerging in addition to those previously reported in the Washington Post, Wall Street Journal and the Associated Press over the weekend:

• Fr. Kondratick was asked not to attend the Administrative Committee meeting held Thursday, March 16, in Syosset. On the other hand, Mr. Steve Lamos, an auditor with accounting firm of Lambrides, Lamos and Malthroup, the firm that has been conducting the 2004 audit since January 23rd, was present, as were two attorneys from Proskauer Rose.

• It was reported in the Wall Street Journal that the grounds for Fr. Kondratick's dismissal concerned "authorization of expenditures" and "obedience"; and that Fr. Kondratick had retained the services of attorney Harry H. Kutner Jr, Esq. According to Kutner, as cited in the Journal, the reference to obedience involved Fr. Kondratick's refusal to fully cooperate with the auditors after having been instructed by the Metropolitan to do so. Informed sources add that the dismissal itself was precipitated by the Metropolitan's receipt of an accusatory letter from Kondratick's attorney. The Metropolitan interpreted this letter as an attack on the Church. OCANews has learned Mr. Kutner is a criminal lawyer based in Mineola.

• Fr. Kondratick's dismissal was effective immediately, although he was given until 1 June to vacate the church-owned rectory in Syosset. There was no parish assignment.

• The wife of the former Chancellor, Matushka Bette Kondratick, who is the Administrator of the OCA Pension Fund, was not dismissed from her position. It has been reported, though, that all the locks were changed in Syosset, and Mrs. Kondratick is able to enter her office only when someone else is present.

• The Holy Synod was not given prior notification of the dismissal. The statute provides that the Holy Synod appoints the Chancellor upon the commendation of the Metropolitan Council (Art.  II Section7 (m). According to sources who declined to be identified, justification for the dismissal was predicated on Article IV, Section 2 (i) of the Statute which states the Metropolitan:
"(i) Has the right of pastoral initiative and guidance, and when necessary the right of pastoral intervention, in all matters concerning the life of the Church within the framework of the holy canons."

One Negative Reaction

At least one Bishop was not pleased at the sudden dismissal. In an Internet posting on Sunday, March 19th, Bishop Tikhon of the West offered the following information:

"No proposal or consideration of discharging the Chancellor was heard at the meeting of the Holy Synod. It did not come up at all. In fact, I got an email from the person who took notes asking if I had any idea what was going on....

...(The) first information of the summary firing of Protopresbyter R.S. Kondratick was revealed at the ad hoc Administrative Committee (Administrative Committee of the Metropolitan Council) at Syosset under the chairmanship of His Beatitude, the Metropolitan. No proposals were considered, no motions were made, and the previously prepared material was read out to those in attendance. The Chancellor was barred from attending the meeting, although the Statute makes him a member of the Committee....

"Yes, it was the hired "outside" accountants and the hired downtownlawyers of Prok-auer Rose (I got their names, but I can only recall one first name, "Sarah") who got to sit in the Administrative Committee (Administrative Committee of the Metropolitan Council,
minus the Chancellor) and be afforded the first knowledge of the firing of the Protopresbyter. We haven't seen such decisiveness since the totalitarian implementation of the calendar change in this or
that diocese! "

(Editor's note: By this reference is understood then- Bishop Herman's imposition of the New Calendar on all parishes in his Diocese of E. PA in the early 1980's.)

..."After the meeting Herr Pfarrer Paul Kucynda sent the members of the Holy Synod a fax, in which they learned, even later than the Administrative Committee, that the Protopresbyter had been fired. I myself was in San Francisco: the funeral and burial of Father Victor Sokolov was on Thursday and no one from the Chancery got leave to attend.... However, by chance, the Metropolitan's current Secretary, Archpriest David Brum had got permission to visit the Diocese of the West before Father Victor had fallen asleep, so he was able to attend and it could be technically represented that the Chancery extended its sympathy in his person...

....While I have not spoken to all the members of our Synod, I know that at least 9 of them were completely floored by this astonishing event. "

The Next Move

According to the OCA Treasurer in his recent letter to the Metropolitan Council the 2004 audit is to be completed no later than March 31, 2006. Its publication will shed more light on these events, as well as provide a starting point for the ongoing investigation.

               

- Mark Stokoe

 

 

 

 

 
     
 

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