Bishop Edward Scarfenberger. / Credit: Photo courtesy of the Diocese of Albany
National Catholic Register, Dec 19, 2025 / 12:24 pm (CNA).
A retired New York bishop has filed for personal bankruptcy protection in federal court after a state jury verdict found him, along with other officials, personally liable for the collapse of a Catholic hospital pension fund that left about 1,100 retirees without the lifetime monthly payments they were expecting.
It’s not clear whether a Catholic bishop in the United States has ever previously filed for personal bankruptcy protection.
Bishop Edward Scharfenberger, 77, who served as bishop of Albany from April 2014 until his retirement in October, is seeking protection from creditors for his assets valued at between $100,001 and $500,000, according to a filing Tuesday in the U.S. Bankruptcy Court for the Northern District of New York.
The seven-page filing does not list the bishop’s assets but states that he has between 100 and 199 creditors and debts totaling between $1,000,001 and $10 million.
Last week, a jury found Scharfenberger 10% liable in a $54.2 million judgment in a civil lawsuit over the failed pension plan once provided by St. Clare’s Hospital in Schenectady, a Catholic hospital that operated from 1949 until 2008, according to The Evangelist, the diocese’s newspaper.
The verdict and judgment, issued Dec. 12, cover compensatory damages — the amount a court finds is owed to plaintiffs for harm they have suffered — but not punitive damages, which may be added in cases of recklessness, malice, or fraud. The bankruptcy filings by the bishop and another defendant in the state lawsuit over the pension plan failure forced a pause in a punitive damages hearing earlier this week, according to WNYT Channel 13 in Albany.
The National Catholic Register, CNA’s sister news partner, was unable to reach Scharfenberger before the publication of this story. A lawyer representing the bishop acknowledged a request for comment Dec. 17 but did not immediately provide one.
A rare personal bankruptcy
In recent decades, bankruptcies have occurred regularly in the Catholic Church in the United States. Between 2004 and November 2025, 39 of the country’s dioceses have filed for bankruptcy, almost all to protect assets from clergy sex-abuse lawsuits, as the Register reported last month. One of those is the Diocese of Albany, which filed for bankruptcy in March 2023.
But those diocesan cases were filed under Chapter 11 of the U.S. Bankruptcy Code, which allows a corporation, partnership, or sole proprietorship to reorganize and continue operating while developing a court-approved plan to repay creditors.
Scharfenberger filed under Chapter 13, which allows an individual with regular income who cannot pay debts to keep certain assets while working out a repayment plan.
“The rules in Chapter 13 permit a debtor to keep property and confirm a plan with payments to creditors based on the debtor’s ‘disposable income,’” said Marie Reilly, a bankruptcy expert and law professor at Penn State Dickinson Law, in an email. “If the debtor commits his disposable income to paying creditors for the term of a three- to five-year plan, he gets a discharge (forgiveness) of the unpaid balance.”
Reilly, who has researched several dozen diocesan bankruptcies for The Catholic Project, a lay initiative of The Catholic University of America in Washington, D.C., told the Register that the bankruptcy filing does not necessarily solve all of the bishop’s money problems.
“There are exceptions — some debts don’t get discharged. Creditors can object to the plan if it does not meet the statutory requirements,” Reilly said. “And, it is possible that the pension fund creditor may move to dismiss the bishop’s Chapter 13 case as having been filed ‘in bad faith.’”
$50 million shortfall
St. Clare’s Hospital was originally run by the Franciscan Sisters of the Poor. The Diocese of Albany maintains that it never owned the hospital and that the bishop of Albany merely provided “canonical oversight” to make sure the hospital met “its mission to serve all in accord with Catholic moral standards,” according to an August 2025 statement from the diocese.
Last week, the jury found that the Diocese of Albany has no liability for the pension failure, instead holding the hospital corporation and certain officers and board members accountable.
In addition to Scharfenberger, the jury found two deceased employees of the diocese liable, according to The Evangelist: Former Albany Bishop Howard Hubbard (1938–2023), who led the diocese from 1977 to 2014, was found 20% liable; and Father David LeFort, a former vicar general of the diocese who died in August 2023, was found 5% liable.
Also found liable were St. Clare’s Corporation (20%), St. Clare’s president Joseph Pofit (25%), and former St. Clare’s president Robert Perry (20%), according to The Evangelist.
The judgments stem from a pension plan that operated for about 60 years.
In 1959, the hospital began offering employees a defined-benefit plan that provided a lifetime monthly pension after retirement.
Church plan exempt from ERISA
Like most plans operated by Catholic institutions, the pension plan had a religious exemption from the federal Employee Retirement Income Security Act of 1974 (known as ERISA), which sets minimum funding requirements for most nonreligious pension plans and also enables the federal government to step in and make payments to retirees of failed plans, using a fund financed by covered pension plans.
When the hospital closed in 2008, the officers of St. Clare’s “determined that the corporation would continue to exist for purposes of administering the pension plan,” according to a complaint filed in state court in Schenectady County by the New York attorney general’s office in May 2022.
“They also chose to continue treating the pension plan as a ‘Church plan’ — which it could do only if the corporation’s former employees and pensioners were designated as employees of the Church. This was all in order to avoid the contribution and insurance requirements of ERISA, and the duties imposed by ERISA upon corporation directors and trustees as fiduciaries,” the complaint states.
The bishop of Albany was automatically a member of the hospital’s board and served as its honorary chairman, and had authority to appoint most of the directors on the board, according to the state attorney general’s complaint.
The attorney general’s office alleged that St. Clare’s Corporation failed to make contributions to the pension fund “for all but three years from 2001 to 2019” and concealed from retirees “the insolvency of the pension plan.”
In 2018, the St. Clare’s board terminated the pension plan effective Feb. 1, 2019, because of an approximately $50 million shortfall. More than 1,100 employees lost retirement benefits, including about 650 who lost all pension payments and about 450 who received a lump-sum payment “equal to 70% of the value of their vested pension,” the complaint states. The retired employees include “nurses, lab technicians, social workers, EMTs, orderlies, housekeepers, and other essential workers” who worked at the hospital “between 10 and 50 years,” the complaint states.
Testimony and reaction
On Dec. 9 during the civil trial, Scharfenberger testified that during his tenure no boards he sat on ever discussed the hospital’s pension plan, according to The Times-Union of Albany.
In a written statement issued in August, when Scharfenberger still led the Diocese of Albany, the diocese said the bishop “has actively sought ways to help the pensioners” while denying that the diocese ever “exercised any control over St. Clare’s Hospital operations or its pension.”
“He hosted a listening session with pensioners at Siena College to identify issues and consider ways to help those in need. He also reached out to the Mother Cabrini Foundation to try to secure funding for the pensioners, but that effort was unable to move forward once the pensioners filed the lawsuit,” the statement said.
“The diocese is eager to see the case move forward and promptly resolved,” the August statement continued. “Our prayers continue for all who are struggling in any way, and as we stated previously, our offer to connect those in need with services that can help, stands. No one should walk alone.”
His successor, Bishop Mark O’Connell, who was installed as bishop of Albany on Dec. 5, told reporters shortly before the verdict was announced last week: “I care deeply about their hurt [and] not having their pensions,” according to The Evangelist.
During the Dec. 12 press conference, when a reporter asked O’Connell what the diocese would do if the jury found the diocese liable for the pension fund collapse, the bishop noted that the diocese is already in the midst of a bankruptcy process.
“If we are liable, then we’ll do what we can to make amends, given that they are one creditor as a group among many people accusing the Diocese of Albany,” O’Connell said, according to WAMC Northeast Public Radio. “And that’s what bankruptcy process is. We obviously cannot pay a billion dollars. Right? So that’s what Chapter 11 is all about, to figure out what’s fair. And since you have a bankruptcy judge and mediators, it’s not up to us.”
Later that day, the jury found the diocese not liable in the pension fund collapse lawsuit. The diocese issued a written statement, according to The Evangelist, that said: “As grateful as we are for the jury’s informed decision, we are still very much aware of the hurt felt by the St. Clare’s pensioners who cared for the sick and the poor throughout the long history of St. Clare’s Hospital. This does not mean that we will turn our backs to the pensioners, for as Bishop O’Connell has noted, they are a part of our flock; they are still in need of healing.”
That same day, lead plaintiff Mary Hartshorne, who worked in the hospital’s radiology department for about 28 years, told WNYT Channel 13 in Albany that she and other hospital retirees were pleased with the jury’s verdict but did not feel they would be made whole.
“We’ve been playing this game for seven and a half years, and I think my question I ask everybody is: How do you get that back? You don’t,” she said.
This story was first published by the National Catholic Register, CNA’s sister news partner, and has been adapted by CNA.
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![Homeland Security Department says rule will address religious worker visa backlog #Catholic
Credit: Lisa F. Young/Shutterstock
Jan 14, 2026 / 10:25 am (CNA).
The Department of Homeland Security (DHS) said it is addressing a religious worker visa backlog with rules that will reduce wait times and disruptions in ministry for faith-based communities.“Under the leadership of Secretary [Kristi] Noem, DHS is committed to protecting and preserving freedom and expression of religion. We are taking the necessary steps to ensure religious organizations can continue delivering the services that Americans depend on,” a DHS spokesperson said in a press release Wednesday. “Pastors, priests, nuns, and rabbis are essential to the social and moral fabric of this country. We remain committed to finding ways to support and empower these organizations in their critical work.”Under the rule expected to be issued Jan. 14, religious workers in the country on R-1 visas would no longer be required to reside outside of the U.S. for a full year if they reach their statutory five-year maximum period of stay before completing their green card applications. “While R-1 religious workers are still required to depart the U.S., the rule establishes that there is no longer a minimum period of time they must reside and be physically present outside the U.S. before they seek readmission in R-1 status,” DHS said.DHS acknowledged the significant demand for visas within the EB-4 category “has exceeded the supply for many years,” citing 2023 changes implemented by President Joe Biden’s State Department. “By eliminating the one-year foreign residency requirement, USCIS [U.S. Citizenship and Immigration Services] is reducing the time religious organizations are left without their trusted clergy and non-ministerial religious workers,” according to a DHS statement.The rule, expected to be issued at 11 a.m. Jan. 14, is effective immediately, DHS said.Secretary of State Marco Rubio said in a press conference in December 2025 that the government would reveal its plan “early next month” for religious worker visas that would avoid giving preference to one denomination over another. Rubio noted that the plan would not favor one religion over another and that there would be “country-specific requirements depending on the country they’re coming from.” “I think we’re going to get to a good place,” Rubio said at the time. “We don’t have it ready yet. All this takes time to put together, but we’re moving quickly. I think we’ll have something positive about that at some point next month, hopefully in the early part of next month.”Visas for religious workers allow foreign nationals to work for a U.S. religious organization, through the temporary R-1 visa or a Green Card EB-4 visa, which requires at least two years of membership in the same denomination and a job offer from a qualifying nonprofit religious group.Rubio had also said in August the administration was working to create a “standalone process” for religious workers, separate from other competing applicants to the employment-based fourth preference (EB-4) category of visas that became severely backlogged after an unprecedented influx in unaccompanied minor applicants — most of which the USCIS has since alleged were fraudulent — who were added to the already-tight category under the Biden administration.In November 2025, a Catholic diocese in New Jersey dropped a lawsuit filed against the Biden administration’s State Department, Department of Homeland Security, and USCIS, citing knowledge of a solution with national implications.Since the issue of the backlogged visas started, multiple U.S. dioceses have called for a solution. Priests in the Archdiocese of Boston who are in the U.S. on visas were urged to avoid international travel amid the Trump administration’s immigration policies and deportations.Priests and other Church leaders have expressed fear of having to leave their ministries and return to their home countries, then endure lengthy wait times before coming back. Church officials have warned that a continuing backlog could lead to significant priest shortages in the United States.“We are grateful for the administration’s attention to this important issue for the Church and value the opportunity for ongoing dialogue to address these challenges so the faithful can have access to the sacraments and other essential ministries,” a spokesperson for the USCCB told CNA.](https://unitedyam.com/wp-content/uploads/2026/01/homeland-security-department-says-rule-will-address-religious-worker-visa-backlog-catholic-credit-lisa-f-young-shutterstockjan-14-2026-1025-am-cna-the-department-of-homeland-security.jpg)
![CNA explains: How does ‘Mass dispensation’ work, and when is it used? #Catholic
null / Credit: FotoDax/Shutterstock
CNA Staff, Dec 26, 2025 / 06:00 am (CNA).
Amid heavy immigration enforcement by the Trump administration, several bishops in the U.S. have recently issued broad dispensations to Catholics in their dioceses, allowing them to refrain from attending Mass on Sundays if they fear arrest or deportation from federal officials.Bishops in North Carolina, California, and elsewhere have issued such dispensations, stating that those with legitimate concerns of being detained by immigration agents are free from the usual Sunday obligation.The Church’s canon law dictates that Sunday is considered the “primordial holy day of obligation,” one on which all Catholics are “obliged to participate in the Mass.” Several other holy days of obligation exist throughout the liturgical year, though Sunday (or the Saturday evening prior) is always considered obligatory for Mass attendance.The numerous dispensations issued recently in dioceses around the country have underscored, however, that bishops have some discretion in allowing Catholics to stay home from Mass for legitimate reasons.Dispensation must be ‘just,’ ‘reasonable’David Long, an assistant professor in the school of canon law at The Catholic University of America as well as the director of the school’s Institute for Policy Research and Catholic Studies, told CNA that bishops have the authority to dispense the faithful in their diocese with, as the Code of Canon Law puts it, a “just and reasonable cause.”“This generally applies when a holy day of obligation falls on a Saturday or Monday, during severe weather events (snowstorms, hurricanes, floods, etc.), when there is no reasonable access to Mass, or during public emergencies such as pandemics or plagues,” he said. Once such circumstances end, he noted, the dispensation itself would cease.By virtue of their office, diocesan administrators, vicars general, and episcopal vicars also have the power to issue dispensations, Long said.Priests, however, normally do not have that authority “unless expressly granted by a higher authority, such as their diocesan bishop,” he said.Canon law, he said, dictates that a dispensation can only be granted when a bishop “judges that it contributes to [the] spiritual good” of his flock, for a just cause, and “after taking into account the circumstances of the case and the gravity of the law from which dispensation is given.”The lay faithful themselves can determine, in some cases, when they can refrain from going to Mass, though Long stressed that such instances do not constitute “dispensation,” as the laity “does not have the power to dispense at any time” that authority being tied to “executive power in the Church” via ordination.Canon law dictates, however, that Catholics are not bound to attend Mass when “participation in the Eucharistic celebration becomes impossible.”Long said such scenarios include “when [the faithful] are sick, contagious, or housebound, when they are the primary caregiver for someone else and cannot arrange coverage for that person, when traveling to Mass is dangerous, when there is no realistic access to Mass, or for some other grave cause.”“This is not a dispensation,” he said, “but instead is a legal recognition of moral and physical impossibility at times.”The recent immigration-related controversy isn’t the only large-scale dispensation in recent memory. Virtually every Catholic in the world was dispensed from Mass in the earliest days of the COVID-19 crisis, when government authorities sharply limited public gatherings, including religious gatherings, all over the world.In 2024, on the other hand, the Vatican said that Catholics in the United States must still attend Mass on holy days of obligation even when they are transferred to Mondays or Saturdays, correcting a long-standing practice in the U.S. Church and ending a dispensation with which many Catholics were familiar.‘The most incredible privilege we could possibly imagine’Though the obligation to attend Mass is a major aspect of Church canon law, Father Daniel Brandenburg, LC, cautioned against interpreting it uncharitably.“This ‘obligation’ is sort of like the obligation of eating,” he said. “If you don’t eat, you’ll die. Similarly, the Church simply recognizes that if we don’t nourish our soul, it withers away and dies. The bare minimum to survive is Mass once a week on Sundays.”“Most people find the ‘obligation’ of eating to be quite pleasurable,” he continued, “and I think anyone with a modicum of spiritual awareness finds deep joy in attending Mass and receiving the Creator of the universe into their soul. At least I do.”Like Long, Brandenburg stressed that the lay faithful lack the authority to “dispense” themselves from Mass. Instead, they are directed to follow their consciences when determining if they are incapable of attending Mass, particularly by applying the principle of moral theology “ad impossibilia, nemo tenetur” “(no one is obliged to do what is impossible”).Being too sick, facing dangerous inclement weather, or lacking the ability to transport themselves are among the reasons the faithful might determine they are unable to attend Mass, he said.“Here, beware the lax conscience which gives easy excuses,” Brandenburg warned, “and remember that the saints became holy not through excuses, but through heroic love.”](https://unitedyam.com/wp-content/uploads/2025/12/cna-explains-how-does-mass-dispensation-work-and-when-is-it-used-catholic-null-credit-fotodax-shutterstockcna-staff-dec-26-2025-0600-am-cna-amid-heavy-immigratio.webp)
![Federal judge strikes down rules allowing schools to hide gender ‘transitions’ from parents #Catholic
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CNA Staff, Dec 23, 2025 / 10:07 am (CNA).
A federal judge in California this week issued a permanent block against the state’s “gender secrecy policies” that have allowed schools to hide children’s so-called “gender transitions” from their parents.U.S. District Court Judge Roger Benitez issued the ruling in the class action lawsuit on Dec. 22, holding that parents “have a right” to the “gender information” of their children, while teachers themselves also possess the right to provide parents with that information. The order strikes down secretive policies in school districts across California that allowed schools to conceal when a child began identifying as the opposite sex or another LGBT-related identity. Benitez had allowed the legal dispute to proceed as a class action lawsuit in October. School districts in California “are ultimately state agents under state control,” the judge said at the time, and the issue of settling “statewide policy” meant the class action structure would be “superior to numerous individual actions by individual parents and teachers.” The case, Benitez said on Dec. 22, concerns “a parent’s rights to information … against a public school’s policy of secrecy when it comes to a student’s gender identification.” Parents, he said, have a right to such information on grounds of the 14th and First Amendments, he said, while teachers can assert similar First Amendment rights in sharing that information with parents. Teachers have historically informed parents of “physical injuries or questions about a student’s health and well-being,” the judge pointed out, yet lawmakers in California have enacted policies “prohibiting public school teachers from informing parents” when their child claims to have an LGBT identity. “Even if [the government] could demonstrate that excluding parents was good policy on some level, such a policy cannot be implemented at the expense of parents’ constitutional rights,” Benitez wrote. The Thomas More Society, a religious liberty legal group, said in a press release that the decision “protects all California parents, students, and teachers” and “restores sanity and common sense.”School officials in California who work to conceal “gender identity” decisions from parents “should cease all enforcement or face severe legal consequences,” attorney Paul Jonna said in the release. Elizabeth Mirabelli and Lori Ann West, the Christian teachers who originally brought the suit, said they were “profoundly grateful” for the decision. “This victory is not just ours. It is a win for honesty, transparency, and the fundamental rights of teachers and parents,” they said. The Thomas More Society said on Dec. 22 that California officials had gone to “extreme lengths” to “evade responsibility” for their policies, up to and including claiming that the gender secrecy rules were no longer enforced even as they were allegedly continuing to require them. Gender- and LGBT-related school policies have come under fire over the past year from the White House. The U.S. Department of Health and Human Services in August directed U.S. states to remove gender ideology material from their curricula or else face the loss of federal funding. In February the Department of Education launched an investigation into several Virginia school districts to determine if they violated federal orders forbidding schools from supporting the so-called “transition” of children. In December, meanwhile, a Catholic school student in Virginia forced a school district to concede a lawsuit she brought alleging that her constitutional rights had been violated when the school subjected her to “extreme social pressure” to affirm transgender ideology.](https://unitedyam.com/wp-content/uploads/2025/12/federal-judge-strikes-down-rules-allowing-schools-to-hide-gender-transitions-from-parents-catholic-null-credit-sergign-shutterstockcna-staff-dec-23-2025-1007-am-cna.webp)
![Albany’s retired bishop files for personal bankruptcy #Catholic
Bishop Edward Scarfenberger. / Credit: Photo courtesy of the Diocese of Albany
National Catholic Register, Dec 19, 2025 / 12:24 pm (CNA).
A retired New York bishop has filed for personal bankruptcy protection in federal court after a state jury verdict found him, along with other officials, personally liable for the collapse of a Catholic hospital pension fund that left about 1,100 retirees without the lifetime monthly payments they were expecting.It’s not clear whether a Catholic bishop in the United States has ever previously filed for personal bankruptcy protection.Bishop Edward Scharfenberger, 77, who served as bishop of Albany from April 2014 until his retirement in October, is seeking protection from creditors for his assets valued at between $100,001 and $500,000, according to a filing Tuesday in the U.S. Bankruptcy Court for the Northern District of New York.The seven-page filing does not list the bishop’s assets but states that he has between 100 and 199 creditors and debts totaling between $1,000,001 and $10 million.Last week, a jury found Scharfenberger 10% liable in a $54.2 million judgment in a civil lawsuit over the failed pension plan once provided by St. Clare’s Hospital in Schenectady, a Catholic hospital that operated from 1949 until 2008, according to The Evangelist, the diocese’s newspaper.The verdict and judgment, issued Dec. 12, cover compensatory damages — the amount a court finds is owed to plaintiffs for harm they have suffered — but not punitive damages, which may be added in cases of recklessness, malice, or fraud. The bankruptcy filings by the bishop and another defendant in the state lawsuit over the pension plan failure forced a pause in a punitive damages hearing earlier this week, according to WNYT Channel 13 in Albany.The National Catholic Register, CNA’s sister news partner, was unable to reach Scharfenberger before the publication of this story. A lawyer representing the bishop acknowledged a request for comment Dec. 17 but did not immediately provide one.A rare personal bankruptcyIn recent decades, bankruptcies have occurred regularly in the Catholic Church in the United States. Between 2004 and November 2025, 39 of the country’s dioceses have filed for bankruptcy, almost all to protect assets from clergy sex-abuse lawsuits, as the Register reported last month. One of those is the Diocese of Albany, which filed for bankruptcy in March 2023. But those diocesan cases were filed under Chapter 11 of the U.S. Bankruptcy Code, which allows a corporation, partnership, or sole proprietorship to reorganize and continue operating while developing a court-approved plan to repay creditors.Scharfenberger filed under Chapter 13, which allows an individual with regular income who cannot pay debts to keep certain assets while working out a repayment plan. “The rules in Chapter 13 permit a debtor to keep property and confirm a plan with payments to creditors based on the debtor’s ‘disposable income,’” said Marie Reilly, a bankruptcy expert and law professor at Penn State Dickinson Law, in an email. “If the debtor commits his disposable income to paying creditors for the term of a three- to five-year plan, he gets a discharge (forgiveness) of the unpaid balance.”Reilly, who has researched several dozen diocesan bankruptcies for The Catholic Project, a lay initiative of The Catholic University of America in Washington, D.C., told the Register that the bankruptcy filing does not necessarily solve all of the bishop’s money problems.“There are exceptions — some debts don’t get discharged. Creditors can object to the plan if it does not meet the statutory requirements,” Reilly said. “And, it is possible that the pension fund creditor may move to dismiss the bishop’s Chapter 13 case as having been filed ‘in bad faith.’”$50 million shortfall St. Clare’s Hospital was originally run by the Franciscan Sisters of the Poor. The Diocese of Albany maintains that it never owned the hospital and that the bishop of Albany merely provided “canonical oversight” to make sure the hospital met “its mission to serve all in accord with Catholic moral standards,” according to an August 2025 statement from the diocese.Last week, the jury found that the Diocese of Albany has no liability for the pension failure, instead holding the hospital corporation and certain officers and board members accountable. In addition to Scharfenberger, the jury found two deceased employees of the diocese liable, according to The Evangelist: Former Albany Bishop Howard Hubbard (1938–2023), who led the diocese from 1977 to 2014, was found 20% liable; and Father David LeFort, a former vicar general of the diocese who died in August 2023, was found 5% liable. Also found liable were St. Clare’s Corporation (20%), St. Clare’s president Joseph Pofit (25%), and former St. Clare’s president Robert Perry (20%), according to The Evangelist.The judgments stem from a pension plan that operated for about 60 years. In 1959, the hospital began offering employees a defined-benefit plan that provided a lifetime monthly pension after retirement.Church plan exempt from ERISALike most plans operated by Catholic institutions, the pension plan had a religious exemption from the federal Employee Retirement Income Security Act of 1974 (known as ERISA), which sets minimum funding requirements for most nonreligious pension plans and also enables the federal government to step in and make payments to retirees of failed plans, using a fund financed by covered pension plans.When the hospital closed in 2008, the officers of St. Clare’s “determined that the corporation would continue to exist for purposes of administering the pension plan,” according to a complaint filed in state court in Schenectady County by the New York attorney general’s office in May 2022. “They also chose to continue treating the pension plan as a ‘Church plan’ — which it could do only if the corporation’s former employees and pensioners were designated as employees of the Church. This was all in order to avoid the contribution and insurance requirements of ERISA, and the duties imposed by ERISA upon corporation directors and trustees as fiduciaries,” the complaint states.The bishop of Albany was automatically a member of the hospital’s board and served as its honorary chairman, and had authority to appoint most of the directors on the board, according to the state attorney general’s complaint.The attorney general’s office alleged that St. Clare’s Corporation failed to make contributions to the pension fund “for all but three years from 2001 to 2019” and concealed from retirees “the insolvency of the pension plan.”In 2018, the St. Clare’s board terminated the pension plan effective Feb. 1, 2019, because of an approximately $50 million shortfall. More than 1,100 employees lost retirement benefits, including about 650 who lost all pension payments and about 450 who received a lump-sum payment “equal to 70% of the value of their vested pension,” the complaint states. The retired employees include “nurses, lab technicians, social workers, EMTs, orderlies, housekeepers, and other essential workers” who worked at the hospital “between 10 and 50 years,” the complaint states.Testimony and reactionOn Dec. 9 during the civil trial, Scharfenberger testified that during his tenure no boards he sat on ever discussed the hospital’s pension plan, according to The Times-Union of Albany. In a written statement issued in August, when Scharfenberger still led the Diocese of Albany, the diocese said the bishop “has actively sought ways to help the pensioners” while denying that the diocese ever “exercised any control over St. Clare’s Hospital operations or its pension.” “He hosted a listening session with pensioners at Siena College to identify issues and consider ways to help those in need. He also reached out to the Mother Cabrini Foundation to try to secure funding for the pensioners, but that effort was unable to move forward once the pensioners filed the lawsuit,” the statement said. “The diocese is eager to see the case move forward and promptly resolved,” the August statement continued. “Our prayers continue for all who are struggling in any way, and as we stated previously, our offer to connect those in need with services that can help, stands. No one should walk alone.”His successor, Bishop Mark O’Connell, who was installed as bishop of Albany on Dec. 5, told reporters shortly before the verdict was announced last week: “I care deeply about their hurt [and] not having their pensions,” according to The Evangelist.During the Dec. 12 press conference, when a reporter asked O’Connell what the diocese would do if the jury found the diocese liable for the pension fund collapse, the bishop noted that the diocese is already in the midst of a bankruptcy process.“If we are liable, then we’ll do what we can to make amends, given that they are one creditor as a group among many people accusing the Diocese of Albany,” O’Connell said, according to WAMC Northeast Public Radio. “And that’s what bankruptcy process is. We obviously cannot pay a billion dollars. Right? So that’s what Chapter 11 is all about, to figure out what’s fair. And since you have a bankruptcy judge and mediators, it’s not up to us.”Later that day, the jury found the diocese not liable in the pension fund collapse lawsuit. The diocese issued a written statement, according to The Evangelist, that said: “As grateful as we are for the jury’s informed decision, we are still very much aware of the hurt felt by the St. Clare’s pensioners who cared for the sick and the poor throughout the long history of St. Clare’s Hospital. This does not mean that we will turn our backs to the pensioners, for as Bishop O’Connell has noted, they are a part of our flock; they are still in need of healing.”That same day, lead plaintiff Mary Hartshorne, who worked in the hospital’s radiology department for about 28 years, told WNYT Channel 13 in Albany that she and other hospital retirees were pleased with the jury’s verdict but did not feel they would be made whole.“We’ve been playing this game for seven and a half years, and I think my question I ask everybody is: How do you get that back? You don’t,” she said.This story was first published by the National Catholic Register, CNA’s sister news partner, and has been adapted by CNA.](https://unitedyam.com/wp-content/uploads/2025/12/albanys-retired-bishop-files-for-personal-bankruptcy-catholic-bishop-edward-scarfenberger-credit-photo-courtesy-of-the-diocese-of-albanynational-catholic-register-dec-19-2025-1.webp)