Boy Scouts of America Files for Bankruptcy Amid Drowning in Sex Abuse Lawsuits
110-year-old organization on verge of collapse after hundreds abuse complaints filed
Boy Scouts of America (BSA) has filed for bankruptcy as the organization continues to drown in hundreds of sex abuse lawsuits.
On Tuesday morning, BSA filed for Chapter 11 bankruptcy protection following decades of sexual abuse claims within one of the country's largest youth organizations.
The case filed in Delaware bankruptcy court halts the hundreds of lawsuits the BSA is currently facing.
The suits allege years-worth of sexual misconduct by people within the 110-year-old organization.
The sexual abuse settlements had reportedly placed an overwhelming strain on the Boy Scouts' finances.
Last year, some states passed laws allowing victims of abuse, normally outside the statute of limitations, to sue for damages.
Mike Pfau, an attorney whose firm was representing 300 victims in New York as of last April said the bankruptcy would be "bigger in scale than any other sex abuse bankruptcy."
“You’re talking about thousands of perpetrators," Seattle-based lawyer Michael Pfau, who has represented over 300 Boy Scout victims in 34 states, told the New York Daily News.
"You’re talking about tens of thousands of victims. This will be the largest bankruptcy the country has ever seen, and likely one of the largest corporate bankruptcies.”
The national organization said they made the move to fairly compensate victims harmed during their time in scouting and to keep the 100-year-old nonprofit running for years to come.
A Victims Compensation Trust will reportedly be set up during the bankruptcy process, which the organization says will provide "equitable compensation to victims."
"The BSA cares deeply about all victims of abuse and sincerely apologizes to anyone who was harmed during their time in Scouting," said Roger Mosby, president and chief executive officer of the BSA.
"We are outraged that there have been times when individuals took advantage of our programs to harm innocent children."
"While we know nothing can undo the tragic abuse that victims suffered, we believe the Chapter 11 process – with the proposed Trust structure – will provide equitable compensation to all victims while maintaining the BSA's important mission," he added.
The bankruptcy petition reportedly listed the Boy Scouts' assets as between $1 billion and $10 billion, and its liabilities at $500 million to $1 billion.
Details of BSA's financial struggles began to emerge in late 2018.
As Neon Nettle reported at the time, the BSA's sinking membership numbers coincided with various controversies surrounding the organization, including the decision to change its name from Boy Scouts to the more "gender natural" Scouts BSA in a bid to encourage girls and transgenders to sign up as members.
BSA revealed that the name change was scheduled to come into effect in February 2019, yet membership figures show that one week after they announced the switch on May 2, 2018, 425,000 boys rescinded their membership.
The organization, which has deep roots in American tradition spanning generations, bowed to pressure insisting it become more "gender-inclusive."