"It's The Biggest Sex-Abuse Bankruptcy Of All Time" - Facing 100s Of Lawsuits, Boy Scouts Of America Goes Chapter 11

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by Tyler Durden
Tuesday, Feb 18, 2020 - 09:45 PM

When we last checked in on the Boy Scouts of America, the organization was reeling from a deluge of sex-abuse lawsuits that was soaking up all of its financial resources and attention, raising the possibility of a bankruptcy filing to help the organization escape the hefty penalties and allow the 110-year-old nonprofit to survive.

This strategy should be familiar to Zero Hedge readers by now: it's the same playbook used by opioid maker Purdue Pharma and troubled wildfire-starting California utility PG&E.

And on Tuesday, the organization finally followed through: According to Fox News, the BSA filed for Chapter 11 bankruptcy protection early Tuesday following decades of sex abuse claims by troop leaders.

The petition was filed in Delaware bankruptcy court, and will halt the hundreds of lawsuits that the organization is facing after several states passed laws allowing abuse lawsuits based on allegations stretching back to the 1960s to proceed against the organization.

In response to the bankruptcy filing, an attorney who is representing some 300 alleged victims said that 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 more than 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 scouts organization said it's filing for bankruptcy to guarantee that victims are fairly compensated for any abuse suffered during their time in scouting. A Victims' Compensation Trust will be set up during the bankruptcy process, which the organization says will allow for "equitable compensation."

The organization added that it wants scouting to survive:

"The BSA cares deeply about all victims of abuse and sincerely apologizes to anyone who was harmed during their time in Scouting. We are outraged that there have been times when individuals took advantage of our programs to harm innocent children," said Roger Mosby, president and chief executive officer of the BSA.

"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."

The BSA has also published an "open letter to victims", which be found online, or as a full-page ad in the Feb. 19 edition of USA Today.

We bring you the full text below:

Any incident of child abuse is one too many.

As a father, a former Scout, and the National Chair of the Boy Scouts of America, I am truly heartbroken that you were harmed during your time in Scouting and that you carry unfathomable pain.

I am outraged that individuals took advantage of our programs to commit these heinous acts.

I am also outraged that there were times when volunteers and employees ignored our procedures or forgave transgressions that are unforgivable. In some cases, this led to tragic acts of abuse. While those instances were limited, they mean we didn’t do enough to protect the children in our care – to protect you.

On behalf of myself and the entire Scouting community: I am sorry. I am devastated that there were times in the past when we failed the very children we were supposed to protect.

Please know we have worked consistently over many years to implement multilayered policies to keep kids safe. As knowledge on child sexual abuse prevention has advanced, so have our expert-informed policies, including mandatory background checks and trainings, a ban on one-on-one interactions between youth and adults, and mandatory reporting of any suspicion of abuse to law enforcement. Today, we believe the BSA’s youth safety measures are the strongest and most effective policies found in any youth-serving organization.

I regret that these measures weren’t always in place or weren’t always enough. The fact is that predators harmed innocent children in Scouting programs, and for this I am deeply sorry.

The BSA cannot undo what happened to you, but we are committed to supporting you and to doing everything in our power to prevent it from happening to others. It is a social and moral responsibility that I and the entire organization take extremely seriously. We believe that all victims should receive our support and compensation – and we have taken decisive action to make that possible.

Specifically, the national organization of the Boy Scouts of America has initiated a voluntary financial restructuring to ensure we can equitably compensate all victims of past abuse in our programs, through a proposed Victim’s Compensation Trust.

I encourage you, and all victims to come forward and file claims so you can receive compensation from this Trust. We will provide clear notices about how to do so.

I want you to know that we believe you, we believe in compensating you, and we have programs in place to pay for counseling for you and your family by a provider of your choice.

We have also partnered with 1in6, a trusted national resource for male survivors, to expand their services so that you are able to anonymously access vital support from trained advocates when and how you need it. You can access these services at

The abuse you suffered weighs on us all every day. But your courage also motivates us to do more for the children we are entrusted to protect. We will do better – for you, for kids today, and for kids tomorrow.

Yours in Scouting, Jim Turley, National Chair, Boy Scouts of America

Sadly, as we learned from the Catholic Church and numerous other examples in recent decades, institutions can survive allegations of widespread sex abuse.

A bigger threat for the Boy Scouts is the advent of social media and video games, which encourage kids to stay home with their screens, far away from nature. To a tech-addicted pre-teen, there's probably nothing that sounds more nightmarish then a weekend out in the woods with your weird classmate's dad.