Charlotte Catholic High Foundation, ex-principal’s attorney spar over spending of money

cwootson@charlotteobserver.com slyttle@charlotteobserver.comJune 19, 2014 

Jerry Healy

CHARLOTTE CATHOLIC WEBSITE

The Charlotte Catholic High School Foundation sent a letter this week to donors, saying former Principal Jerry Healy admitted “making personal use of funds held by the foundation.”

The foundation’s letter contended that an investigation into disbursements “uncovered a significant number of irregular and unauthorized transactions made by two former diocesan employees.”

But Bob McDonnell, one of two attorneys representing Healy, who resigned a month ago, says the former principal used money to help current and former Charlotte Catholic students and their families.

McDonnell said the foundation did not establish procedures for how money should be allocated, and he suggested that Healy used money donated to a separate account set up in memory of the principal’s daughter, Megan, who died in 1996.

The resignation of Healy, who had been principal at Charlotte Catholic for 11 years and worked in the Charlotte Catholic school system for 44 years, has become a controversial issue in Charlotte’s Catholic community.

In her May letter announcing Healy’s resignation, diocesan schools Superintendent Janice Ritter disclosed that Deloitte Financial Services, which was hired to review accounts belonging to Charlotte Catholic High, “did discover questionable disbursements” and “other areas of concern.”

In its letter this week, the Charlotte Catholic High School Foundation says an audit uncovered nearly $90,000 of “misappropriated funds” by two employees. The other employee was not named.

The letter says the money went to travel abroad and checks paid to families who don’t attend Charlotte Catholic, and some money was diverted to a personal checking account. In one meeting, the letter says, Healy admitted making use of funds held by the foundation but couldn’t or wouldn’t provide details about “checks written to himself, family members and others.”

The letter says the ultimate dollar amount that administrators believe was misappropriated is not known, “although it is significant.” In fiscal year 2013, the letter says, the school’s foundation reported $47,864 to the IRS as “loss-misappropriation of funds” and an additional $40,339 was “loss-unauthorized use of funds.”

McDonnell, in a statement issued Thursday, painted a different picture.

He said the Megan Healy fund established by the Charlotte Catholic High community had been linked to the Charlotte Catholic High School Foundation. It initially gave two $1,000 scholarships annually to Catholic High seniors, but he said the fund grew significantly in recent years.

“The excess funds were used to help the Charlotte Catholic family,” McDonnell said. “From Mr. Healy’s vantage point, the Charlotte Catholic family included the students, their parents, alumni and their families, and teachers and staff.

“Once you were a part of the Charlotte Catholic family, you were always a part of the family.”

McDonnell said the money was used to help those in need. Uses included paying students’ tuition, buying lunch for students and staff who could not afford it, tutoring, making mortgage or other payments, and help with utility bills and medical care.

And, he said, the foundation’s treasurer had access to all bank statements. McDonnell contended the Foundation has “failed to accept any role in the financial woes.”

In its letter, the foundation said the internal review of financial records began in summer 2013, after the organization had lost its tax-exempt status from the IRS, because it did not file tax returns for several years. Foundation officials said they have answered all IRS questions and have their tax-exempt status back again.

The letter also noted that Healy “has, without question, helped many families in need over the years.”

But, the foundation added, the review “found something more. Money intended for CCHS students and faculty was diverted for personal use.” The letter did not specify which person was responsible for doing that.

McDonnell acknowledged that Healy “received assistance, as well.”

“He informed staff that he had received benefits,” the attorney said. “He recognized he could have better handled the matter of his personal financial assistance.”

Healy has declined comment, and Cindy Grim, the foundation’s president, did not return a call seeking comment. Observer staff writer Tim Funk contributed.

Wootson: 704-358-5046; Twitter: @CleveWootson

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