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Boy Scouts file for record bankruptcy in face of millions of dollars of sexual abuse claims


The Boy Scouts of America (BSA) filed for Chapter 11 bankruptcy protection early Tuesday after decades of sexual abuse claims within one of the country's largest youth organizations.


The petition, filed in Delaware bankruptcy court, halts the hundreds of lawsuits the BSA is facing that allege sexual misconduct by people within the 110-year-old organization over the years.


It would be the biggest sexual-abuse related bankruptcy in U.S. history. 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.


“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.”


Sexual abuse settlements had reportedly strained the Boy Scouts' finances, with states passing laws last year so victims from long-ago abuse can sue for damages. 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.

BSA President and CEO Roger Mosby defended the organization's bankruptcy Tuesday. (Photo: BSA)

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 has issued an Open Letter to Victims, which can be read online, and will run as a full-page ad in USA Today on February 19.


"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 compensation to all victims while maintaining the BSA's important mission," he added.


Scouting programs will continue during the BSA's bankruptcy process and for many years to come, the organization says. Local councils are not filing for bankruptcy, as they are legally separate and distinct organizations.

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