Florida priests 'embezzled $8.6m from parishioners'

Two Catholic priests in Florida stand accused of embezzling $8.6m (£4.6m) from their parishioners over a 42-year period and spending the money on holiday houses, luxury travel, gambling in Las Vegas casinos and secret girlfriends.

The scandal, at St Vincent Ferrer Church, in Delray Beach, north of Miami, cast yet another embarrassing spotlight on a Catholic diocese that recently lost two bishops to child sex abuse scandals.

According to police who investigated the suspect finances at St Vincent Ferrer for more than a year, Fathers John Skehan and Francis Guinan acted as "professional money launderers" who took money from the collection plate and set up a network of slush-fund bank accounts to which only they had access.

Fr Skehan, 79, was a highly regarded priest whose congregation included many prominent politicians and public figures in southern Palm Beach County. According to the police, however, he also used laundered money to buy himself a condominium near Delray Beach, a cottage on the Cliffs of Moher in Ireland and a pub in Kilkenny, where he was born. The police complaint says Fr Skehan spent $134,075 in church money on a woman described as his girlfriend, another $11,688 on family members, and more than a $250,000 on himself - for car payments, dental work, property taxes and housing fees, and credit card payments.

Fr Guinan, 63, a longtime friend of Fr Skehan who took over the parish in 2003, owns a string of properties in the area. The complaint said he was a gambler who spent lavishly in casinos in Las Vegas and the Bahamas. He was also alleged to have made cash payments to his secret lover, who once worked as a book-keeper at his old parish of St Patrick's in Palm Beach Gardens, and to have contributed more than $7,000 to the cost of the woman's son's education. He, too, racked up impressive dental bills. The complaint said he spent $15,000 of illicit funds on his teeth.

Fr Skehan was arrested on Wednesday night as he flew into Palm Beach airport from Ireland. Fr Guinan is believed to be on a cruise in Australia, although investigators said he was aware there was a warrant out for his arrest.

The alleged irregularities first became apparent when Fr Guinan took over from his friend in 2003 and the church conducted a routine audit. They did not bloom into a full-blown scandal until two years later, when a parishioner wrote an anonymous letter to the district attorney, urging him to become involved in the case when the church decided to cover up the results of its internal investigation.

Fr Guinan resigned later that year as the investigation deepened. State and local police continued to dig up evidence not only of gross financial malfeasance, but also attempts by the priests to cover up their activities. One church employee told police that she and her mother received greeting cards each containing $1,500 in cash after she refused to help the diocese with the investigation. Fr Skehan told her he was proud of her, she said, and offered to pay her legal fees "if ever needed".

The revelations left locals in shock, because they had regarded Fr Skehan as a pillar of the community. The mayor, the police chief and many local police officers are all parishioners at St Vincent Ferrer. That, in turn, appears to have fuelled a personal sense of betrayal and anger. "These guys lived the life they told everyone else not to live - and they lived it on everyone else's dime," a police spokesman, Jeff Messer, told the Palm Beach Post.

This is not the first financial scandal to hit the Catholic Church in the diocese. One priest was accused of embezzling $400,000 during the 1990s but agreed to pay back the money in exchange for the diocese's agreement not to press charges. One lawyer, Ed Ricci, said the lack of transparency in church affairs left priests open to temptation. "There's a long history, in my judgement, of them doing an atrocious job of auditing their finances," he said.