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Sex Abuse Scandal May Drive Boy Scouts of America to Bankruptcy

The Boy Scouts of America is considering filing for bankruptcy as the scope of a decades-long sex abuse scandal becomes clear.

A researcher for the youth organization, hired to analyze records from 1944 through 2016, said she has identified 12,254 victims of sexual abuse in the youth organization, along with 7,819 abusers. Critics say the actual number could be much higher, as many incidents were likely never reported.

That information has led to a spike in lawsuits against the Scouts and officials tell the Los Angeles Times they’re considering the Chapter 11 filing to halt the suits as they negotiate settlements.

“The BSA is considering options to determine how victims can be equitably compensated while the organization continues with its mission to serve youth,” the Scouts told the Times. “No decision has been made.”

Boy Scout officials also noted that the organization has dramatically enhanced its protective processes, including requiring a criminal background screening for potential leaders and volunteers. In 2018, just five cases of sexual assault were reported. There are around 2.2 million members in the Scouts.

The organization holds over $1 billion in assets, but there’s a fear that could be insufficient to shoulder what could amount to substantial legal losses. Insurers have refused to cover payouts, saying the organization could have done more to prevent the abuse. Scout officials did not say how many lawsuits have been filed.

Should the group file for Chapter 11, subsequent claims of abuse would be steered toward the bankruptcy courts as a creditor, rather than state courts.

It’s a move that has precedent. Some Catholic dioceses have filed for bankruptcy protection to avoid paying some judgments.