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Episcopal Church Holding Retirement Accounts 'Hostage,' Breakaway Diocese Alleges

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  • diocese
    (Photo: Jim Lewis of SC Diocese)
    The office for the Episcopal Diocese of South Carolina, whose leadership decided to leave The Episcopal Church in 2012.
By Michael Gryboski, Christian Post Reporter
June 4, 2013|6:00 pm

A diocese that recently voted to break away from The Episcopal Church has alleged that the denomination is "holding hostage" the retirement accounts of over 80 lay employees.

The Diocese of South Carolina alleged that The Episcopal Church's insurance entity, the Church Pension Group, is refusing to allow lay employees to roll over their 403B plans. The Rev. Canon Jim Lewis, spokesman for the Diocese, explained to The Christian Post, "Similar to a 401K, a 403B is a tax-advantaged retirement account available for employees of non-profits or educational institutions.

"There are currently over 80 lay employees of the diocese and our parishes whose retirement savings are held in a 403B account controlled by the Church Pension Group. The Episcopal Church is not allowing these employees to roll their funds over to another qualified plan of their choosing."

The South Carolina Diocese also provided The Christian Post with an email "paper trail," showing the correspondence between the Church Pension Group and the diocese.

The correspondence, which began in March and appears to have concluded in mid-April, involved Assistant Treasurer and Diocesan Administrator Nancy J. Armstrong requesting that the CPG allow for Fidelity to process rollovers for South Carolina Diocese employees.

The last response apparently given to the diocese was on April 17 by Frederick J. Beaver, senior vice president for Pension Services at CPG. Beaver wrote that a reply for Armstrong's query would take time due to the need to seek legal counsel over the matter.

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Neither The Episcopal Church nor the Church Pension Group returned comment to The Christian Post by press time. However, a statement on the CPG's website talks about the issue regarding the South Carolina Diocese.

"Due to the complexity of the current situation, we are working through proper channels to make sure this happens for participants in our plans who are employed by parishes and institutions whose leadership has terminated their affiliation with the Episcopal Church," reads the statement in part.

"In doing so, we are following protocols required by the Internal Revenue Code to avoid any adverse consequences for the participants in the plans. We expect to complete this process shortly."

Last year, the South Carolina Diocese leadership announced their intention to leave The Episcopal Church due to theological differences and the treatment of their bishop, the Rev. Mark Lawrence.

In November 2012, at St. Philip's Church in Charleston, the diocese voted to amend their governing documents to finalize their departing The Episcopal Church.

By January, the diocesan leadership and The Episcopal Church found themselves in court battling over the rights to the property and name of the Diocese of South Carolina.

Lewis of the Diocese told CP that the issues surrounding the 403B plans came after the diocese formally disassociated from The Episcopal Church.

"We know that, prior to this year, individuals were allowed to roll over their retirement savings into other accounts. This new prohibition only began this year, after the diocese disassociated from The Episcopal Church," said Lewis.

According to Lewis, later this week oral arguments will be heard over the suit between the breakaway diocese and the liberal denomination it left.

 

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