Boy Scouts Declare Bankruptcy

Boy Scouts Declare Bankruptcy

According to scouting.org, (in a page welcoming and inviting boys to join the Boy Scouts of America) the organization describes themselves as being about “adventure, family, fun, character, leadership and so much more.”

However, a wave of information recently resurfaced to the public eye, as the Boy Scouts of America filed for bankruptcy and Chapter 11 protection (Mike Baker, NYC TImes, 2020). The reason? To protect the organization from the consequences of sexual-abuse claims.

Many companies file for bankruptcy as a way to avoid the negative consequences of potentially criminal allegations. Although this at first may seem like they are, perhaps, abusing the system, Bankruptcy laws were created for exactly this purpose. According to econlib.org, the purpose of bankruptcy laws are to protect individuals and organizations from an overwhelming burden of debt, and to encourage the growth of new economic-contributing firms by giving them a “safety net,” saving them from falling into complete liquidation or failure, for any reason whatsoever. With this information, along with the fact that the number of filings for bankruptcy have increased five-fold in two decades, it is safe to assume that it was necessary for the Boy Scouts of America to seek this option.

Being under fire for sexual-abuse claims can tarnish the Scouting organization both in the public eye and economically. As to Chapter 11 protection in particular, according to investopedia.com, to put it simply, is a last-ditch option for debtors to reassess and reorganize assets, debts, and the sorts. Chapter 11 protection, also, comes with the provision of debtors “starting fresh.”

In this case, the debtor is the Scouting organization. As good as this might seem for them, it is the most expensive bankruptcy option, and, again, it is a last-ditch option, made after “careful analysis and consideration of all other options” (Maya E. Dollarhide, investopedia, 2019), so it still has caveats.

What isn’t new are the sexual-abuse claims surrounding the Scouts. They have been a thing through almost the entire existence of the organization. According to a 1935 NYC Times article, the Scouts have had an archived list of past leaders that have been labeled as either “degenerates” or “perpetrators.” According to another NYC Times article made in 2019, since 1944, nearly 8,000 Boy Scout leaders have been accused of sexual misconduct or abuse. In the same article, the Scouting organization has actually fought in court, multiple times, to keep records and files detailing information of such claims and suspect names private and away from public eye.

We have discussed what it means to file for bankruptcy and the reasons why the Scouting organization chose to file, but this leaves one question: Where will this lead them? To put it simply, no one currently knows. Only time will tell what all of the results will be. It is up to the courts and the Scouting organization to decide what actions will take place. In an email letter sent to participants’ parents, it is stated that the organization intends to continue for “the years to come.” They also state that safety is of top priority to them and they will continue to search for ways to improve safety. Knowing their good intentions, all other things equal, the only thing we can do now is wait for what becomes of this.