[Asia Economy Reporter Hyunwoo Lee] The Boy Scouts of America (BSA), embroiled in hundreds of lawsuits related to child sexual abuse, has filed for bankruptcy protection. It is understood that the bankruptcy filing was prompted by the astronomical increase in litigation costs and victim compensation payments, deteriorating financial conditions, and a sharp decline in new members.
According to foreign media including NBC News on the 18th (local time), BSA submitted a bankruptcy protection petition under Chapter 11 of the Federal Bankruptcy Code to a Delaware court on the morning of the 18th. A BSA spokesperson stated in a press release that day, "We have two important goals: to fairly compensate those harmed during scouting activities and to continue operations for the next several years," and announced plans to establish a 'Victim Compensation Trust.' In the United States, companies filing for protection under Chapter 11 of the Bankruptcy Code can avoid immediate liquidation and attempt reorganization while continuing operations under the supervision of the bankruptcy court.
The total debt listed in BSA's bankruptcy petition ranges from $500 million to $1 billion (approximately 595.2 billion to 1.1905 trillion KRW), with estimated assets between $1 billion and $10 billion. However, most of the federation's assets are independently owned by local chapters nationwide rather than the central headquarters. According to 2018 tax records, the central headquarters owns real estate valued at $240 million. Following this bankruptcy filing, all civil lawsuits filed against BSA will be suspended.
Earlier, in April last year, court testimony revealing widespread sexual abuse of child members within BSA over 72 years since 1944 caused a major scandal. More than 7,000 BSA leaders were expelled on charges of sexually abusing affiliated child members, and the number of victimized child members is reported to be around 12,000. Since then, starting in August last year, BSA has announced that it is investigating over 120 cases of child sexual abuse within the organization and identifying additional perpetrators.
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