By ARTHUR JONES
NCR Staff
New York

Leaders of the prestigious and usually sedate Catholic organization, the Knights of Malta, have been engaged in a polite but bruising, three-month internal fight over the direction of the organization.

The struggle, outlined in correspondence obtained by NCR, provides a rare look behind the formidable facade of the organization, formally known as the American Association of the Sovereign Military Order of Malta.

Differences have pitted long-term association members, including some Board of Councilors members, against William J. Flynn, president since January 1996. Two members called for his resignation.

Tensions within the 1,200-member organization, known for its high number of Catholic business, political and legal notables, were reflected in an exchange prior to the Nov. 4 New York City semiannual board meeting.

In October Flynn, board chairman of Mutual of America, urged William E. Simon, former U.S. Treasury secretary and self-made multimillionaire, to resign from the board. Simon wrote back, “I will be pleased to resign -- right after you do.”

Concerns raised by some members prior to the Nov. 4 meeting included Flynn’s operating style, that he is “too busy” elsewhere to be a hands-on president, that more than 50 percent of the association’s income is now going to administration, that meetings are hastily scheduled to prevent full attendance, that charitable giving has shifted from Third World needy to the U.S. bishops, that there is “a self-perpetuating” board with no nominations taken from the floor and a “lack of open communications between board and membership.”

Some members expressed dismay that the association’s chancellor and chief operating officer, Henry J. Humphreys, held a position they say is expected to be voluntary, yet apparently pays a six-figure salary. Some were also upset that Flynn personally hired a $50,000 media consultant without approval of the entire board.

Flynn, named to succeed the Knight’s longtime president, the late J. Peter Grace in what is considered a full-time voluntary job, appears to have offended an important contingent of the association’s members who have long been involved in its charitable efforts. Two male members were particularly incensed at Flynn’s “mean-spirited and personal attack” on Cissy Ix, the association’s hospitaller (coordinator of association caregiving activities), who wrote an Oct. 15 letter to New York Cardinal John O’Connor outlining the group’s growing problems.

Ix told O’Connor, the association’s conventual chaplain, that President Flynn had sent only two letters to the members in two years and that those had been for fundraising; that married couples now have to pay $100 to attend the day of reflection with O’Connor (one member, she said, asked if Flynn will next charge for confessions). She told O’Connor that simple receptions could be substituted for fancy ones now held at the Waldorf Astoria Hotel and that because dues are being raised, potential members cannot afford to apply.

In her letter, Ix said that a new chancellor was named before the other was given notice. She also said that Flynn has ended the separate entity the knights had created for their $7.5 million foundation, a move she said would jeopardize restricted gifts and its fund management.

Only by limousine

She said that Flynn would attend a Boston area Mass and dinner with Boston Cardinal Bernard Law only if met at the airport by a limousine, and that Bob Reers, congratulated by Flynn for publishing the annual report each year, was five days later notified that his services were no longer needed.

The secretive knights are known publicly for their personal wealth, flowing black capes and social functions -- and at some times and in some circles for suspect political activities. But they also pride themselves for taking Holy Communion to the sick, for supporting Third World hospitals, and for their personal, hands-on involvement in local charities such as AIDS hospices, soup kitchens, hospitals and homes for unwed mothers.

Remaining apolitical was scarcely the American Association’s leadership style in the 1980s, when J. Peter Grace was president and had eight knights on the $4.9 billion W.R. Grace board. Grace was linked to many CIA-connected activities. One group of knights had direct or indirect links to the Central Intelligence Agency (NCR, Oct. 14, 1983) and CIA Director William J. Casey was himself a knight.

The approximately 15,000 worldwide members of the Sovereign Military Hospitaller Order of St. John of Jerusalem of Rhodes and of Malta was founded in the 12th century to protect pilgrims to Jerusalem. Its knights fought in the crusades, acquired land and wealth, and went through a series of historical successes and reversals down to the present day. Today the organization is diplomatically recognized as an independent entity, a “nation” of sorts, by some 40 countries, not including the United States.

Three Knights of Malta associations operate in the United States.

The New York City-based American Association, with some 1,200 members, including several hundred “dames” or female members, has area organizations in Boston, Chicago, Providence, R.I., Fairfield, Conn., St. Louis and elsewhere. The 550-member Washington-based Federal Association includes “the Old South” and Mississippi; the 550-member Western Association covers the remainder of the country. The latter two are the fastest growing associations. There was some suggestion that dissatisfied American Association members might transfer to the Federal Association where dues are half the New York-based knights’ $1,000-plus annually.

The dissatisfaction of some with Flynn is outlined in a series of initially very polite letters exchanged during the past 12 months.

In November 1996, for example, J. Pepe Fanjul, southeastern Florida area chairman, suggested to Flynn that his proposed bylaw changes, which, among other things, would alter board term limits, if adopted with less than unanimous agreement would result “in resentment and division within the organization.”

Resentment and division certainly followed the Flynn administration’s changes from a 35-member board to a 24- member board -- three groups of eight with limited terms. Flynn told NCR, “It used to be that members could serve unlimited terms, and some were on the board for 30 and 40 years. Many of us thought that was not a good way to do it, and of course you don’t win popularity contests when you take 11 people off the board and then have eight up every year for re-election,” he said.

In July Frances O’C. Hardart, Westchester County, N.Y., area chairman, wrote diplomatically to Flynn that she was “anxious to hear your thoughts on these issues,” which included questions on administrative costs such as the proposed office move to larger and more expensive space away from the Catholic Center (New York archdiocese’s chancery at 10ll First Ave.) and the presence of “four secretaries” in an office characterized by “a lack of written information to board members and area chairmen.”

In August three knights, Francis H. Ludington, Robert F. Callahan and Victor R. Coudert, praised Flynn for his Northern Ireland peace process work and his participation in the dialogue between Christians and Jews. But they also suggested that Flynn may have “overlooked the implications” of shifts in the association’s approximately $800,000 in annual giving. They recounted that 31 percent went to AmeriCares (needy Third World hospitals), 31 percent to the National Conference of Catholic Bishops, 23 percent to New York archdiocesan charities, nine percent to other dioceses, and six percent to charities elsewhere in the world.

More to U.S. bishops

The three knights asked: Why replace the reduced AmeriCares contribution with a similar one to the U.S. bishops? They said that while 80 to 85 percent of the American Association membership live outside the New York archdiocese, 72 percent of diocese-direct giving went to New York. More than the current six percent should be going to world charities, they said.

The three members were concerned that while the three U.S. associations had been asked to raise half the $20 million needed to support Holy Family Hospital in Bethlehem -- a campaign important to the grand master and the pope -- the American Association had not participated in the initial campaign, although the Federal and Western Associations had.

“Morale is at a low ebb,” wrote the knights, who spoke of the abrupt cancellation of the usually standing-room-only Caregivers Conference scheduled for last January and the ending of “the low cost social hour after the annual St. John the Baptist Mass.”

While the association needed a paid administrator, they said, that person should not be a board member.

“We would like to sit down with you,” they wrote. Six weeks later they again wrote to Flynn, saying he still had not replied to their letter, contacted them or returned their calls. The following week, Flynn offered to meet for lunch at New York’s fancy La Grenouille restaurant six days after the Nov. 4 board meeting. The three knights suggested that “quiet surroundings” such as the Princeton Club were more conducive to private in-depth discussion than a public restaurant. They said that if he would not meet prior to the board they would lunch Nov. 10.

Board member and lawyer Howard G. Seitz, writing of his concerns in September, assured Flynn they were “philosophical comments” and “not a personal attack.” Seitz disagreed with Flynn’s interpretation of the role of the board and cited New York state law to make his points.

Four days before the Nov. 4 board meeting, Seitz asked Flynn in a letter: “Do you believe that it is in the best interest of Malta and those whom we serve for you to continue as president?”

After the meeting, Seitz told NCR he believed the board session was “very positive” and he was particularly pleased with plans for a “leadership retreat” early in the new year for the new team.

Whether the retreat will smooth ruffled feathers remains to be seen. Going into the meeting, however, the mood had been set in part by the letter Hospitaller Ix wrote to O’Connor on Oct. 15 and the subsequent letter Simon wrote to Flynn on Oct. 17, expressing “substantial agreement” with her points.

Three days later Flynn wrote back to Simon asking him for his resignation from the board for supporting Ix’s “most distressing and disparaging attacks on policies set by the Malta boards as well as upon me personally.” The same date Flynn wrote to lawyer Seitz stating, “I have thrown up my hands at further attempts to respond to your continual barrage of criticisms, suggestions, etc. The amount of time you put into these efforts staggers the mind. My own agenda does not afford such a luxury.”

Simon replied to Flynn, “There is no place in the Knights of Malta for egotism and arrogance. This is not about Bill Flynn or Bill Simon; this is about our cherished association and our service to the Lord. Malta is what’s paramount here. Ordinarily, at any other organization, these concerns would be discussed in an open and rational way.”

Almost a year after his original letter, Pepe Fanjul wrote to Flynn that “Malta is a charitable organization and in my opinion should be run in a pluralistic way where opinions of the membership and councilors are freely expressed, discussed and given serious consideration.”

Lacking consensus

Wrote Fanjul, “To me, the test of consensus-building is simple: Success means unanimous votes. This is not happening now. In the past, the board always voted unanimously on everything. The meetings were not confrontational; they were run efficiently with a spirit of cooperation and a mix of seriousness and humor sadly missing today. We do not want the lack of morale at the board to permeate to the membership in general.”

In August last year, Flynn told NCR that “even a few of our own members seem to have the misconception that membership is really a reward for achievement in the business or professional world, or for generosity to the Catholic church and charities.

“The fact of the matter is,” said Flynn, “that service of the poor and protection of the faith have been two basic foundations of the knights from the very beginning. In all the positions I’ve held in business and with different boards,” Flynn said, “the only measurement of success I’ve ever used has been the effort and ability to really make a difference.”

He said he wanted to enlist more blacks and more women, “people who are known for their service to the poor.”

Protesting the manner in which the association is seeking publicity, Hardart, in her letter to Flynn, said, “I feel I must mention my embarrassment at the repeated mention in public statements of a search for African-American and Hispanic members. I cannot imagine that anyone we could invite to join the order would enjoy being a token or quota member.

“Having served on the Admissions Committee for a number of years, I am aware that we have admitted some very attractive African-American and Hispanic members and that the race of a candidate (even if we knew it) never enters our discussions. Perhaps the media consultant does not know or understand the qualifications for membership in the Order of Malta.”

On Nov. 5 Flynn told NCR there had been an “excellent four hour meeting” at which the board approved administration action plans for 1998.

Flynn said that decisions included plans to decentralize the operations around the United States to a greater degree. “We want to place much greater responsibility and authority in the hands of area chairmen and local people in each diocese” to develop “the various projects the Malta mission calls on us to do.”

More funds will be disposed of locally, he said. “Rather than have everything directed by one small grants committee, both international and national projects and causes, area chairpersons will take greater responsibility in deciding what we should be doing.”

Ten board committees -- finance, nominating and the like -- were named and a slate of officers was elected. Humphreys will remain as chancellor but has resigned as administrator; John Reiner, previously secretary, was elected hospitaller. Internal communications need “real attention,” said Flynn, because there was “a great deal of misunderstanding on a number of things, including how we spend our money, what for and who decides. All this has been clarified -- and the results were overwhelming, nearly unanimous, on these issues -- and I’m very happy about that.”

Of complaints of high administration costs, Flynn said there are many ways to run a not-for-profit, and that while there is an important role for volunteers, “you couldn’t run the Boy Scouts or Girls Scouts with only volunteers.

“When you have a 9-to-5 operation,” said Flynn, “that’s a full-time job (for an administrator) and we’re now looking for such a person.”

As for the high rental move, Flynn said that was a secondary issue, that the organization needs more room at a time that New York City rents are skyrocketing. Any future rent will suffer in comparison to the “very favorable rental from our present landlord (the New York archdiocese).”

However, he said, the entire board will vote on the budget and “what expenses we have or don’t have will depend entirely on board’s decisions.”

All Flynn would say to the question of Simon calling for his resignation was that Simon was not re-elected to the board. Simon was not seeking re-election.

On the issue of the exchange of letters and concerns of some members, Flynn said, it was “very damaging to Malta that people should release internal memorandums to the press. It is something that really isn’t done -- it’s considered a breach of responsibility. We haven’t tried to tag people with that because it gets awful messy. But you do that in a corporation and you’d be thrown out on your ear.”

He continued, “I would like to stress that one thing that characterizes Malta is very, very dedicated people. That leads to very strong opinions about how best to do something and there can be very strong differences of opinion,” he said.

“There was as close to perfect unanimity as one can hope for and I think we have a common sense of purpose and mission with all the questions that honest people raised answered fully,” he said.

Coudert seemed to agree. One of three knights who had written to Flynn, Coudert told NCR that best as he could gather from secondhand information after the board meeting, “most of our concerns have been dealt with satisfactorily.”

National Catholic Reporter, November 14, 1997

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