Former Episcopal Treasurer Is Focus of Embezzlement Probe : Finances: Auditors are investigating suspected misuse of ‘many thousands of dollars’ in church funds at national headquarters, spokesman says.

The Episcopal Church has opened an investigation into possible embezzlement at its national headquarters in New York by its longtime treasurer Ellen Cooke, who resigned last month.

The Most Rev. Edmund Browning, presiding bishop and primate of the 2.5-million-member denomination, said Cooke’s staff had “discovered evidence of certain irregularities in the management of the church’s financial affairs.”

Church spokesman Jim Solheim told The Times that auditors have just begun to look more closely at the books. “No one can put a dollar figure on it yet until we get into it,” he said. “But the evidence points to very questionable personal use of church funds.

“We’re not talking about petty cash,” he said. The sum in question is “certainly in the many thousands of dollars.”

Browning, the nation’s top Episcopal official, told a meeting of the church’s Executive Council on Wednesday that an internal investigation is under way to determine the scope of the problem.

“Though our picture is fragmentary, and an investigation is only beginning, we already have something very painful to deal with: Funds appear to have been misused,” Browning told the council at a meeting in Providence, R.I.

Cooke, who served as national treasurer for nine years and earned more than $120,000 per year, resigned in January to follow her husband, Episcopal priest Nicholas T. Cooke III, from a parish in Montclair, N.J., to his new position as rector of a new parish in McLean, Va.

Church officials have spoken with Cooke and her husband, Solheim said, and there is a question now whether he will be installed as rector.

Tim Wittlinger, a Birmingham, Mich., attorney and a member of the council’s Administration and Finance Committee, said the probe focuses on the possibility that Cooke used church money for personal use.

The alleged financial scandal comes only weeks after two other controversies rocked the New York-based Episcopal Church.

Last month, shortly after Bishop David Johnson of the Diocese of Massachusetts committed suicide, the church disclosed that he had sexually exploited several women in extramarital affairs.

And this month, 10 bishops asked that the retired bishop of Iowa, Walter Righter, be tried within the church on charges of violating Episcopal doctrine for ordaining an openly homosexual man.

Wittlinger said the church began investigating Cooke after she sought compensation for approximately $90,000 in unused vacation and sick leave. Cooke allegedly failed to document the compensation claim, Wittlinger said.

John Carrico, a senior partner with Carrico Associates of Wayne, N.J., the firm that handles church accounts, said most of the money in question appears to have been drawn from a fund that was outside the purview of the firm’s annual audits of the church.

“It’s too early in the investigation to say what the scope of the problem is,” Carrico said. “On the surface, it seems to be a substantial amount.”

After the alleged irregularities came to light, the Episcopal Church hired the accounting firm of Coopers & Lybrand to investigate.

“The accountants swept through the building (New York headquarters) . . . and went through the books” Wednesday, Solheim said. “Until the accountants actually finish their work, we won’t know the full extent.”

Browning said he confronted Cooke at a meeting in Virginia on Feb. 9, two days after he learned of the alleged irregularities.

Church officials said the denomination decided to go public with the announcement, even though the investigation is in its early stages, as part of a commitment to be more open about Episcopal affairs.

“We are trying to communicate to our people that those of us who are (fiscally) responsible are taking the necessary steps to get to the bottom” of the alleged financial misuse, said Bishop Don Wimberly of Lexington, Ky., who worked with Cooke for years in his role as chairman of the Administration and Finance Committee. “We don’t want this to damage the mission of the church.

“We had assumed that all . . . kinds of safeguards were in place,” said Wimberly. Now, he said, the Administration and Finance Committee will review its financial procedures.

Wimberly said he hopes that the Episcopal Church comes out of its recent turmoil a stronger church.

But Roger Boltz, associate director of Episcopalians United, a conservative faction that is often at odds with the denomination’s leaders, said he believes the recent string of news about alleged financial mismanagement, sexual misconduct and homosexual ordination provides Episcopalians with more reason to believe the church “doesn’t stand for anything.”

“It just enhances the perception that the church is not helping people build Christian character,” Boltz said.

“The church has to set standards and hold people accountable to those standards,” Boltz said. “There’s a growing sense the church has been cut loose from its moorings.”