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A controversial bishop apologized yesterday to Catholics on Vancouver Island, confessing that he invested church funds in secret deals that have left the diocese struggling under a $17-million debt.

"I will work and pray, for the remainder of my life, if necessary, to help the diocese resolve this debt," Bishop Remi De Roo wrote in an emotional plea for forgiveness to the Victoria diocese.

"Accepting personal responsibility, I blame no one," he said in the two-page letter addressed to his successor, Bishop Raymond Roussin, and released publicly. "Even as I write this, I trust that the people will forgive me, humbly praying that my shortcomings will not impede the spiritual growth of others."

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It was the first time Bishop De Roo, 76, who retired after 37 years in the diocese last year, has commented on the financial scandal that first erupted more than two months ago.

"During this period, I have experienced anguish, bewilderment, confusion, sadness, guilt and self-blaming," he wrote, explaining his silence.

Bishop De Roo admitted he broke Catholic canon law in making the investments in the 1980s and 1990s without the proper approval from church authorities.

In February, parishioners were shocked to learn that a series of secret investments of millions of dollars of church funds were made in race horses and land in Washington state over the past decade.

The investments and loans have left the church with lawsuits in the United States and a $17-million debt, accruing at $7,000 a day.

Under canon law, a bishop can borrow a maximum of $350,000 without approval from diocese consultants. Anything over $3.5-million must be approved by the Vatican.

Saying he needed "to express myself from my heart," Bishop De Roo admitted it was his own "serious lack of vigilance" and "faulty decision making" that led to the church's financial crisis.

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"I acted in good faith," he wrote. "I am deeply saddened by what has occurred. I was ultimately responsible for all investments, including those made by my associates in diocesan administration."

"In the face of the huge, unintended debt which resulted from those transactions, it is extremely difficult for me to verbalize what I feel. I am emotionally shaken."

Bishop De Roo was unavailable for further comment yesterday. He has been lecturing in the United States and is currently in Manitoba at the church's Winnipeg diocese.

"It's a tragic end to an otherwise fine career," said his Victoria lawyer, Chris Considine, in an interview yesterday. "It's very sad. . . . He's a man who gave 37 years of his life to the diocese and is respected around the world."

Mr. Considine said it is unclear what impact the bishop's statement will have on a canonical inquiry appointed by the church to investigate the investments. The three-member inquiry is expected to make its findings public.

Bishop De Roo is a high-profile figure within the Catholic Church in Canada, known for his liberal and sometimes controversial views on issues such as ordaining women priests and allowing priests to marry.

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Bishop Roussin was not available for comment yesterday.

The bad investments stem from a $2-million loan that was made to a U.S. lawyer and developer, Joseph Finley, in the late 1980s to invest in Arabian race horses. The venture failed and Mr. Finley never repaid the loan. He later approached the diocese in 1997 with a plan to recoup the $2-million in a $12-million land deal in Lacey, Wash. The diocese signed a promissory note guaranteeing a $12-million loan for the vacant land that never sold.

The church was left paying $180,000 (Cdn.) monthly in interest payments.

None of the transactions was on the diocese's books. They were discovered only after the church defaulted on the monthly payments and was taken to court by a New York lending company. The land has since been ordered foreclosed in a $13-million court ruling against the church and is the centre of an appeal by the diocese's one-time partner in the land deal, Mr. Finley and a U.S. company.

The business relationship between Mr. Finley and the Canadian church remains unclear.

Bishop De Roo's apology comes as the diocese is asking Vancouver Island's 90,000 parishioners to buy bonds guaranteed by a mortgage on the church's estimated $63-million in assets.

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The diocese is seeking approval from the B.C. Securities Commission to issue the bonds in an aggressive campaign to pay down its mounting debt and its interest so it won't be forced to sell off its properties, including churches, schools, a hospital and vacant land.

Parishioners are being asked to buy the bonds at 6 per cent interest for three years. The diocese initially called for loans over three years at 3 per cent interest.

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