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Luis Rubio was arrested for improper conduct and sexual abuse of minors when he was in charge of a Las Cabras school in 2013.
A year later, the archdiocese of Rancagua dismissed him from his duties while an investigation was underway, with the results sent to the Vatican, which has now expelled him.
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Rubio's case was brought to the forefront in May when a television report revealed an alleged network of sexual abuse carried out by a group of religious figures collectively known as "The Family."
Rubio was interviewed in the report, during which he admitted he had "made a mistake, but not committed a crime."
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A total of 14 priests and other religious figures were suspended as the Church investigated the network, while Rancagua prosecutors also opened their own investigation.
Pope Francis in May accepted the resignation of five Chilean bishops amid accusations of abuse and related cover-ups. Meanwhile last week, prominent priest Oscar Munoz was arrested over allegations of sexual abuse and rape of at least seven children.
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