Archive for Thursday, June 24, 2010

Kansas Athletics board may get outside help in wake of ticket scandal

Bernadette Gray-Little spoke of the changes the athletic department was implementing in ticketing.

June 24, 2010, 11:47 a.m. Updated June 24, 2010, 2:47 p.m.


— Lew Perkins may soon have company in the leadership ranks at Kansas Athletics Inc.

KU Chancellor Bernadette Gray-Little has agreed to consider adding outside members to the board of directors for the university’s athletics department, a change she has discussed with her own bosses on the Kansas Board of Regents.

Gray-Little told regents Thursday that she wants to be sure that the board at Kansas Athletics Inc. — and boards for other organizations affiliated with the university — has “the kind of membership that can provide the guidance that’s needed.”

The department’s current board has six members, led by Perkins as athletics director and including only others who are on the university’s payroll: the provost, student body president, a vice provost, the faculty athletics representative, and the university’s chief business and financial planning officer.

Regent Ed McKechnie said he would welcome outsiders’ perspectives, noting that it takes “a very special person to be both a CEO and a chairman of the board,” and that “we ought to separate those powers” at Kansas Athletics.

“You want to have a board pushing and challenging, versus one just to bring forward recommendations to approve. I think this (change) makes a lot of sense.”

Gray-Little’s appearance Thursday before the regents came as Kansas University continues to grapple with the fallout from a ticket scandal that already has led to the resignation of five department employees and one paid consultant, all of whom have been implicated by a university-sponsored investigation blaming them for stealing up to $3 million worth of basketball and football tickets that were in turn sold for personal gain.

A federal investigation remains ongoing, one that has involved the IRS, FBI and the U.S. Attorney’s Office. And Athletics Director Lew Perkins has agreed to retire at the end of the next academic year, as he works to clean up the ticket mess and also deal with his own report that he’d been blackmailed by a former employee — a report that has led to a possible ethics investigation surrounding his acceptance of $15,000 worth of loaned exercise equipment used at his home.

Regent Gary Sherrer, who would be elected regents chairman later in Thursday’s meeting, reminded Gray-Little that she had “inherited” the ticket problems at KU.

Gray-Little acknowledged the problems, a day after regents had conducted her one-year job review.

“This will make me think twice about how happy one should be about inheritances,” she told regents, mustering a smile amid laughter in the regents meeting room.

Added Jill Docking, a broker who stepped down Thursday as chairwoman: “Well, that was just the estate tax you just got.”

Gray-Little told regents that the university had filed a claim with its insurance carriers, seeking to recoup some of the money lost when nearly 20,000 regular-season tickets for basketball and football games were stolen during the past five years.

The university also is moving forward with plans to hire a forensic auditor to heighten oversight of athletics operations, she said, given that previous reviews by outside auditors had failed to uncover the problems.

“It’s clear that a regular-type audit was not adequate,” she told regents.

Gray-Little said she would expect to have all recommended changes in systems and additional safeguards against fraud in place within three months. Regents instructed her to present them with another report in September.

Sherrer, a former lieutenant governor, said that Gray-Little was “on the right track” in addressing the problems in athletics.

But she’ll need to work hard on changing the culture within the department, he said, one that allowed thefts to continue for years, apparently without anyone willing to do anything to stop it.

“You have to have the right procedures, and you have to create the right culture,” Sherrer said, during a break in the meeting. “And you have to have the right governing group. I think she’s recognized that. Now, the test is: Will this happen soon?”

Sherrer, and his fellow regents, will be looking forward to the next report.

“We’re not dropping the issue,” he said.


nekansan 7 years, 10 months ago

How about suing the existing audit firm for the poor quality audits?

opobserver 7 years, 10 months ago

"Considering" suing? From what other employer could you steal this much, and they would "consider" suing you? And why hasn't the law gotten involved in this? Those involved would be sharing a cell with Freeman.

Phillbert 7 years, 10 months ago

I'm sure the lawyers won't let them say anything more than "considering" until the paperwork filing the lawsuit is at the courthouse. There's no way they won't sue.

areyouserious 7 years, 10 months ago

"considering"????? what is there to think about? sue them for the amount that would have been required by the williams fund in order to obtain those tickets!!!! plus damages and legal fees.......otherwise all williams fund donors lose in this situation.

fargo 7 years, 10 months ago

good luck collecting...some of these people will be behind bars

kansasredlegs 7 years, 10 months ago

Lost money for "FREE" tickets? Seems these tickets only miracuously had value when someone other than KU received some 'scrilla for them. The only collecting on this will be the IRS for failure to report the income.

Richard Heckler 7 years, 10 months ago

If people have been lying under oath things could get serious....

Lawrence KUAD and other crooks from the Lawrence building industry get around...

happyrock 7 years, 10 months ago

Who is on the KU Athletic Board? Where was their oversight?

wmathews 7 years, 10 months ago

The KAI board consists of Lew Perkins, the current student body president, Theresa Gordzica (secretary/treasuerer) , Danny Anderson (provost), Jerry Bailey (faculty rep) and Marlesa Roney (vice provost). Jeffrey Vitter will take Danny Anderson's place when Vitter becomes provost and Anderson becomes dean of the College of Liberal Arts and Sciences on July 1, 2010.

The easiest way to find out who is on the board is look at KAI's Form 990 and fill in the blanks with the current human in that position. This form is from 2008, so it's not quite accurate:

weeslicket 7 years, 10 months ago

hmmm. stating factual information. very dangerous.

KEITHMILES05 7 years, 10 months ago

Hopefully the FBI and IRS will be taking these culprits to court. If KU can't do the minimum of taking legal action then this entire deal is FAIL.

Richard Payton 7 years, 10 months ago

A few folks trying to ruin the good name of Kansas University for their greed. Much like Madoff and his greed.

4everahawk 7 years, 10 months ago

It is just damned pathetic that with the already overstaffed athletic department, they are going to hire someone else to make sure this doesn't happen again. Instead of promoting a staff member who knew the crap was going on, why didn't they take the opportunity to hire someone from the OUTSIDE to manage the ticket office????

KUGranny 7 years, 10 months ago

This goes beyond belief. First they scalp the tickets and make millions and KU looks criminal, unethical and low-class. Now they say they are considering suing. These are felons, what possible reason would they have for not prosecuting. By not prosecuting they are indicating the school knew about what was going on and looked the other way (in my opinion) and are afraid of what could come out in testimony implicating others (Sweet Lew). And our school looks even moronic. Somebody's head needs to roll.

wmathews 7 years, 10 months ago

Criminal charges can only come from a government body with jurisdiction (in this case it could be state or federal charges). A lawsuit comes from an aggrieved party/victim (in this case KU, a donor who can prove they were wronged in the whole situation, etc.) The goal of a civil lawsuit is usually a cash payout to the victim, while the end result of criminal charges would be jail time.

weeslicket 7 years, 10 months ago

what is with this wmathews coming in here and stating facts and good sense to people? what is with that?

KEITHMILES05 7 years, 10 months ago

The chancellor is the last line of defense in this sorry mess. I was hoping for a much stronger attack. I agree hiring yet ANOTHER high priced KUAC person only shows a weak hand.

I also sincerely hope she will NOT hire anybody who is currently in the KUAC as the permanent director. There needs to be cleaning house of this extremely top heavy and attitude laden bunch. They have failed KU and every segment they serve with their pompous and entitlement attitudes. They have brought shame to KU in every respect. The problem has been hardly ANY of the top dogs are KU people. They are driven by success and MONEY. This is what we as a university get for such arrogance and filth.

Slowly but surely the chancellor needs to demand that heads roll. I suspect within a couple years ALL the top people will be gone. It's going to take a long time to regain trust and respect, if ever.

Frightwig 7 years, 10 months ago

"They are driven by success and MONEY."

Success and money? Oh the horror! I suppose it's smarter to hire business leaders who are driven by failure and bankruptcy.


dubujg 7 years, 10 months ago

Seems to me that if Big Lew does not to discover this scam being perpetrated under his considerable nose for at least 3 years he either (1) knew about it and chose to do nothing, or (2) he is completely incompetent .....either way he is apparently either dishonest or extremely lazy (rather than driven) and should be shown the door immediately.

fan4kufootball 7 years, 10 months ago

Not only does the forensic auditor need to be completely independent (which means they cannot be an employee nor relative of an employee of KU or KU Athletics nor a member or a relative of a member of the Williams Fund) there also needs complete transparency in the seat selection in both Allen Field House and Memorial Stadium. Complete transparency would mean there would be a list of all the seats with the names of people who "own" those seats for that particular season and what their priority point ranking is within the Williams Fund.

independent_rebel 7 years, 10 months ago

Good ideas. Let's see who gets what seats and why. Of course, I believe the best seats (floor level, surronding the court) should be reserved for the students instead of the whine and cheese and early-leave types.

Bob_Keeshan 7 years, 10 months ago

Is it not worth reporting that the board had additional members at one time, and the additional members were discarded for legitimate reasons?

This would be a "change," this would be a reversion.

It should not be reported as some novel idea. Did Dolph help write this?

Richard Heckler 7 years, 10 months ago

That leaves our local Chamber of Commerce leadership out.

It is loaded with locals from the building industry and their legal counsel.

camper 7 years, 10 months ago

It is good that the Chancellor is promoting these changes. But realistically you can never totally prevent corruption. Corruption is the oldest occupation known to man. Strengthening internal controls and auditing activity will help, but crooks will always find a way to get around this. The most effective deterrent may actually be law enforcement. Jail bars are a lot scarrier than an auditor in a suit. If nothing else, this will lower the number of people willing to take the gamble. After all, most people are honest, and it is only a select few who can live a life not worrying about looking over their shoulder. Protection of whistle-blowers and a few well placed sting operations should be considered as well.

opobserver 7 years, 10 months ago

If KU is filing an insurance claim to collect some of the funds, I would find it strange that that same insurance company isn't pressuring the feds to file charges. The chaos in the dorm happened in April - and the sentencing has already occurred. This scam has been going on according to some reports since 2002 - to the tune of over 3 million, yet no indictment? Does anyone know what is going on here? All you ever hear is "they no longer work for KU". So that does mean they are just going to shove it under the rug and let them move on to another university and another six figure salary? They should be sharing a cell with Freeman. Anyone in agreement?

Jeremiah Jefferson 7 years, 10 months ago

How about just putting KU on probation for violating NCAA regulations regaurding ticket sales and accepting inapropriate funds. Id say 2 years without a tourney appearance should be sufice.

Richard Heckler 7 years, 10 months ago

There is wayyyyyyyyyyy too much adoration for CEO's and BOD chairman.

After all they bring plenty of white collar crime to the news media. AND they don't like to keep americans employed.

Locally they are probably as corrupt as anywhere else.

Forget the glass house neighborhoods.

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