Kansas Athletics Inc. knows it lost $1 million to $3 million, and maybe more, when at least six of its employees stole more than 19,000 tickets for football and men’s basketball.
What KU officials don’t know is how much of that money they’ll be able to get back.
“Nothing has changed,” said university spokesman Jack Martin, noting that the university’s intentions to seek financial compensation had been disclosed months ago. “We will pursue appropriate legal avenues to recover money from the tickets these individuals diverted.”
Now that six former employees have admitted their guilt in federal court, and four have agreed to jointly owe $2 million in a “monetary judgment,” attention is starting to turn toward just how the university and its athletics department might be made whole.
The short answer: They can’t. There’s no way to tell precisely how many tickets had been stolen, nor for how long, although an internal investigation conducted for the university estimated losses at up to $3 million.
The longer answer: The university and the department have options for getting at least some of the money back, even if they haven’t decided yet whether or how to pursue them.
“It is us, as Kansas Athletics, that will have to go after the restitution,” said Jim Marchiony, associate athletic director for external relations. “As soon as the courts decide everything, as soon as that process plays through, we will then determine what our next step is going to be.”
One step already is being taken: seeking coverage from a $250,000 insurance policy taken out by Kansas Athletics to protect against employee theft. The department filed a claim in October, and is awaiting a ruling.
“That is something we are pursuing,” Marchiony said.
Seeking repayment through the federal judicial system remains an option, although university officials remain uncertain about their prospects.
First off, the judicial process has not yet concluded. While six defendants already have pleaded guilty — and a seventh, Ben Kirtland, former associate athletic director for development, is scheduled to plead guilty Feb. 24 — none has been sentenced.
The four defendants who already have pleaded guilty to conspiracy to commit wire fraud also have agreed to be jointly responsible for a $2 million monetary judgment, but no such judgment can be imposed until U.S. Judge Wesley Brown rules on sentencings. Those are set for various dates in March and April.
As part of their plea agreements, the four guilty conspirators — Charlette Blubaugh, Tom Blubaugh, Rodney Jones and Kassie Liebsch — have agreed to forfeit assets gained through the tickets scam, and have agreed to submit to lie-detector tests, if necessary, to help identify undisclosed assets. Liebsch already has given up the 2008 Camry she’d purchased using cash gained through the sale of stolen tickets.
Any decisions about how much Kansas Athletics or Kansas University might be able to claim remains to be determined.
“The judge decides how much restitution is due to the victims,” said Jim Cross, a spokesman for the U.S. attorney’s office in Kansas. “The judge also decides the amount of forfeiture.”
Then there’s a matter of collecting on such claims, even if approved by a judge.
Richard Hathaway, the assistant U.S. attorney who has been prosecuting the conspirators, said after Jones’ plea Jan. 14 that when it came to forfeiture, KU would be eligible to apply for reimbursement through the Asset Forfeiture and Money Laundering Section of the U.S. Department of Justice.
Such proceedings could not begin until sentencings are determined.
And while the seven people identified through the university’s internal investigation — Jason Jeffries and Brandon Simmons are the others — either have or are scheduled to plead guilty in federal court, there’s been no word on whether prosecutors might be finished with their investigations. Hathaway consistently has declined to comment on such possibilities, and KU officials don’t plan on making any decisions until they have more information.
“We’ve been consistent, internally, not to try to project what might or might not happen,” Marchiony said. “We’ll just let the process happen and then decide what the next step is going to be. It’s impractical to try to project what’s going to happen.”