Monday, April 11, 2011

Fiesta Bowl: More Sad Stories

by Gary Snyder

If you can believe it, there is more on the Fiesta Bowl front...and it is not good.
With the out-of-control spending and improper practices that led the Fiesta Bowl to fire its top executive, a recent internal report on influence-peddling and spending abuses suggests that at least some board members neglected their duty of care, ignored warning signs and failed to impose checks or balances that might have prevented the scandal.
On page after page, the report describes key board members overlooking or even taking advantage of the bowl's lax controls. The report documented numerous instances in which individual board officers turned their backs on possible abuses or conducted business with apparent conflicts. Many of the failures involved financial practices.
According to investigators, the Fiesta Bowl had no rules requiring advance board approval for expenses and barely any system to verify billing claims. Even though board members believed much was "excessive" and "had absolutely no business purpose," they attended events and never challenged the expenditures.
Board members also received repeated warnings about unlawful political activity. One chairwoman was warned that the Fiesta Bowl employees were reimbursed for political contributions and a cover-up was under way and she did nothing.
The Fiesta Bowl adopted conflict-of-interest policies, but they were not enforced. The construction company of a former chairman in 2008 obtained four Fiesta Bowl contracts worth over $2 million without having to compete for the business. Another former board member and chairman received $5,000 per month to serve as liaison between the Fiesta Bowl and the Bowl Championship Series. There was no written contract. The report says two other board chairs authorized the agreement.
Don Meyers, a Fiesta Bowl founder and critic of the current board, says: "They didn't ask enough questions," Meyers said. "The excuse that we didn't know isn't sufficient."
Some board members are comfortable that current leaders are doing everything they can and should to repair the organization. This sounds quite similar to the fiasco at the Smithsonian Institution.
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