The Fiesta Bowl is fighting for its BCS life after the full scope of the bowl's corruption under ousted CEO John Junker dominated Tuesday's headlines, and it has essentially one chance to hold on to its favored status: Pin it all on the boss.
And there is more than enough to pin. According to the 284-page internal report the bowl dropped on Tuesday, Junker a) Instructed bowl employees to make specific political contributions, and illegally reimbursed them with bowl funds; b) Paid to take politicians on expensive out-of-town junkets and hosted fundraisers at the Fiesta Bowl museum; c) Intentionally covered up both reimbursements and fundraisers as potential violations of the bowl's legal nonprofit status; d) Expensed strip club visits, out-of-town parties, thousands of dollars in gold coins, personal and family trips, multiple golf club memberships, employee gifts and more on the bowl's tab; and e) Using bowl funds to effectively provide the startup capital (totaling $351,000) for a security company run by a friend in the Maricopa County Sheriff's Department. That guy is 100 different varieties of toast.
But the report also makes clear enough that Junker was not a one-man, rogue corruption band. If it plans to refute a wider, systematic pattern of corruption, it's going to have to explain away plenty of other allegations of lying, cheating, stealing and white-collar back-scratching willingly executed by ranking players other than the CEO:
? Employees were coached to lie. In response to the initial Arizona Republic article alleging illegal campaign contributions in December 2009, a public relations consultant/legislative lobbyist on retainer with the bowl, Gary Husk, suggested the bowl launch its own investigation headed by former Arizona attorney general Grant Woods ?�for whom Husk once served as chief counsel. Husk then inserted himself as a "liaison" between Woods and bowl employees (all of whom claimed they didn't realize the reimbursements were illegal until they read the Arizona Republic article), prepared a list of questions and hand-picked which employees would speak to Woods. Husk also set up brief meetings with six employees who had made campaign contributions and instructed them on how to phrase answers in interviews with Woods and to simply lie about being reimbursed.
This is why Woods' initial inquiry came back marked "nothing to see here" in January 2010. (The Arizona Secretary of State's Office didn't buy it and decided to start digging deeper in late January 2010; Woods later described the initial inquiry, lasting about a week, as a "seat of the pants" review conducted on short notice, which is probably the most charitable interpretation.) But it wasn't until almost eight months after the Woods-Husk report had wrapped, in September 2010, that one of the employees informed board chairman Duane Woods (no relation to Grant) that the board had been "snowed" and a new internal investigation commenced.
? Documents were altered. Chief operating officer Natalie Wisneski told investigators that (in addition to being coached to lie) she was instructed by Husk to alter checkbook entries to provide alternate explanations for bonuses paid to reimburse campaign funds. Wisneski and another employee both claim Husk also asked them to destroy evidence of spreadsheets that recorded the bonuses, though they apparently did not.
? Way more junk was expensed. Before his exit in 2005, former chief operating officer Doug Blouin charged the bowl for hundreds of dollars' worth of golf lessons, more than $13,000 worth of golf balls (!), family trips to the Macy's Thanksgiving Day Parade and a resort in the Bahamas, a $1,000 bottle of wine and an "18-karat white gold diamond heart shaped pendant suspended on a snake-style chain" reimbursed at $8,410.18. (The report notes, helpfully, that Wisneski "could not come up with a reason for the Bowl to pay for a heart-shaped necklace on January 16, 2003.") Blouin eventually "resigned" by skipping out on a scheduled evaluation by Junker, notes for which cited Blouin's "poor performance, lack of respect for company rules, obtaining an American Express Black card (with a $2,500 annual membership fee charged to the Bowl), and a general 'fail[ure] to live up to normal standards of trust and leadership in our business.'"
? The Board of Directors awarded no-bid/single-bid contracts to the company of a board member, through that member. Board member David Tilson (who served as chairman of the board's executive committee in 2008) is a vice president of Renaissance Companies, a Scottsdale-based building contractor hired by the Board of Directors on four separate occasions since Tilson became a member in 2005, for jobs amounting to $2 million. Conveniently, Renaissance's first job for the bowl ?�reducing the square-footage of the bowl's office building at the city's request to make for a light rail track, rendering the remaining office space inadequate ? led directly to the second: Remodeling a larger building, purchased from the city, to house offices and a first-floor museum, at the cost of $1.3 million. (Another former chairman, Ellie Ziegler, offered to buy the naming rights to the museum the same night the project was approved.)
None of the contracts were bid on by any other company. The most recent job, a patio to celebrate the bowl's 40th anniversary, was initially budgeted at $100,000, but later approved by the board for $300,000.
? Fraud went unreported. The bowl's auditor reported that "approximately $10k in fraudulent checks were issued and cashed" by a former employee, who was later paid $41,574 gross under her separation agreement last April. The bowl never reported the matter to law enforcement.
Aside from even the more damning specifics, though, the really big question is, why was the board so (apparently) clueless for so long? At one point last summer, chairman Duane Woods called the Arizona Attorney General's investigation "a waste of time." A former board member, Bill Peltier, told the Arizona Republic that being on the board was "a hell of a party" for football fans who enjoyed traveling and socializing, and didn't concern itself with seriously scrutinizing finances or day-to-day operations. "[Junker] never was held accountable for anything because the board never functioned like that," Peltier said. "No one ever stood up to him. … There was a slogan that one of the guys coined. He said, 'When you became chairman, you became Junkerized.'"
Appropriately enough, the entire operation seems to have become 'Junkerized.' And if the BCS is serious about its pledge that it "will not be associated with this kind of behavior" ? even if the BCS created the incentives for this kind of behavior in the first place ? it may well be on the verge of costing the game its meal ticket.
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Matt Hinton is on Twitter: Follow him @DrSaturday.
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