10/10/2012

Lambs & Wolves



THE LAMBS AND THE WOLVES

Dr. Charles E Hill Ed.D
Professor Emeritus, The College ol New Jersey
“Naming incites to money crimes like great poverty or great wealth. ' Mark Twain

INTRODUCTION

There is credible documentation for charges that many Pennsylvania officials, past and present, are unethical and in too many cases, corrupt. Governors, attorneys generals, judges, police, and FBI agents have been called into question. These revelations have serious implications for all who seek reforms at the Milton Hershey School. The situation in Hershey also helps to explain the Sandusky case in State College, Pennsylvania. In both cases, at risk children are likened to lambs because they are without powerful advocates to protect them from a harmful environment.

By now most of us are aware that LeRoy Zimmerman, former PA. Attorney General, is accused of corruption in the book by Keisling and Kearns entitled The Sins of Our Fathers. Yet, incredibly, LeRoy Zimmerman served from 2006 until December 2011, as Chairman of the $8 billion Hershey Trust left by philanthropist Milton S. Hershey for the education and care of needy children. PA Attorneys General are legal guardians of the Milton Hershey Trust; they have legal standing and authority to investigate and remedy the many problems at the Milton Hershey School. However, PA Attorneys General have been notably derelict in their oversight duties.

Documents indicate that cronies of Zimmerman, including former governor Tom Ridge, have been appointed to lucrative positions on the various Hershey Boards. Instead of protecting the Hersheys’ Trust for needy children these politicians are spending Trust money for their own purposes. Large sums of money and the unabated power of these well-connected politicians have provided fertile ground for improper use of the Hersheys’ legacy. The Hershey Trust for needy children has been turned into an entitlement program for the rich and sometimes famous. The interests of the Hersheys’ children are not being protected and they and their advocates have virtually no recourse. 

Financial irregularities and other wrong doing seem all too common in Hershey. While construction of new student homes and admission of more needy children to fill them were recently put on hold, MHS Trustees conducted inappropriate real estate deals to benefit themselves. Other wasteful expenditures included $ millions in compensation for Trustees and high salaries for MHS administrators lacking the necessary childcare competencies to be effective leaders. Meanwhile, the self-dealing Trustees and administrators disregarded the safety and well being of the students at MHS ( refer to 
www.philly.com to read Bob Fernandez‘s article in the Philadelphia Inquirer Child Porn Case led to Hershey School).

Indeed, the PA Office of the Attorney General has for years publicly claimed to be investigating the mismanagement and financial irregularities at MHS, yet the epic dysfunction and misuse of Trust assets there continues unabated. Child care advocates, including a group called Protect The Hersheys’ Children, and other concerned MHS alumni, have repeatedly requested the PA Attorneys General conduct a meaningful investigation of dysfunction at MHS, but to no avail. The records of the elected Attorneys General provide insight into the causes of their failure to conduct a proper investigation of Hershey Trust irregularities. The insights also include their failure to prosecute the Sandusky case in State College, Pennsylvania.

ELECTED PENNSYLVANIA ATTORNEYS GENERAL

LeRoy Zimmerman served as AG from 1981 to 1989. He was the first elected AG in PA. As AG, Zimmerman failed to investigate and charge Charles Koons, a pedophile in Hershey who was accused of molesting an MHS student in the 1980s. Koons remained free to harm more children until his 2008 arrest and conviction for sex crimes-- almost twenty years after he was first accused.

Zimmerman joined the MHS charity in 2002 with the support of then Attorney General Mike Fisher and became chair of several Hershey related Boards in January 2006. He chaired the Board of Managers of the Milton Hershey School and The Hershey Entertainment and Resort Company and he was a Board member of the Milton Hershey Foundation. According to IRS tax filings Zimmerman was compensated $500,000 through director fees on Hershey related boards in 2009. Compensation of this magnitude is uncommon for charitable boards and must be considered highly irregular for members of the Hershey Trust board.

During Zimmerman’s tenure as Hershey Trust Chairperson, Robert Reese, former president of the Hershey trust company and former member of the MHS Board of Managers, described widespread financial irregularities at the Hershey Trust in a Dauphin County court petition on February 8, 2011. Mr. Reese is financially connected to the peanut-butter cup fortune.

Mr. Reese’s 19 page court filing alleged that the Hershey Trust Board, led by LeRoy Zimmerman, used charitable assets illegally for free rounds of golf, spa treatments, limousine rides and excessive compensation. Reese claimed in court papers that Board members earned six-figure annual compensation for working an average of five hours per week. This Board also authorized a $67 million renovation to the exclusive Hotel Hershey, smugly referred to by Board members as “Zimm’s Palace.” These same Board members stay there for free, enjoying amenities fit for royalty. 

Twelve million dollars of Trust money, meant for needy children, was used by Board members to purchase the Wren Dale Golf Club so they could have free golf outings. The Trust Board paid far more for this golf club than it was worth, providing a financial bailout for cronies who had invested poorly in this property. Mr. Reese, as a Board insider, publicly proclaimed in his court petition the Hershey Board’s wrong doing which outsiders had been alleging for years. Robert Cavanaugh, MHS alumnus, Hershey Board member since 2002, and new Trust Board chairman, helped to make all of these asset misuse decisions. Cavanaugh, already a wealthy individual, was paid $300,000 in 2008 for being on two Hershey Boards according to IRS documents. He should also be held accountable for his role in these financial irregularities.

Mr. Reese was quoted in the Philadelphia Inquirer on February 11, 2011 as saying “he believed he had to file the court petition to protect the Hershey charity and that he had a legal duty to do so.” This protection is exactly what the PA Attorneys General are required to do by statute, but they have failed miserably at this responsibility. Although Mr. Reese later dropped his court petition, the allegations he filed in the Dauphin County court will continue to provide legal justice system investigators with vital information pertaining to alleged Trust Board irregularities. 

Reese claimed that failing eyesight prevented him from reading the myriad legal documents presented to the court by Trust lawyers. Apparently Reese decided he could not continue in the face of this withering barrage of legal paperwork from the high-powered lawyers hired to defend the managers of the $8 billion Trust.

Ernie Preate was AG from 1989 until 1995; His term ended prematurely when he was indicted on Federal charges for mail fraud and corruption. He served a sixteen month prison sentence in Duluth, Minnesota.

Tom Corbett served his first term as AG from 1995 to 1997. He was appointed PA Attorney General following the resignation of AG Preate. In late 1996, AG Corbett learned of an ongoing sex ring in York, PA involving Republican State Senator Dan Delp and dozens of other VIPs. According to York city officials, “AG Corbett intentionally crippled or otherwise bungled that investigation,” as documented by 
http://www.yardbird.com/tv_police_ch...e_sex_ring.htm and http://www.yardbird.com/tv_town_offi...e_sex_ring.htm.

Mike Fisher served as AG from 1997 to 2004. One of AG Fisher’s inappropriate activities led to his admission that he used improper pressure, in violation of his fiduciary duties, on Lincoln University officials to get them to approve moving the Barnes art collection to the Philadelphia Museum of Art (see The Art of the Steal, a 2009 documentary film). More importantly, he failed to investigate and prosecute pedophile Charles Koons even though his molestation of an MHS student had been reported to authorities in the late 1980s. Fisher further exacerbated dysfunction at MHS by his failure to replace self-serving Trust Board members with child care experts. Instead he continued the tenure of some Board members who were part of the problem and appointed non-child care experts to replace those removed from the Board. 

Mike Fisher was also the Attorney General when the inappropriate behavior of Jerry Sandusky, alleged State College, PA pedophile, was first reported by the victim’s mother to Penn State University police in May 1998. The Sandusky complaint was then referred to Ray Gricar, DA of Centre County, PA. Gricar initially assigned the case to Assistant DA Karen Arnold. Gricar took the case from Arnold after two or three days, saying he was going to handle it personally. No charges were filed by Gricar or Fisher against Sandusky. Ron Schreffler, Penn State police department investigator, helped produce a report about the 1998 Sandusky incident that was referred to Gricar. That report, although highly sought after, is missing. In fall 2000 and in March 2002, more incidents of sexual misconduct by Jerry Sandusky were reported. No charges, indictments, or arrests were made.
Jerry Pappert served as AG from 2004 to 2005. Pappert completed the unexpired term of Mike Fisher who was appointed to the US Court of Appeals. No charges were filed against Koons in Hershey or Sandusky in State College during Pappert’s term as AG.

Tom Corbett was elected PA AG in 2005 for his second term and he served as AG until 2011. On March 31, 2005, AG Corbett and DA Gricar held a press conference to announce the largest drug bust they had ever conducted in Centre County. Gricar pointed out that heroin and cocaine were problems that had been increasing throughout Pennsylvania. Two weeks later, Ray Gricar vanished and is still missing. His computer, with the hard drive torn out, was found in the Susquehanna River. There has been no serious investigation by the PA Attorneys General to find out what happened to Ray Gricar. Gricar’s replacement Michael Madeira cited a personal conflict of interest between himself and Jerry Sandusky so he referred the pedophile complaint to AG Tom Corbett in March 2009. Corbett did not prosecute the Sandusky case, apparently because of his political aspirations ( 
http://www.yardbird.com/joe_paterno_takes_the_fall.htm ).

On September 14, 2009 Corbett announced he would run for governor of PA. The “bonus gate” scandal became the core of Corbett’s political campaign. The Harrisburg Patriot News portrayed him as a corruption-fighting crime buster, rooting out state employed Democrats who were alleged to have either authorized or received state bonus checks for political activities--in violation of PA law. 

While AG Corbett was indicting his Democratic adversaries for “bonus gate” related activities, he was reportedly using his Republican AG staff for essentially the same kinds of politically motivated duties. William Keisling, ( 
http://www.yardbird.com/joe_paterno_takes_the_fall.htm ), alleges that a Republican deputy AG received a $20,000 bonus for his help getting Corbett elected governor. Additionally, when one of Corbett’s bonus gate targets was acquitted, AG Corbett diverted all his agents to perform background checks on approximately 350 potential “bonus gate” jurors because he suspected jury tampering. Corbett apparently feared he wouldn’t get elected if his image as crime fighter were besmirched by acquittals. Fair-minded people in both parties condemned Corbett’s crime busting as political persecution. Nevertheless, on November 10, 2009, Corbett the self proclaimed crime fighter, was elected governor of Pennsylvania.

On November 10, 2010, the Sandusky scandal resurfaced in State College. AG Office Bureau of Narcotics Investigation and Drug Control agent Anthony Sassano, conducting a narcotics investigation, found telephone records that revealed the Sandusky pedophile investigation that had stalled within the AG’s Office. Also in November, investigators in the AG’s office researching the 1998 and 2002 pedophile complaints recognized that the one person who had crucial information about the Sandusky pedophile investigation(s), former DA Ray Gricar, had been missing for more than five years. There was no evidence of a serious investigation into Gricar’s disappearance or of an extensive effort to find him. Likewise, there was also no record of an investigation at State College by the Attorney General’s office. Although Penn State graduate assistant Mike McQueary reported seeing Sandusky sodomizing a child in March 2002, McQueary was never questioned by University police or any other investigators, state or local, until he testified to a PA Grand Jury in December 2010.

In November 2011, thirteen years after Sandusky’s sexual contact with a child was first reported and the complaint was reported to DA Gricar, Jerry Sandusky was charged with pedophile crimes. The failure of Attorneys Generals and others within the criminal justice system to indict Charles Koons in Hershey and Jerry Sandusky in State College resulted in unfathomable harm to Commonwealth children.

According to 
http://deadspin.com/5859802 Tom Corbett is connected financially to the Second Mile charity. Second Mile Board members contributed over $200,000 to Corbett’s gubernatorial campaign in 2009-10. Past and present board members of Sandusky’s charity and their businesses or families are reported to have given $641,481 to Corbett’s various campaigns. In 2010 Corbett approved a $3million state grant for Second Mile to build an expansive new facility. The construction contract for this project was awarded in an obvious conflict of interest to Robert Poole, Second Mile’s long time board chairman and Corbett campaign contributor. This seems to be one more reason Corbett delayed his investigation of Sandusky in 2009 and 2010. With his campaign for governor drawing near, Corbett apparently wanted to avoid damaging a major source of University income, the nationally ranked Penn State football program, and to avoid creating major problems for campaign donors associated with the Second Mile charity. For the record, the grant was put on hold after word of Sandusky’s behavior became more widely known.

William Ryan served as acting PA Attorney General from January 18, 2011 until May 23, 2011. Ryan was passed over for AG and is said to have told his staff “he would make no major changes or decisions until the permanent AG was sworn in.” However, as a politically free AG, he assigned additional state police and AG agents to the Sandusky case. Ryan’s responsible behavior may have prevented Corbett from nominating him for the AG’s position.

Linda Kelly was nominated by Corbett and confirmed by the PA Senate to become PA AG on May 23, 2011. She will complete Governor Corbett’s unfinished term as AG. Wikipedia says that Kelly promised she would not run for AG in 2012. We already know that LeRoy Zimmerman’s son-in-law, David Freed, is the Republican party’s nominee for AG.

Because of Kelly’s ongoing investigation into alleged wrong doing by the Hershey Trust board, Freed’s election would create a major conflict of interest. Freed’s father in law and former AG, LeRoy Zimmerman, chaired the Trust Board from 2006 to 2011. Because Zimmerman played a significant role in Trust Board transactions, he should be held accountable for his part in alleged Trust irregularities, especially the purchase of the Wren Dale Golf Club. Freed claimed “this (conflict of interest) is a manageable problem.” If there are issues pending from AG Kelly’s investigation involving the conduct of his father-in-law, Zimmerman, he would recuse himself and hand the case over to a special prosecutor. 

Freed’s idea of using a special prosecutor sounded appropriate although Pennsylvania law might not permit it. A relevant article in the York Daily Record published on7/22/08 described a time when the Democrats thought it necessary for Republican AG Corbett to appoint a special prosecutor to avoid a conflict of interest, but were told it wasn‘t lawful to do so. At that time Democratic AG candidate, John Morganelli, urged AG Tom Corbett to appoint a special prosecutor in a case accusing House Democrats of campaigning with public resources. Corbett’s spokesman, Kevin Harley said, “State law does not allow it (appointment of a special prosecutor), and it’s obvious John Morganelli doesn’t understand the law.” Apparently David Freed doesn’t think the special prosecutor law cited by Harley applies to Republicans. Nevertheless, David Freed as AG is not likely to do a credible job investigating his father-in-law’s failures as AG or as a member of the various Hershey Boards.

Freed apparently thinks he is a shoo in to become PA’s next elected AG because he is the son-in-law of LeRoy Zimmerman and he can count on support from all Zimmerman’s political cronies, especially those who have already made patronage and financial deals with his father-in-law. Republicans have held the AG office since 1981 and that isn’t likely to change. Anonymous sources believe former Democratic Governor Ed Rendell will grease the skids within his party so Freed gets elected and Zimmerman will help Rendell get appointed to the cash cow Hershey Boards. If this happens, there will be bipartisan access to the $8 billion Hershey Trust. Bipartisan access will make it even less likely that those with legal standing will investigate the Hershey Trust irregularities or the behavior of Zimmerman and Corbett while they served as Attorneys General.

SUMMARY

Sadly, these Pennsylvania Attorneys General have a shameful record of protecting the beneficiaries of the Hersheys’ $8 billion legacy, the at risk children who can be characterized as the lambs. Certainly, the at risk children of the Second Mile charity can also be considered lambs. Koons and Sandusky fall into the obvious wolf category, but what about the guardians who look the other way when the lambs are attacked? Not exactly the good shepherds.

LeRoy Zimmerman, whose character is called into question in The Sins of Our Fathers, should have never been head of the Hersheys’ Trust. Zimmerman, Fisher and Corbett, in their roles as PA Attorneys General, failed to file charges in a timely way against pedophiles Charles Koons and Jerry Sandusky. The connections between Koons, Sandusky and the PA AG’s office are easily made by anyone willing to read the available documentation. The failure of AGs to take appropriate action against Koons and Sandusky resulted in harm to innumerable children in Hershey and State College, Pennsylvania.

There is significant evidence indicating that former AG Zimmerman has benefited directly from money meant for at risk children in Hershey. Zimmerman’s money from the Hersheys’ legacy has been in the form of astronomical compensation for minimal service on the various Hershey boards and free use of Trust venues and amenities. The AG regulated Hershey boards and apparently the Second Mile Charity’s Board have been cash cows for unscrupulous politicians and their cronies.

Overwhelming documentation supports the contention that Pennsylvania officials have abetted crony misconduct for years resulting in harm to at risk children. Childcare advocates have sought remedies in the courts and elsewhere for years -- all to no avail. The investigations sought by childcare advocates into the dysfunction and asset misuse in Hershey have gone nowhere. MHS Alumni sponsored reform gains, won in the Pennsylvania Appellate Court, were reversed by the politically connected and patronage-motivated Pennsylvania Supreme Court. At risk children in Hershey, State College and other communities in Pennsylvania continue to be harmed because of the willful neglect of those charged with their care. Their advocates’ pleas for help continue to fall on the deaf ears of State officials who have abdicated their legal authority and obligation to remedy this harm to children. Childcare advocates have no one in a position of authority to appeal to for help in Pennsylvania.

CONCLUSIONS

1. Political corruption in Pennsylvania has continually trumped all efforts by childcare 
advocates to remedy the ongoing harm to the Commonwealth’s at risk children.

2. Attorneys General in PA have not done proper investigations of the Hershey Trust 
abuses for these reasons:

To paraphrase an old saying, corrupt politicians won’t soil the place where they eat.

Hershey is a Republican stronghold and the Milton Hershey Trust, worth an estimated $8 billion, has provided vast financial opportunities for unscrupulous politicians and their shills. Politicians have viewed service on the various Hershey Boards as a source of fast and easy cash, so appointments to these boards are highly sought after patronage positions. 

Hershey has long been a playground for rich, self aggrandizing Republicans. Several governors, including Tom Ridge, have held their inaugural balls in Founders’ Hall on the campus of the Milton Hershey School.

Republicans have filled most Hershey board positions and all have received obscene amounts of compensation for their questionable service.

3. The problems in Hershey are much more profound than that of individual corruption. 
Hershey Boards lack transparency and proper state enforced accountability. Some 
Board members are former state officials who dole out largesse to garner support and 
consolidate their power. A mixture of repression of the truth, patronage, and illicit 
financial rewards have kept this group in power for decades.

4. The only way to solve the corruption and mismanagement problems in Hershey and 
State College is through the enforcement of real rule of law which has been abdicated 
by Pennsylvania officials. A dramatic shift in the structure of state power and its 
control of charities must take place if further harm to needy children is to be prevented. 
Individual lawsuits and Federal investigations resulting in indictments are needed to 
change the corrupt political paradigm in Pennsylvania.