Wednesday, November 20

Freeh's Fake Investigation Covered Up the Ties Between The PSU BOT and The Second Mile

Freeh covered-up the financial relationships between The Second Mile and PSU and focused his reporting to railroad Paterno and the three administrators, while protecting his client, the BOT 

Ray Blehar

The Engagement Letter between Freeh, Sporkin, and Sullivan (FSS) and its client, the PSU Board of Trustees Special Investigations Task Force, required FSS to "perform and independent, full and complete investigation" of the Sandusky scandal.   Additionally, FSS was provided guidance to complete the investigation in parallel to, but independent of other ongoing investigations within or outside PSU (e.g. The Second Mile).

On the latter point, FSS's fake investigation clearly satisfied its client, as it covered-up  the financial relationships between key members of The Second Mile Board of Directors and Penn State.  This was very similar in approach to the omissions FSS made about the failures of DPW in the 1998 case, which I exposed in Report 1.

Not only did it omit the financial dealings of the TSM Board Members, but it also failed to identify PSU Board of Trustees and/or their companies who donated to the charity.  This information was readily available for the years 2005 through 2010 on the publicly available Annual Reports of the charity.  Moreover, the IRS 990 forms for the charity were also available for review by FSS, yet none of these documents are referenced anywhere in Chapter 7 (titled "Sandusky's Post-Retirement Interactions With the University").

Instead, FSS relied on a few newspaper articles and some alleged interviews with a program director and a counselor of TSM for the information.  I suspect the interviews are "alleged" because it appears that the  information on page 109 regarding the Friend Program may have come from a passage in the 1998 police report.

 FSS used a similar tactic when it regurgitated the grand jury report of the janitor  (see page 73 of linked report), called it his trial testimony, then said it was obtained through an interview of the janitor immediately after the trial.   And there are other examples of this in Chapter 7, where Freeh references an interview but the information appears to be taken from (erroneous) press reports.

Chapter 7 provides ample evidence that FSS conducted a fake investigation that resulted in a pre-determined outcome (blaming Paterno and the administrators for Sandusky's crimes) and attempted to spare its client (the PSU BOT) from being exposed as having financial incentives to cover-up for TSM.

The Nonsensical "Facilities As An Enabler" Ruse 

Part II of Chapter 7, Sandusky's Post-Retirement Involvement in Second Mile Activities provided a high level summary of PSU's support of Sandusky's activities with the charity that was mostly lies and  innuendo about the use of facilities enabling Sandusky's crimes.   The chapter leads off with the a few paragraphs about how Sandusky's access - and therefore people who approved his retirement package, sans Erickson -  put children in danger.

As I pointed out in this blogpost, there was not a single sign  ("red flag")  or complaint of child sexual abuse at Sandusky's privately held camps or at the camps on PSU's campus after his retirement from PSU.

Let that sink in for a moment.  There was not a single complaint emanating from any of the camps run by Sandusky from 2001 forward, yet PSU was castigated by Freeh for allowing Sandusky to use PSU facilities.  In fact, there is no evidence that Sandusky ever met a child during these camps that he groomed or attempted to groom for child abuse.

That is an amazing fact to consider.  Apparently, the environment and surroundings at the sports camps held on PSU property were not as conducive to Sandusky's abusive behavior as his "hunting ground" at TSM, yet TSM has escaped this scandal without being criminally charged.

However, there is another side to the facilities coin in this mess, and it appears that Freeh's whitewashing of the BOT's relationships with TSM and Sandusky is revealed in this passage if you know the background information on TSM:

The other non-University location was the Greenhills facility outside Reading, Pennsylvania.  It was owned by PSU BOT member Ira Lubert, who was also on the Board of the SouthEast Region of TSM for a period of years in the mid-2000s.   Therefore, if this was a "fair" investigation, the report should have made mention that Lubert also was putting children in danger by letting Sandusky use his facilities.

Those facts make all of Freeh's "reasonable conclusions" about the use of facilities granted through Sandusky's emeritus status quite meaningless and exposes the bias in his reporting.

Let's face it, if the key enabler for child sexual abuse was access to facilities, wouldn't the prime suspects in those types of crimes always be....janitors?

Freeh Report Hides Financial Connections Between PSU and TSM

While FSS was railroading Paterno, Spanier, Curley, and Schultz as the enablers of Sandusky's abuse, it did an even better job in ensuring that nothing would raise the public's suspicions regarding the PSU BOT's relationships with TSM's board members.

As noted earlier, there was ample information on the public record that any legitimate investigator would have utilized in conducting this part of the investigation.  But as we have learned, Louis Freeh is not a legitimate investigator -- he is a "hack" who runs a phony investigation racket.

The 2005 to 2010 Annual Reports of TSM revealed that many of the leaders of the 2011 PSU BOT and/or their companies were donors to the charity (see list below).

As you can see, US Steel, the company of the "hatchet man" (Surma) who fired Paterno, donated to the charity every year, but dropped its donations and the Sandusky investigation got underway in 2009.  Similarly, Merck, the company of the co-chair (Frazier) of the group that hired FSS, also was a donor up through 2009, but mysteriously stopped in 2010.   Coincidences?  Doubtful.

Linda Strumpf, who is on PSU's investment council may have believed TSM was a great "investment" in 2010 and chipped in between $5,000 and $9,999.  Strumpf is the retired chief investment officer of the Helmsley Charitable Trust -- yes, Leona Helmsley's charity.

Lloyd Huck, an emeritus trustee in 2011, and his wife Dottie, donated over $40 million dollars to PSU and was also a contributor to the charity.

However, where things get really interesting is when you examine the business relationships of Board of Directors of TSM and some of the prominent roles they play at Penn State.

First, the Chairman of the Board of TSM, Robert E. Poole, is a distinguished alumni of Penn State and sits on the Executive Committee of  Penn State's Campaign for the Future, along side PSU BOT members John Surma, James Broadhurst, Ed Hintz, and Karen Peetz (plus emeritus trustee Ted Junker).  Not so ironically, these PSU trustees on the Executive Committee for the Campaign for the Future were also on the 11-9-11 PSU BOT Executive Committee.

Poole is the major gifts chairman for the Campaign, which is expected to raise $2 billion for PSU by 2014.

However, Poole's relationship with PSU is not just as a fundraiser.  A visit to the website of his company, Poole Anderson construction, reveals that he has done a lot of big jobs (a spreadsheet has been reproduced below) for PSU over the last decade.  Isn't it amazing that the former-FBI Director and alleged top notch investigator, Louis Freeh, didn't report these facts after his fake investigation?  Note: This information was reported by in November of 2011, yet the Freeh group didn't report it.

Another important TSM Board Member is Richard (Ric) K. Struthers, who is also a distinguished alumni and also is an at-large member of the Campaign for the Future.  As reported by blogger Marc Rubin shortly after the Sandusky scandal broke, Struthers was also on the MBNA team at the same time Louis Freeh was its General Counsel.

Struthers' MBNA/Bank of America credit card deal with PSU involved paying $30 million dollars to the University for exclusive use of its alumni lists for sales and marketing from 1994 to 2010.

Struthers donated at least $50,000 per year to TSM in 2005, 2006, and 2007.   He donated at lower levels in 2008 through 2010.  His family foundation donated $250,000 to the Building Fund for the PSU Smeal College of Business in 2010.

Finally, Linda Gall was also a member of the Board of Directors for The Second Mile, who also sits on the Executive Committee for the Campaign for the Future.  She is the chair of the Stewardship Committee for the campaign. Linda's husband, Blake, is the Founder and President of Micro Plus Plus Investments and is a member of Penn State's Investment Council.

Are we to believe that the former FBI-director and his team were not able to find this information that was not only on the public record, but in some cases already reported in the press?

At the July 12, 2012 press conference, where Freeh was asked about his investigation of the Second Mile by PSU alumnae Wendy Silverwood, he responded:

"Well, I think you need to direct your question there.  We did as much as we could in that regard, relevant to our mandate.  Many of the people there would not speak to us. We didn't have access to their records.  We didn't have subpoena power as you know. But you raise a good question."

Doing the Math for Good Governance

As alumni voice concerns as Penn State's bill for the Sandusky scandal will easily clear $100 million, one can easily see that $100 million is chump change compared to the $2 billion the University plans to raise through its Campaign for the Future.   As a result, the PSU BOT members (Hintz, Peetz, Surma, Broadhurst, etc) may have had an incentive to ensure Freeh's fake investigation kept the stink of the Sandusky Scandal off of their cohorts on the fund raising campaign.  Note:  Corbett's investigation appeared to keep the stink off of TSM for financial reasons as well.

Today the legislature will propose structural changes to the PSU BOT, but subtracting a member here and there and reducing the size of the Board will not get to the root of the problems in governing PSU and serve the University's best interest.

As we have known since the release of the Freeh Report, the Boards foot-dragging on the implementation of recommendation 3.2.2 - full and public disclosure of the Board's financial relationships - is key to fixing the governance problems at PSU.


  1. This is excellent! I think what we're seeing here is, there really just can't be "financial relationships" allowed for a BOT that is truly impartial and actually has the university's best interest at heart. Otherwise as you have shown, the BOT just becomes a self-serving and self-protecting entity. It can and will intentionally turn on the very thing it has been put in place to protect.
    I truly hope these BOT members, Corbett included, are brought to justice for the kind of dishonesty, greed, and appalling damage they have done to the university.

  2. Excellent work Ray!!! I knew something smelled rotten and this looks like it. Keep up the good fight!

    I know your work gets criticized by others for blaming/criticizing victims and shilling for JoePa, but this article gets to the heart of the matter. Powerful and corrupt men are covering up their financial ties which enabled a pedophile to roam free longer than he should. They framed innocent men to take the fall, so they continued to line their pockets.

    All of the naysayers said this was an unsupported conspiracy theory. I'd say this adds some meat to the theory and offers a compelling counter-narrative to the original railroaded story. There may even be enough here for the media to pickup a new narrative. However, that would require them to admit they were wrong.

  3. Incredible, I have always thought that there was more to this than was told in the beginning. How everything was done so quickly always promotes questions as to why. You have done an excellent job putting the blame wre it belongs.

    1. Bob,
      Thanks, but this is just one (or two) possible reasons why the BOT (and Corbett) did what they did. Freeh ran a phony investigation because that's what he does for a living -- nothing special about the screw job he did at PSU. BP, Wynn, and FIFA all got shafted too.

  4. I also find it hard to believe that Frazier did not know that Pepper Hamilton was about to acquire FSS and name Freeh head of its excom. And lots of $$$ subcontracted to Pepper Hamilton for the fraudulent report. What was Pepper Hamilton's output?

    Frazier needs to be pounded harder.....relentlessly. Anyone who reads the Wikipedia article on the Vioxx Fraud, Frazier and Pepper Hamilton's strong-arm tactics to cover the fraudulent FDA Data Package, and the final discovery of the depth of the fraud in 2009, will scratch their heads as to why Frazier was not prosecuted for negligent homicide. There is certainly enough evidence to support that, and 98,000 dead Americans.

    His scripting of the well rehearsed 2012 Press Conference and the heavy handed tactics he is using on the BOT fit his MO perfectly.

    1. Gregory,
      So many people to pound -- so little time. I'm going to beat up Freeh a little while longer and will probably pound Frazier and Tomalis for being enablers.

      I do have a little something special planned for Frazier because of his sanctimonious comments on people's obligations to protect children. Maybe we'll have Linda Berkland put a nice video together on that too.

    2. Freeh is a pathetic human being, but the strategic targets should be Corbett, Frazier, and Frank Fina.

      Maybe John Zigler can take a break from getting into pissing battles with skunks, and go after Fina to make himself useful.

      Frank Fina: Crooked Cop, fabricator of the janitor Hoax, subordinator of perjury, witness tamperer, leaker of GJ testimony. Not so smart in changing dates, though. August 2001 in the Lasch Building? Anyone who knows how JP conducted preseason practice would know that the CIA would have trouble getting within 200 yards of the Lasch Building, let alone Sandusky and a kid.

      I can just imagine Fina talking to McQuerry: " Listen kid, we know about your sexting and gambling debts. We know you go places where they have slap happy sex. Maybe you are into a little S&M. We know that we can revoke the medical practitioner certificates from your dad and that Dranov guy for not reporting whatever it was you told them. If you're a smart kid, you don't want that to happen, and you don't want us breathing down your back for the other stuff. Now this is what you are going to do for us..."

      From my point of view, what happens to Frank Fina will be the METRIC of Kathleen Kane's investigation.

    3. I agree with you about the "strategic targets" for Kane's investigation should be Corbett, Frazier and Fina. But Freeh is the bigger cancer here that needs to be removed. His illegal racketeering business is what gives these corrupt corporate and political thugs the courage to brazenly break the law with their stealing, lying, and slandering of innocent people. They know that there is a former director of the FBI that will "get them out of" their crimes for the right price. Freeh's very existence gives impetus to these corporate and governmental attacks on innocent people.
      To me, it is almost surreal that someone like Freeh is running around freely (no pun intended), to blatantly, and illegally offer services of professional slander and false reports. It's nothing short of obstruction of justice and racketeering. And for some unknown reason, our federal government is allowing it. If this truly is America, as we think we know it, then Louis Freeh should not even exist as he does, a criminal operating out in the open with impunity.
      Does anyone have any ideas as to why Louis Freeh seems to be untouchable? Does he hold dirty secrets against our government that he has acquired while director of the FBI? And in essence, he is engaging in a sort of silent blackmail to run his criminal business? This is "1984" George Orwell kind of stuff that gives unimpeded power to any corrupt element of government to turn on any citizen whenever a scapegoat is needed. I believe the citizens of this country should insist that Louis Freeh be taken off the streets. Because any one of us is a potential target. Who would have thought that someone like Paterno, and even Spanier, devoting their lives to good and the university, could be so easily destroyed by falsehoods presented as truth by a corrupt state government?
      Kane, you've got some work to do. Let's hope you do the right thing to prove that you want to right these wrongs committed against the Pennsylvania people.

    4. Well said, Truthseeker. You have my word that I will do everything I can possibly to do take Louis Freeh off the streets.

    5. We need an Edward Snowden of the 1990s, someone who worked for the FBI as a contractor, employee, source.

      Ray, can you or your network find such a person who perhaps worked on the Atlanta Olympics, Ruby Ridge, or other fed fiascos back in Freeh's days?

  5. Ray... not clear on why you would apply the 'facility enabler' charge to Lubert for Greenhills events. Not being snarky, but hasn't the stand of the BOT been that they didn't know anything about the '98 event or the 2001 incident? So how would Lubert be putting the kids in danger in the same way Freeh alleges Paterno, et al did?

    And since they didn't know Sandusky was a pervert while they were donating to and supporting TSM... how does all of this financial linking matter? Unless someone can show that the BOT members knew about Jerry's activities, how does all of this info amount to a Freeh-BOT coverup?

    I mean, I can see how they would want to avoid closer scrutiny of their connections to TSM if some people at TSM were aiding Jerry's activities or looking the other way... but those people would also say they just didn't know Jerry was a monster.

    So to say that many PSU BOT-ers and Campaign for the Future folks were involved with TSM only means that they put their bucks into an organization that was also hoodwinked by Jerry... not that they could be hurt by their TSM activity.
    Don't get me wrong, I'm all in for exposing the Freeh report, mandating a better-constructed BOT, and getting due process for Joe and Co., I just don't see where creating this vast conspiracy theory involving the power plays within the BOT, other cash-creation entities at PSU and TSM gets us anywhere.

    1. I've always thought that the Second Mile was a victim in this fiasco. Lots of good people helping kids. Raykovitz and his wife were feathering their nest with their outrageous salaries, so I really didn't see any culpability beyond them. Whether their behavior was criminal is problematic. They, like everyone else knew that Jerry was rigorously vetted for adopting children and receiving foster children. That seemed to function like a force field when inappropriate behavior occurred.

    2. Steve Girard,
      First, the intent of this blogpost was to point out that the Freeh Report and investigation was faked and biased. In Chapter 7, Freeh makes points about financial ties only to the extent that "students solicited donations" for golf tournaments and TSM events and that Schultz went to bat for TSM for a loan. Thus, he mentions a couple piddly things while overlooking ALL of the donations to TSM by Board members go unreported. Then there are the business and PERSONAL relationships between the TSM Board and PSU.

      But Freeh doesn't report those and makes the ridiculous claim that Spanier, who himself was abused as a child and was often criticized in the press, didn't report child abuse to avoid bad publicity? Talk about a "conspiracy theory."

      As for Lubert, I am simply pointing out he deserves the same level of blame from Freeh as the other guys if Freeh believes providing facilities is an enabler of child abuse.

      Read Report 1. Freeh clearly omitted the evidence that proved the state screwed up the 1998 investigation. Freeh was recommended by Corbett for the job. Frazier and Tomalis guided his investigation so that it put all the focus on PSU athletics. There is also ample evidence that Corbett steered the investigation away from TSM -- as did PSU.

      For example, why did it take the police 25 months to get a subpoena for the participant records of TSM? The police knew Fisher met Sandusky through TSM. They knew that Sandusky volunteered at CMHS because he had some TSM kids on the team there. Any real police investigation would have made TSM its first stop and Sandusky's house its second stop. The search warrant for Sandusky's house was obtained 31 months into the investigation. Those actions were pro-forma. No information from either place was used to find a victim. As you know, the Kane investigation is looking into this footdragging -- and some suspect it was done because many people at TSM were donors to the Corbett campaign.

      All I can say is you're very naive if you think money isn't involved in this scandal and that there was not a concerted effort by both Corbett and the BOT to protect TSM.

    3. Gregory,
      I agree that a lot of good people (like Blake & Linda Gall and Lloyd & Dottie Huck) believed in TSM's mission. And TSM did help a lot of kids, but there were people in the know about Jerry at TSM and they covered it up.

  6. Any basic consideration of conflicts of interest would have certainly included Robert Poole. TSM Board Chair, recipient of MAJOR PSU building contracts since 1998, and on Exec Committee that pledges to raise $2 billion for PSU. How could Poole not have been investigated????

    1. This is a great question rdk! I also believe Poole's brother, Thomas Poole, is PSU's VP Administration serving the Board and president's office... things that make you go hmmmmmmmmmm.

    2. I don't think that Tom Poole is related to Bob Poole.

  7. Holy Crapola! WOW Ray great job! I had to read this a few times to understand all the questionable relationships and events here. Amazing facts. It's quite clear that children have never been top of mind for any of the BOT and TSM power players - but this makes it substantially clear what was at the center of it ($$) and why they were so willing to control and blow the PSU smoke screen!