Eckel's Protest Backfires: Reveals He May Be Compromised

Trustee Keith Eckel's protest about "being compromised" caused a second look at his background -- and the results were very unsettling.

By
Ray Blehar


It came as no surprise that Trustee Keith Eckel, who publicizes himself to the proprietor of a farm, but made a fortune in the natural gas (fracking) industry, would use dishonest arguments in an attempt to give the Board of Trustees credit for the "recovery" of Penn State.  

While I intend to eventually debunk those arguments, the one thing that really struck me as odd was Eckel's protest to Al Lord's challenge to the trustees to remove resign if the feel compromised in any way.

Here is the statement from Lord:

"My own view, if you feel compromised, if you feel at all compromised, by the various things going on in the legal world and you're on this board and concerned that you can't do the right thing, or that your decisions are effected by that and I'm not suggesting necessarily that they are, but it is certainly an element, I would suggest to you that you resign. 

Eckel's statement follows:

"Mr. Chairman, first of all, let me indicate to Trustee Lord that I'm not compromised in any way, that I stand behind of and am proud of each decision I have made on this board. I hope that you examine your position as you have urged everybody other trustee to make certain that your views do not compromise your fiduciary responsibilities to the board. 

This caused me to take a second look at Eckel's background -- and the findings revealed his association with an individual with possible ties to organized crime.

As I wrote in this op-ed, Keith Eckel is not just "some simple farmer."  When Keith last ran for the Board of Trustees in 2013, he offered this biography, noting his experience on the Board of Nationwide Insurance, for his agricultural constituents' consumption.  Apparently, he wanted his agricultural friends to understand he wasn't just a "simple farmer."

Eckel:  Dishonest about his
background and being
compromised?

However, after being elected, his official Board of Trustees biography did not mention his experience at Nationwide nor his directorships its subsidiaries, Allied Group and the Gartmore Global Asset Management Trust.  Apparently, he didn't want the PSU constituency to be aware of his corporate background - let alone his vested interest in natural gas.  

However, just this past October, Eckel was also named to the Board of First National  Community Bancorp,  whose Chairman is Dominick DeNaples.  

DeNaples is the brother of former Mt. Airy casino owner Louis DeNaples, who also serves as a director and sits on the loan committee with Eckel.  

Louis DeNaples was forced to give up his casino to avoid perjury charges in 2009.  DeNaples, who also owns the Keystone Landfill, was charged with perjury for denying any connection to former Northeast PA crime boss, Russell Bufalino.   

It is highly unlikely that Eckel was unaware of the background of Louis DeNaples, as his alleged connections to organized crime have been well publicized over the last five to ten years.  

Why would Eckel associate with DeNaples?  

The Assistant U.S. Attorney for the Middle District may have the answer.

Sex Trafficking

Typically, organized crime is involved loan sharking, racketeering, gambling, construction, garbage hauling/waste management, drugs, prostitution, and human (sex) trafficking.  The latter is particularly troubling given the many unanswered questions in the Sandusky scandal.

Prosecutor Joseph McGettigan referred to The Second Mile (TSM) as a "victim factory."  Are we to believe Sandusky was the only child molester who abused the TSM participants or were there others?  Were some of the others rich TSM donors who also happened to be PSU alumni?  If the latter is true, and the board knew about it or were actually involved in some way, it would provide a not so far-fetched explanation why Eckel and his cohorts voted against completing the Freeh investigation -- and why they hired Freeh in the first place.  

As the evidence shows, Freeh was hired to provide the appearance of a thorough investigation.  As Frazier and Corbett touted the 267-page report, it was strictly a matter of quantity over quality.  Freeh's investigation omitted key evidence and steered clear of taking a hard look at TSM.  

As I pointed out in this blogpost, several members of the TSM Board were distinguished alumni and big fundraisers for Penn State -- a fact not in the Freeh Report's chapter on TSM.   If it was found that TSM was a front for a child prostitution ring, the embarrassment to Penn State would have been far worse than the negative publicity generated by the Sandusky scandal.    

The child prostitution/sex abuse angle also might explain why the former PA Office of Attorney General had "inexcusable delays" investigating Sandusky (and The Second Mile).  It appears the hesitancy on pursuing the Sandusky's case wasn't unprecedented. Then AG Corbett also refused to investigate 2005 allegations of a pedophile sex ring in York County.

Note that this is just one scenario, among many, that has yet to be ruled out in terms of explaining the actions of the Board. 

Untouchables?

According to Assistant U.S. Attorney for the Middle District, Gordon Zubrod, "the connection between organized crime and public corruption...is very real in this district" and that there are pockets of "people who think they can't be touched."

Are Keith Eckel, select members of the BOT, Tom Corbett, Ron Tomalis, and others part of this group who thinks they can't be touched?

According to a source close the the PA Department of Agriculture, Eckel nominated the top four picks for the Secretary of Agriculture to Governor Corbett.  Eckel also kicked off Corbett's 2014 gubernatorial campaign in Wilkes-Barre.  

Relationships between the PSU trustees and government officials can be quite useful.  At the same time, they can also be quite damaging when loyalties are not prioritized.  

Clearly, the BOT followed Tom Corbett's lead in the firing of Paterno and Spanier -- and just look at the reputation and financial damage that has caused PSU.

Misplaced Loyalty and Fiduciary Responsibility
At the October 28th meeting, Trustee Anthony Lubrano fired this "warning shot" across the bow of the 17 trustees who would eventually vote against Lord's resolution:

Mr. Chair, I would like to submit for the record this handbook for charitable non-profit organizations, Tom, I'll get you an electronic copy of it. There are several points in that handbook that are very relevant. As a board member we have a duty of loyalty. As board member we have a responsibility to verify the veracity of information provided to us. As a board member we have the right to receive all information that's necessary and relevant to assist us in performing our duties. 

By and large, Mr. Chair, because I believe that there's no more damning document than the Freeh Report with respect to the institution that I have a duty of loyalty and for who's resources I have the responsibility to steward l chair, we have yet as board to actually evaluate the Freeh Report ever, from my very first meeting July 12th we were quick to accept recommendations but we really had no interest in exploring the basis for those conclusions. I have an obligation I believe, Mr. Chair, to verify the veracity of the information that was reached to -- made to reach those conclusions. 

Mr. Chair, as pointed out by several of my colleagues already, Judge Pellegrini, the judge wrote the dissenting opinion in the case, he wrote something in his opinion that should make us all pause. 

He wrote the majority appears to arrive at this outcome, referring to the six colleagues, because it is bewildered, as am I, by how the board of trustees of PSU could approve or allow to be executed a "consent decree" involving the expenditure of 60 million of PSU funds when the consent decree states that the matter "ordinarily would not be actionable by the NCAA." If as the majority suggests the NCAA did not have jurisdiction over conduct because it did not involve the regulation of athletics, then the expenditure of the funds is problematic given that PSU is a non-profit corporation and being tax exempt as a charitable organization and the boards of directors of non-profit charitable corporations has a -- that's important -- a fiduciary duty to ensure that funds are only used for matters related to the charitable purpose, in this case, the students of PSU. 

Mr. Chair, if ever there was a time for us to undertake this it would be now.
Going back to Eckel's October 28th statement, he had a very different view on his decisions that were in stark contrast to Judge Pelligrini's and Lubrano's:

At the end of the day my responsibility, my fiduciary responsibility is to our students and our constituents. My votes have been since that fateful day in November, they'll continue to be to this day, I urge the defeat of this resolution and the moving forward with this University. 

Who is right?

As is the case with all the outstanding questions in the scandal, current and future court cases, and pending investigations will decide a number of outcomes -- possibly including a case about fiduciary responsibility at Penn State. 

Yesterday's revelations on the NCAA emails caught the PSU administration flat-footed, judging by their official response.

Part of the truth was revealed and things are moving in the right direction.

Eckel and his cohorts days are numbered, though I believe they will continue to believe they are untouchable -- up until the day they are forced out.