June 4, 2006
Scouting Group Inflated Roster, Inquiry Shows
By THE ASSOCIATED PRESS

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BIRMINGHAM, Ala., June 3 (AP)  An internal audit revealed on Friday that the rolls of an Alabama Boy Scout group under F.B.I. review were inflated by more than 13,000 memberships over three years.

The group, the Greater Alabama Council, which serves much of central and northern Alabama, said nearly all of the questionable memberships were linked to a program that was supposed to serve disadvantaged city children.

The council issued a statement announcing "corrective actions," including the retirement of its chief, Ronnie Holmes, and periodic audits by someone outside its staff.

The Federal Bureau of Investigation began reviewing the council's records in late 2004 after questions were raised about its rolls and "ghost" youths created to increase the size of the organization. The council also began an investigation.

Critics have said that larger membership rosters might lead to additional financing from donors and to greater career opportunities for scouting officials. The United Way gave the council almost $1 million in 2005.

No charges have been filed.

John Hayden, the chairman of the council's board, said auditors did not determine whether the problems were accidental or deliberate.

Any problems are unacceptable, Mr. Hayden said, adding: "We're the Boy Scouts of America. "We've got to do everything right."

The audit found several thousand questionable registrations each year from 2002 through 2004, according to a statement from the Scouts. Most of those involved a program that waives a $10 fee to help youths from low-income homes.

The worst year was 2002, when 5,619 applications were found lacking basic information, representing 13 percent of the membership in the council's traditional scouting programs that year.

Tom Willis, a dentist and scouting volunteer who went public with claims of inflated membership, has said that Boy Scout employees would often add fictitious children to rosters under pressure from headquarters of the council, which oversees programs in 22 counties.

In one case, Mr. Willis said, he found about 20 children in a school-based group who had the last name Doe.

Birmingham News
Couple's names put on phantom Scouting rolls
Tuesday, January 18, 2005
KELLI HEWETT TAYLOR and JEFF HANSEN
News staff writers

A former Jefferson County Boy Scout leader says his and his wife's names have shown up in two nonexistent Boy Scout groups in the last five years.

Longtime Scout volunteer Wayne Lee, now of Jasper, said he and his wife, Sandra, have each been mailed copies of "charters," which are official letters establishing new Scout groups. The letters named the
Lees as the leaders of the groups. The Lees were not.

Each letter they received was for a coed Scouting group called a Venturing Crew, for 14- to 21-year-olds. The Lees have worked only with Cub Scouts and Boy Scouts.

"There needs to be accountability; the problem lies when you start lying," said Wayne Lee, a white-collar crime detective for the Birmingham Police Department.

In Birmingham, the FBI is investigating allegations that the Greater Alabama Council of the Boy Scouts of America, which includes Jefferson County, has padded membership rolls to boost grants and other
financial contributions. United Way of Central Alabama has allocated about $950,000 to the council for 2005.

About five years ago, Sandra Lee received a copy of her charter in the mail, confirming the establishment of a crew with her as a leader. She was named with a group at Tarrant High School - a place she has never
visited, with children she had never heard of.

She did not pursue answers to her charter letter.

Then, about two years ago, Wayne Lee said he received a charter confirmation letter for a Venturing Crew at First Presbyterian Church in Birmingham, where his Boy Scout Troop 57 was based. The nonexistent
Venturing crew included names of boys in his Scout troop and some of the adult volunteers of his Scout troop.

"We knew it was bogus the moment we saw it," Lee said of his crew charter letter.

Lee said he also received a confirmation letter of supposed financial support to Lee's Boy Scout Troop 57. Lee said he had received no such troop financial support, nor did his boys need it. Most were from more
affluent families.

Lee wondered if a support check might have been written to his troop, or cashed by someone else.

"I went to see Ronnie Holmes," the Scout executive for the Greater Alabama Council, Lee said. "He said those (financial support) letters got sent out to all the units and it wasn't supposed to be."

Attempts by The Birmingham News to reach Holmes have been unsuccessful.

Wayne Lee said a few days after he talked to Holmes, an assistant called on behalf of Holmes.

"He said there had been some supervisor or executive who had given them some bad advice," Lee said. "He assured me nothing like that would ever happen again."

Greater Alabama Council officials declined to comment for this story.

The FBI last week subpoenaed Boy Scout records from the United Way of Central Alabama. FBI spokesman Jeff Fuqua said the investigation is a pending matter and the FBI will not comment on the case.

Alabama board members are conducting an internal audit, said 2005 board chairman Randy Haines, who is the Alabama commercial executive for Compass Bank. He declined to make additional comments for this report.

Mystery Scout groups have been reported for decades in similar investigations around the country in cities such as Chicago, Dallas and Atlanta.

Wayne Lee says the questions of "ghost troops" and other membership issues don't surprise him. He says for years it has been commonly known that district executives are under pressure to meet goals for
new troops and members.

He is glad there is an investigation.

"This is going to be bad for Scouting on the public front, but good for Scouting in the long run - it's got to be fixed," Lee said.

MORE DOE'S MIGHT HAVE MEANT MORE DOUGH FOR THE BOY SCOUTS: ALLEGATIONS OF INFLATING MEMBERSHIP NUMBERS

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Were from Chicago, but even we were shocked to learn that the FBI is investigating the Greater Alabama Boy Scout Council for allegedly inflating its membership rolls. The newspaper reports suggest that the motivation for the alleged overstatements was obtaining a larger amounts of United Way funding. The alleged scheme was not very sophisticated, with one volunteer reporting that one list he saw contained twenty boys with the last name of Doeapparently based on the police name for an unidentified male suspect or corpse. What is almost as amazing as the basic allegations are the reports that the alleged falsifications...

had become so prevalent that some had dubbed such falsifications "ghost units."

Jeopardizing the Core Mission. This story has already received a lot of press. We are not surprised because this is a scandal that taints the Boy Scouts core missionthese are always the most damaging scandals. It would be one thing if a bookkeeper had stolen $100,000. Certainly not a desirable event, but it would be a side issue. But here we have an organization that's core mission is teaching young people the value of honesty and good behavior. If the allegations are true, the adults who perpetrated the fraud certainly have not set a good example.

Lack of a Meaningful Response.
In a January 13, 2005 article, the Birmingham News reports

The council is not responding to questions, but it has begun an internal audit of its membership numbers. Keith Williams, the endowment and marketing director for the council, said that all questions about the council will be handled by Randy Haines, its incoming board chairman. Haines declined to answer specific questions from The Birmingham News this week.

We have not seen much in the way of formal comment from the Greater Alabama Council since that article appeared. The Greater Alabama Councils website has lots of information about upcoming eventsincluding the March 11th "Night of Honor" and a NASCAR "Days of Scouting" event. But there is nothing that specifically highlights the investigation or the allegations. If you click on a link labeled A Message From Our Incoming Chairman of the Board," you will find the following comment in a letter

As we begin our new year, we are faced with some difficult challenges. Allegations have been made that the Council has inflated its membership numbers. Federal law enforcement authorities are investigating those allegations and we are cooperating with them fully. We have also begun an internal audit of the membership numbers and the verification process we use at the time of registration and re-chartering. Let me assure you that your Executive Committee considers these allegations to be very serious and is taking necessary and appropriate action.

However, this is just part of a letter that covers other issues. If we were running the organization, we would be getting the facts out. What are the procedures for verifying membership counts? What is the organization doing to prevent this from happening again, if the allegations are true? Who was involved, if anybody? Has anyone been fired? Who is conducting the internal audit? Is the audit independent? Have any moneys been returned to United Way?

While we dont mean to suggest that people have an obligation to confess to a crime if there was a crime, the facts are the facts and those will come out eventually so why not get them out sooner so that damaging speculation is put to an end? This strikes us as particularly important here because press accounts have contained comments from several Boy Scout volunteers, as well as the United Way. In our mind, this is a case where the Boy Scout organization should be getting out front of the story.

In all fairness, we would not be surprised if the silence is due to the advice of the organization's lawyers, and we are respectful of such advice and don't mean to suggest that people should ignore it. At the same time, if there are wrongdoers, the organization needs to distance itself from them quickly.

Part of the distance process involves getting the facts out.

Why Is This a Federal Matter? We are a bit puzzled why this is a Federal matter, requiring FBI involvement. If there is an indictment, we will be interested to see what statutes were violated. We can only speculate, but the Alabama Councils 2002 990 reports $100,709 in government contributions ($6.4 million in total revenue). The form also reports camping for scouts meeting low income requirements. It is possible that there was a violation of the Federal False Claims Act if an application for for Federal funding was made, but this is just speculation. As we have already noted, many of the press accounts report that the allegedly false counts were reported to the United Way as part of funding requests. We can only speculate, but possibly in addition to United Way money, the Alabama Scouts sought comparable funding from the Combined Federal Campaign ( the equivalent of the United Way workplace campaign for Federal employees), somehow triggering Federal jurisdictionbut as already noted, this is just speculation. There is a lesson here for other non-profits if our speculation turns out to be correct. No matter how small the amounts involved, you dont want to be filing false statements in anything that ends up in the hands of the Federal government.

United Way May Need Better Controls.

As readers of this blog know, we are quite good at shifting some of the blame to the alleged victims of many wrongdoings. We are unwilling to spare the United Way from criticism. First, if head count was a basis for a funding decision, the United Way should have had a better verification process than it apparently did--once again assuming the allegations are true.

The newspaper accounts report that there have been several investigations in recent years over inflated Boy Scout membership numbers in other locales (specifically cited are investigations in Texas and Atlanta, Georgia). If the United Way was a victim in these cases, why didn't the United Way notify other United Way chapters of the practice? Hopefully more facts will come out.

Gays and Lesbians Already Having A Field Day.

Recall that the United States Supreme Court ruled in 2000 that the Boy Scouts could bar gays and lesbians from membership in the organization. A quick search of Google already shows a deep interest in this story in the gay and lesbian communities. For one article from 365Gay.com, click here. You can expect to see commentary from gay and lesbian groups.

Will Other Shoes Drop? Several stories report some overall dissatisfaction with the Alabama Council's operations. In particular, there is discussion about a transaction involving the proposed purchase of a "super" camp. In a December 30, 2004 article, the Birmingham News reports:

Willis said the FBI investigation follows a growing distrust by some volunteers of the paid leadership of the council. That distrust was magnified by the recent debate over whether to spend $5.6 million to acquire land in Blount County for a super camp to replace smaller, regional camps, he said. He said he and others felt the price had been inflated by the owners....

While looking into the camp, the council and scouting leaders discussed waning attendance at scouting camps and questions about the number of reported scouts arose among scout troop leaders. When they tried to get answers, they were denied information, he said.

It will be interesting to see whether the "ghost unit" allegations surface other issues.

THE FOREGOING IS NOT AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. IF LEGAL ADVICE IS REQUIRED, THE NON-PROFIT OR OTHER PARTY IN QUESTION SHOULD SEEK THE ADVICE OF QUALIFIED LEGAL COUNSEL.
If you liked this post, please visit http://www.charitygovernance.com for a description of our Guide/Tutorial for non-profit directors and officers entitled Avoiding Trouble While Doing Good: A Guide for the Non-Profit Director and Officer by Jack Siegel.

FBI Probes Boy Scouts Over 'Phantom' Members In Gay Ban Wake
by Doug Windsor 365Gay.com New York Bureau, January 25, 2005 9:02 pm. ET

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(New York City) The FBI is investigating the Boy Scouts of America amid allegations the organization is inflating its membership to gain funding.

Membership in the BSA has declined since a 2000 Supreme Court ruling that held that the Boys Scouts and its affiliates can prohibit gays. The high court said the constitution gave scouts the right to choose its members. The Scouts also prohibits atheists.

A number of cities banned the scouts from using public facilities, and charitable groups like some United Way chapters cut off the scouts.

But, in cities where agencies like the United Way continues to fund the BSA it is alleged that troops are being encouraged to list fake names as members to boost enrolment making the group eligible for more money.

Federal agents are probing local councils in at least three states - Alabama, Georgia, and Texas.

"The BSA national leadership continues not to follow their own oath of honesty," Scott Cozza. of Scouting For All told 365Gay.com.

"This isn't the way to deal with dwindling numbers - being inclusive is."

In Birmingham, Alabama, boy Scout volunteer Tom Willis said he knew something was wrong when he saw that 20 youngsters on the list for a scouting program all had the same last name: Doe.

"It was just so blatant, Willis told the Associated Press. "They didn't even try to make up names," said Willis, a dentist from Decatur and a former Eagle Scout who serves on the board of the Greater Alabama Boy Scout Council, which runs scouting programs in northeastern Alabama.

The FBI refused to comment on its investigation. Greg Shields, a spokesman at the Boy Scouts' national office in Irving, Texas, said the organization has numerous policies meant to ensure the accuracy of its membership rolls, and is "dedicated to the accurate reporting of membership."

The Greater Alabama Council claimed 10,000 new Scouts that year, and tax forms show it had revenue of $6.5 million, including $100,709 in government grants. In a United Way funding application, the group said it served almost 120,000 youths and adults in 2003.

"I would say the numbers are probably inflated 30 to 40 percent in our council," Willis said.

Federal prosecutors have subpoenaed the Boy Scouts' grant applications, audits and tax forms from 1999 through last year from the United Way of Central Alabama.

Nationally, the Boy Scouts claim 1.2 million adult leaders and 3.2 million youth members in six programs, including the Cub Scouts and the Boy Scouts.

Suspicions have led to investigations elsewhere. In Texas, a Scout group removed thousands of names from its membership rolls and a federal grand jury two years ago looked into the matter. No charges were filed.

In Atlanta, independent auditors are investigating claims the metropolitan area's Boy Scouts inflated black membership numbers to 20,000 to gain more donations. A civil rights leader contends there are no more than 500 blacks actively involved.

©365Gay.com 2005

Wikipedia: Boy Scouts of America

Wikipedia: Scouting in Alabama

ALABAMA Boy Scout Council History