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Published on June 17th, 2014 | by Todd Smekens

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Ball State University Loses Millions – Press Conference?

MUNCIE, Indiana – For a progressive outlet to be delivered such an excellent example to support the decline of journalism and later loss of democracy in this country – it’s like getting two cars for the price of one special. Not an everyday occurrence. Ball State University and the Gannett owned The StarPress (TSP), are presenting the classic scenario of why citizens in the Hoosier state are grossly misinformed – the connection between newspaper and monied interests prevents truth-seeking.

You should read Hoosier School Heist from our friend Doug Martin. Loads of examples why all Hoosiers should boycott Gannett owned newspapers in this state, including The StarPress in Muncie, Indiana and IndyStar in Indianapolis, Indiana.

To be honest, we couldn’t write a better script about censoring information coupled with a lack of journalistic integrity.

Muncie Voice wrote specific articles about the first two acts act of the “The Swindle” here and here, but as we all learned, Ball State lost another $5 million requiring even more whitewashing from Ball State with help from their cohorts at TSP. We asked our colleagues at Muncie Free Press if they received calls or emails from Ball State offering prepared statements, and they said no.

However, as we’ve learned from their prepared releases, employees of Ball State played a major part in the investment losses. We did get a copy of the Betts-Seth-Complaint outlining the general circumstances surrounding the fraud committed.

Last year, the complaint referred to Ball State as the “University”. It states that a former investment director of the University wired a total of $8.1 million to law firms as requested by Betts over a 5 month period in 2008.

Seven months later, in July 2009, the former University director, inquired about the investments. Little did she know, Betts had wired millions from the law firms to auto dealers and real estate brokers.

Then the complaint, filed by field investigator Scott Romanowski with the U.S. Attorneys office, shares that Betts remained in contact with University officials through December, 2012 – three years and six months later “negotiating to resolve the loss of University’s investment, but never once did he mention that he spent the money on himself.” This prompted his arrest.

From reading the complaint, at this point, we know there is plenty more taking place that’s not being disclosed. In fact, Betts arrest and plea was for wire fraud which is why he only received 54 months jail time.

The investment director was fired in October, 2011 for falsifying internal financial records surrounding the investment. According to Randy Howard, Ball State was informed there was a swindle and they were part of it. If this is correct, Ball State was not even aware they had been swindled out of $13.1 million – this is startling.

How do you not know that you’ve lost $13.1 million dollars for over 2 years?

If you bother reading the complaint filed by the U.S. Attorney’s office, you’ll see there are certain connections and facts excluded which probably would tip off a defense lawyer for Betts. We’re guessing, but we think Ball State’s former and existing employees may be facing charges for their own part in the “The Swindle”.

Did the Board of Trustees know about the loss in 2011, 2012 or 2013? Why were they granting raises to the President during this time for losing $13.1 million and not knowing about it? She was great at getting donors to give them money, but apparently not real good at keeping track of the dollars once in-house. Lots of six figured salaries involved in middle management who lost $13.1 million and didn’t even know it.

As mentioned, we’re waiting for requests made to several lawmakers to determine what happened during these long delays and why the insistence Ball State’s name be kept from the complaint, and why the loss was kept from taxpayers the past two years. We’ll also follow-up with a public records request to Ball State.

Another incredulous claim is the former university director involved with scamming the university is married to an existing employee at Ball State, the director of risk management, yet he claims to know nothing about what his wife did. Really? “The Swindle” unfolded over 42 months, and she was responsible for losing $13.1 million, and you want us to believe she didn’t share one word of it to the husband?

He knew she falsified her name when applying for a job there. Was that dishonesty done to get a job at Ball State? Avoid a sketchy personal background?

Let’s take a look at the bigger picture while “The Swindle” continues into the third and fourth acts.

As I stated at the beginning of this article, the primary reason we created an alternative voice in Muncie was to show the people just how bad our information is we get from the Virginia based, Gannett owned TSP. The whole community, and entire state has been duped by these “proffers of journalism”.

Journalism is about truth-seeking and holding government accountable. Both sides of the aisle…no matter how the truth may fall. Our founders gave the press specific powers in our constitution for this very reason. They need the power to face a system of monied interests who use all their power and influence to keep information from the public. All of our systems must have checks and balances. Without them, people corrupt the system.

Albert Einstein, and many other great minds, warned us that Barons of Capitalism will use their money and influence to buy our  government. We need a strong government to keep the Baron’s in their place. We need journalists to keep the government honest.

While the “The Swindle” is largely about Ball State getting duped by a con man, the fact they didn’t know about it for over 2 years is a major embarrassment. They’re claiming the investment officer kept it from them, so she got fired.

However, Ball State didn’t know about it – they were told they got duped by outside investigators, and then started asking questions. Someone was asleep at the switch. I’m guessing there were several “someones” asleep at the switch.

Since we have a Google Alert for Ball State which discovered this whole mess, we’ve also been watching the articles by The StarPress leaking out to other media outlets in Indiana – slowly. They are missing the entire effect of the story because they are scanning the prepared statements made by Ball State and printed by Gannett’s finest at The StarPress.

You’re not seeing “The Swindle” featured in other Gannett owned newspapers across the state.

In fact, if you look at the IndyStar, the Gannett flagship paper in Indianapolis, the only article listed about “The Swindle” is one written by Walker and Roysdon which clearly paints the former university director as a giant fraud. You’d think it would be an easy share from one Gannett platform to another across the state. Mums the word.

How can TSP report about dishonesty within the government when they repeatedly ignore their own journalistic code to keep up their relationship with monied interests in town?

We should all be working together, but we should also be doing our jobs.

If Ball State was simply an innocent victim, they could have reported the loss via a press conference and shared the details of the case. They chose to keep it under wraps and use their relationship with The StarPress to repair the damage their dishonesty created, but even that is backfiring.

Hopefully, the new president will demand some house cleaning and all those responsible for this fiasco be terminated. We also hope he refuses to leverage their cozy relationship with the local Gannett newspaper and opts for press conferences when matters like this arise in the future. It takes integrity to stand in front of an audience who wants the truth to tell readers.

It’s the cowards path to invite one journalist into the room and explain a fraction of the details. Then ask for preferential treatment by avoiding their other news outlets across the state.  Both organizations look bad, but Gannett looks worse since it’s their job to hold them accountable, not polish their image when they screw up.

We would declare it a complete failure, but as we mentioned in our opening, it’s presented us with a classic example of censorship and how collusion between monied interests and “journalism” has destroyed the trust in government and violated a code of ethics established to maintain democratic principles in this country by emphasizing truth-telling to the people you serve – the readers and the community.

Until Ball State grants a press conference, we’ll continue researching the story to get the truth since lawyers are now part of the damage control process. Our experience tells us our phone calls will be ignored and so will our emails and letters.

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About the Author

Journalist, entrepreneur, publisher, DSA member, and ethical leader with a passion for truth-seeking. Enjoy cycling, yoga, meditation, and spending quality time with my daughter. Wellness advocate who practices servant style leadership.


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