The problems that put Oral Roberts University into recent headlines pale in comparison to Tom Monaghan's manipulation of Ave Maria enterprises for his personal, business, and banking interests. Monaghan's management is far more repugnant given its scale, financial scope, coercive nature, and depth of self-servitude.

A central charge against Robert Roberts, President of ORU, is misuse of university funds for personal interests. "University funds" are donations made to a non-profit institution by supporters; except for some guidelines, donors relinquish control of their money to a university. It becomes a university asset.

That is not how Tom Monaghan "gives". In fact, he does not "give" because he fails to relinquish even the smallest bit of control. Tax-exempt money from Monaghan's Ave Maria Foundation is circulated back into his direct control as Chairman/Chancellor at Ave Maria University (AMU) and Ave Maria School of Law (AMSL). He even shares the same CFO between the Foundation, AMU, AMSL, his Florida bank, and his multiple for-profit Florida businesses (via Nua Baile). It would be difficult to imagine a more egregious example of personal interest driving the misuse of a non-profit than for a person to shut-down a highly successful school under his chairmanship in one state (AMSL in Michigan) and uproot it to his for-profit real estate development in another state (south Florida's Ave Maria Town) - a move that directly benefits his other Florida businesses and his chairmanship in a pre-existing non-proft (Florida's AMU) - all while causing chaos for the once-successful institution and its alumni (Michigan's AMSL). AMSL's shutting-down in Michigan and starting-up in Florida may means millions for Monaghan, from condo sales, to land appreciation, to more utility hookups (Monaghan even has a stake in Ave Maria Utilities in Ave Maria Town). It makes the $800 bathtub that ORU put into Richard Robert's house look like peanuts.

But given the recent bubble burst in Florida real estate, Monaghan's land speculation might not make much in the end. The success of AMSL's move from Michigan to Florida is predicated on cash from home sales, not on the Law School's internal success. Chaining the school's future to unrelated businesses, a single decision maker, and unrestrained market forces is the game that this billionaire is playing. The volatility for AMSL is compounded because Monaghan has yet to show any hard guaranteed financial commitment for the school when it gets to Florida. Institutions of higher education should not be the toys of an uber-wealthy businessman with a high school diploma.

Some have argued that Monaghan should be allowed to "spend his money as he pleases". To do so is to disregard restrictions on non-profit and for-profit governance, and the fiduciary obligation to avoid conflicting interests. Tom Monaghan's giving back to himself (i.e. from AMF to AMSL), and his use of non-profits to directly benefit his for-profits, make him a rogue philanthropist of the highest order. He demonstrates nicely why a model founded in self-interest breeds abuse, unaccountability, dysfunction, and failure.

Commonalities Between Monaghan/Roberts:
+ At ORU, Richard Roberts is President; the school's founder, Oral Roberts, serves as Chancellor. Richard Roberts is also Chairman and CEO of Oral Roberts Ministries. Tom Monaghan is Chairman of the Ave Maria Foundation (AMF), an organization that is also run like a one-person "ministry". Monaghan also serves as founder/Chancellor of his Ave Maria University, and as founder/Chairman of Ave Maria School of Law. The Ave Maria presidents are lawyers under Monaghan's direct control; these president-lawyers assume an attorney-client relationship with the Chairman of the supporting "ministry" (Monaghan-AMF).

+ The recent suits against Roberts and Monaghan were each filed by 3 fired professors claiming whistleblower retaliation and breach of contract.

+ The Roberts and Monaghan suits each claimed that their respective institution's nonprofit status was violated. Roberts' case involves a political campaign while Monaghan's involves abusing a Michigan non-profit (i.e. Ave Maria School of Law) to benefit Monaghan's other Florida non-profits (i.e. Ave Maria University), for-profits (i.e. Nua Baile and Ave Maria Development), and personal interests (i.e. Monaghan's private land holdings). See also "Non-profit Watchdog Aims At Ave").

+ The Roberts suit involves accusations of inappropriate sexually-related activity on university grounds, using university resources. The Monaghan suit involves worse accusations: "In 2006, Plaintiff Safranek discovered even more disturbing activity. Based on discussions with law school employees and reports prepared by the Michigan State Police, he concluded that certain staff at Defendant Ave Maria School of Law used their positions and law school resources to obstruct a criminal investigation into a priest’s alleged involvement in sex offenses, including possession of child pornography. At the time of this involvement of law school staff and resources in assisting the accused priest, the matter had been under investigation by the Livingston County Prosecutor’s Office, the Michigan State Police, and/or the Michigan Attorney General’s Office. Defendant Dobranski became aware of the issue, but refused to alert any law enforcement agencies of the role Defendant Ave Maria School of Law had played in possibly obstructing an ongoing criminal investigation. Plaintiff Safranek filed a report with various law enforcement agencies regarding his knowledge of the efforts to obstruct the criminal investigation into the priest’s alleged involvement in sex offenses. The actions of Plaintiffs have led to ever-increasing retaliation, including disgusting and false smears upon Plaintiff Safranek’s character." See AveWatch's BoysCherries story - background, details, series

+ Both Roberts and Monaghan have an odd obsession with money and a personal Divine calling for their academic enterprises. In 1987, Oral Roberts claimed that God would kill him if he didn't raise $8 million for ORU. The recent complaint filed against Monaghan alleges that a justification for the uprooting of Michigan's Ave Maria School of Law to Monaghan's south Florida Ave Maria Town is that "the Virgin Mary, whom Catholics revere as the Mother of God, personally directed him to develop Ave Maria Town and Ave Maria University in Southwest Florida." See also "Give For the Good of Your Soul" and "Ave Maria Cult of Personality".

+ Both Roberts and Monaghan foster charismatic Christian experiences (public healings through channeling; being "slain in the spirit"; speaking in tongues; happy clappy music at liturgy/worship).

+ Despite the small size of their respective universities, both Roberts and Monaghan conduct school business using a private jet.

+ Both Roberts and Monaghan appear to lack financial accountability. The Roberts suit cites many accusations of university misappropriation for personal interest - i.e. "The Roberts home has been remodeled 11 times in the last 14 years. Each time, Mrs. Roberts demands more changes." Similarly, the former CFO of AMU said, under oath, "Mrs. Healy [wife of AMU President Nick Healy] had spent $90,000 using the College’s credit card in order to furnish the [President's] house without prior authorization or knowledge by me." This same CFO also brought to light a questionable payment of $240,000 made to AMU's then-Provost Fr. Joseph Fessio: "When I inquired as to why there was no liability on the financial statements for that, I was told [by Ave administrators] that the liability was, quote, off balance sheet." What else does Monaghan keep "off balance sheet"? More on the former CFO's testimony can be found here; there are stunning accusations of FERPA violations and preferential treatment given to a banker-friend to manage Ave Maria student loans. Many unconfirmed reports of wasteful spending have been sent to AveWatch, including multiple reports from former AMU employees that $30,000 was spent on a dog house for AMU's bulldog mascot.

+ Within their respective entrepreneurial fiefdoms, both Roberts and Monaghan appear to have excessive control over their institution's Board. In the suit, Roberts is quoted as follows concerning ORU's Board: "I have the deck stacked - I am elected to three year terms and if a Regent appears to give me trouble, I remove him. I stack the deck..." AveWatch readers will recall AMSL cofounder and former Board member Charles Rice's controversial removal (1,2,3), as well as Monaghan's other Board manipulations (1,2,3,4), including his use of a small "Executive Team" at the Ave Maria Foundation to make decisions for one school based on factors involving another school.

+ Monaghan and Roberts share tastes in architecture. ORU has its futuristic Prayer Tower while Monaghan has his giant Oratory shaped like a salmon steak. Neither structure is formally recognized as a Catholic Church. Monaghan wants to build the world's largest crucifix on his campus while Roberts has the largest (60-foot-tall) praying hands statue on his campus. The estimated value of ORU's buildings is over $250 million, the same amount that Monaghan claims to be investing into AMU.

Differences Between Monaghan/Roberts:
+ The ORU Board is not chaired by Roberts (Oral or Richard). In fact, the ORU Board Chairman is actively investigating matters using independent third parties - lawyers and accountants - to review and audit the allegations. President Richard Roberts was put on a leave of absence, with his duties given to a Board member. The ORU Chairman is also communicating directly to constituents and the local community, recognizing that "our precious students, faculty, and staff have all suffered". In contrast, Ave Maria Foundation, Law School, University, etc. are all Chaired by Monaghan. His Boards have ignored multiple faculty and alumni votes of no-confidence against the AMSL President. In fact, Ave Maria administrators have initiated a contemptuous campaign of disengagement and intimidation (1,2,3,4,5,6,7) against constituents.

+ ORU is showing transparency by releasing statements from all involved (including the allegations) and by hiring independent third party investigators. ORU's governing board has become "hands-on". Ave Maria, on the other hand, ignores calls for independent outside investigations, releases few details to the public, and lets Monaghan and his lawyer-president run unchecked. This includes the crushing of students and alumni who publicly ask for answers and state opposition to Monaghan's governance and treatment of employee. Requests from a former AMSL Board member to secure new independent investigators for the BoysCherries scandal were denied.

+ The ORU "Golden Eagle" mascot is related to the university's location/wildlife on the Oklahoma prairie. It makes sense. In contrast, AMU's mascot relates to, and makes sense to, just one person - Tom Monaghan. The Ave Maria Gyrenes (short for GI Marines) reflect Monaghan's three years of military service immediately after high school, 50 years ago (1956-1959). Of that service, Monaghan said: "When I was in the Marine Corps, I was aboard a ship in the Pacific doing something I've always done a lot of: day-dreaming. I was thinking about my future, the lifestyle I was going to have, all the cars and the beautiful home and the yachts and the airplanes. I wasn't sure it was going to happen, but it wasn't any fun doing this daydreaming if it wasn't possible. I saved half the money I made in the Marine Corps, but it went to a con artist with an oil-drilling scheme." (Fortune Small Business, September 2003)

+ It is only a matter of time until Monaghan, like Roberts before him, goes on the Larry King show to "set the record straight" (Richard Roberts interview here and here).

A former insider in the Roberts ministry recently said "What others may call extravagance, he (Richard Roberts) may not see as extravagant." (CNN, Oct. 10, 2007). How much more distorted is the perspective of a billionaire and his ministry?

Benjamin Franklin wrote "Sell not Virtue to purchase wealth, nor Liberty to purchase power." When will conservative Catholics stop giving their virtues as cheap barter to access Tom Monaghan's wealth? When will students and employees stop giving their liberties as cheap barter to access his idiosyncratic self-interested power? Whatever degree of disconnected megalomania and kookiness that conservative Catholic supporters of Tom Monaghan might see in Richard or Oral Roberts, they fail to see in their own man Monaghan - another entrepreneur of religion, but with significantly more money, more control, and less charisma.

Tags: accountability, conflict-of-interest, environment

[This is a follow-up to last week's news post "Lawsuit Filed Against Monaghan/AMSL". Start there.]

Naples Daily News (Florida) excerpt from article last week:
"The heart of the suit, Gordon said, is Monaghan’s involvement in multiple organizations including those in which he has a financial stake. That involvement violates the law school board’s independence from Monaghan’s “tentacles.”
“We think we can prove the illegal acts by showing the connections between Monaghan, the board and his other organizations,” she said. Gordon said she planned to depose Monaghan, Dobranski and various past and present members of the school’s board, which currently includes high-ranking Catholic Church officials such as, Cardinal Edward Egan, the archbishop of New York and Cardinal Adam Maida, the archbishop of Detroit."

Finally.

This is the itch that AveWatch has been scratching for over a year, and the big story that nobody in the main stream media will mention. Ample evidence demonstrates that, for years, Tom Monaghan has coercively used the Ave Maria Foundation to improperly create and run other non-profit and for-profit ventures that are managed centrally on Monaghan's whim rather than as independent autonomous entities. Through financial coercion, he forces the recipients of his "philanthropy" to put duty to Himself above fiduciary duties to the organization. Tom Monaghan's good supersedes all other duties in these organizations. Monaghan's person, his Foundation, and his for-profit Florida businesses - including his mega-development Ave Maria Town - have benefited at the expense of Michigan's Ave Maria School of Law, Ave Maria College, and their respective alumni, employees, donors, and students.

For a wide-angle view of such evidence, start at AveWatch's "Must Read" and Quotes pages. Individual stories are also categorized by "topic" (i.e. "School of Law") or by "tags" found in the right menu bar's bottom (i.e. "conflict-of-interest").

For a more focused view of the issues specifically mentioned in the Law School suit filed yesterday, consider the following:

Treatment of professors Safranek, Lyons, Pucillo
+ background here; details & developments in series "Dean Runs Amok"

AMSL's help given to a local priest investigated for child pornography, hidden from police
+ background here; details & developments in series "BoysCherries"

Tom Monaghan benefits significantly in ventures unrelated to the Law School by forcing the institution to move to his south Florida real estate development, Ave Maria Town, or face closure.
+ Monaghan personally owns a large section of the Town's prime real estate.
+ Monaghan and his AMSL CFO Paul Roney will benefit significantly by the Law School's move to Florida through the twosome's quiet private for-profit business (Nua Baile), hidden as a partner in Ave Maria Development, the lone real estate business that controls Ave Maria Town.
+ Monaghan is a partner in businesses hand-picked to benefit from Ave Maria Town's growth - from road and home construction materials to condo sales.
+ Monaghan helped start a bank specifically designed to benefit from Ave Maria Town growth (see also)

Ave Maria School of Law may, by design, have no long-term financial plan apart from Tom Monaghan's Ave Maria Foundation.
+ Former AMU CFO Speaks : shocking testimony under oath
+ Falvey: Monaghan $ Destabilizes AMSL
+ Dobranski Credibility Bottoms
+ AMSL Financial Stability Questioned

Ave Maria has engaged in questionable financial dealings.
+ Ave Maria Helps Democrat Financier
+ Fr. Fessio's Bank Account
+ AMSL Study Forgets Michigan Tax-payer
+ AMSL Balance Rises on AMF Loan
+ Nicaragua's Financial Aid Irregularities
+ AMU Accreditor Still Fumbling

Tom Monaghan populates his Ave Maria boards with individuals beholden to him.
+ Follow the Money, Find Board Members
+ Catholic Education's Version of The Borg
+ AMSL Board Reels With Change
+ Accreditation, Boards, and Conflicts
+ Healy: The Decision Was Monaghan's
+ Call the Media, *Then* Vote: this is an important story to show how grandiose plans to announce the Law School's Florida move were initiated long before the School's Board deliberated and voted on the move
+ Burtchaell: "Obvious Impropriety"

Ave Maria administrators use a culture of intimidation to maintain Monaghan's control.
+ AMSL Intimidates Honor Student
+ Monaghan Security Watches Professor / Town
+ Woman Kneels Before Monaghan
+ Fabricating an Air of Sexual Harassment; Intimidation and Uninvited Touching?
+ Dean Retaliates Against Whistleblower
+ Ave Prof Complains to DOE / Embassy (also Ave Prof Gets Partial Restitution)
+ Dean Takes Marbles Home w/Alums
+ Admin Thugs Whack Student Critic
+ Admins: School is "Failed Experiment"
+ Monaghan Preps for Supreme Court
+ Fessio Fired
+ AMU Students "Beg" to Leave
+ AMU's "Climate of Fear"
+ AMSL Railroads/Misrepresents Alumni
+ Catholic Social Teaching
+ Faculty Coerced
+ Rice Dismissed

hat-tip: ThePolitic.com

Tags: lawsuit

The following is, by far, the most commonly heard "insider" story concerning Tom Monaghan. Ask a past or present employee from any of the Ave Maria entities about this story, and he or she will probably be familiar with it. Multiple current and former employees have offered AveWatch corroborating accounts. Yet, to date, it remains unpublished.

Tom Monaghan is a staunch believer and enforcer of dress codes, particularly for women. In large and small meetings, Monaghan has been asked by female employees if they could wear slacks in lieu of the required skirts/dresses on winter days when bitter sub-zero wind-chills whip through Michigan. This was a significant safety concern for women who needed to do regular travel on the snow-covered roads of Michigan as part of their employment responsibilities. Monaghan's response was a consistent "no" to slacks; however, he would "allow" women to wear slacks into and out-of the building if they immediately changed into their dress in the bathroom upon entering the building.

But, requiring a dress or skirt was not enough for Mr. Monaghan. It had to be of a 'proper' length at/below the knees.

Shirley Daum was a married mother who worked at Domino Farms. According to co-workers and friends, she was a solid employee who "always acted professionally" and was "a cheerful and delightful person to be around". As the account goes, in Mr. Monaghan's outer office area, he noticed one day that Daum was wearing a skirt whose length might not have met the knee dress code. In the presence of other employees, Monaghan then proceeded to tell Daum to kneel in front of him so that he could determine whether the skirt touched the floor and was subsequently in compliance with the dress code.

Can you imagine the humiliation of a married woman being told by her boss to kneel in his presence, in front of co-workers? To be clear, AveWatch is not implying that the instruction to kneel was done with sexual intent. But, it doesn't need to be overtly sexual to be humiliating. It should also be remembered that a perpetrator's private "intent" is not necessarily transferable to a participant or observer who may have very different perceptions about the intent.

AveWatch asked Daum's former co-workers if she did anything to provoke such treatment, or if she dressed provocatively? "That depends upon whose definition of 'provocative' you're referring to," said a current employee who wished to remain anonymous. "It seems that anything straying from drab 'Catholic Amish' garb doesn't fit with Mr. Monaghan's taste for women and is thus 'provoking'. He appears to be intimidated by attractive women who dress smart, sharp, or snappy. I would not call her dress provocative by any normal person's definition of the word." Former employees corrobrate this account, telling AveWatch that Daum "always dressed very professionally".

There is a great contradiction between Monaghan's apparent need to exert control over his real-life local female employees and with his willingness to interview for a sexed-up fantasy-making magazine like GQ.. a magazine that he'd likely not tolerate a female employee posing for (or a male employee reading while at Ave Maria). A popular story, told with a chortle, at Ave Maria School of Law is Monaghan's yearly suggestion to students that they spend $10,000 to get their wardrobe started. His focus on clothes adds to the notion that Monaghan is perpetually more concerned with style and perception over substance.

AveWatch readers should ask which of the following begins to rise to the level of harassment and "intimidation" - a pat on the arm with a smile and 'Good morning', or telling a subordinate to kneel in the presence of co-workers?

Tags: employee-treatment

This website offers to shut itself down as part of a solution to be brokered.More...

"Assimilate." The Oxford American Dictionary definition is "to absorb or integrate and use for one's own benefit".

Tom Monaghan has done it quite well, laying claim to the careers, sacrifice, and dedicated work of many Catholic educators, staff, and students.

Despite the rising mass of individuals who are now making known their opposition to Monaghan's conflict-laden approach to higher education governance (1,2,3,4,5,6,7...), relative silence is heard in public from conservative Catholic academic circles.

Well, they'd better wake-up before resistance is futile. New evidence shows that Monaghan's tentacles of influence are reaching beyond his Ave Maria "brand". For an examination of that influence, click "More..." below.

More...

Tags: accreditation, conflict-of-interest

Word is spreading. The website "Where Most Needed: The Charity Industry Observer" recently turned its watchful eye to Tom Monaghan's Ave Maria Foundation. The site is run by a former executive director for the National Council of Nonprofit Associations. Excerpts:

We have noted that short board tenure is a factor leading to the unaccountability of charity organizations, especially if other key players have an indefinite term.

The Ave Maria Foundation (EIN 38-2514364 Form 990) as of the end of 2005 had assets of "only" $121 million, but there's more where that came from. The foundation's report indicates that it made a $20 million payment in start up costs for the Florida location of Ave Maria University and has pledged $114,750,000 in future support.

To me it is telling that the foundation [IRS tax] return was self prepared by the treasurer of the foundation, which suggests that the organization is unaudited, despite its size.

"Faculty at Ave Maria Law School Fights Founder's Flighty Vision" - here

[Side note - The reorganization of Michigan's nonprofit structure may be of interest to some.]

Tags: accountability, conflict-of-interest

According to the New York Times (July 30, 2006), long-time Ave Maria Board-member favorite Bowie Kuhn said "This is not a bunch of trained dogs.." in defending against Ave boards that appear to act as rubber stamps for Tom Monaghan. Other Board members have offered similar defenses over the years in popular media.

But evidence to the contrary exists within the walls of Ave Maria itself.More...

Tags: conflict-of-interest, accountability

"AMU does not behave like a Catholic employer. "
- former AMU Chairman of the Department of Economics (Dec. 2005)More...

Tags: accountability

Students and parents of Ave Maria University/College/School of Law might be interested to know how profits from their federal student loans landed in the campaign coffers of Hillary Clinton, Ted Kennedy, and the DNC. It happened thanks to AMU's Nick Healy and Fr. Fessio, who allowed one of their long-time banking associates to turn Ave Maria into a lender's playground for his Miami-based finance company. More...

Tags: accountability, conflict-of-interest

Fr. James Tunstead Burtchaell is as big as they come in Catholic higher education. He served as an administrator and trustee at Notre Dame, and authored a highly regarded book on the sources of decay within Catholic universities. Fr. Burchaell was invited as a consultant, spending several days reviewing documentation and interviewing administrators, faculty, and Tom Monaghan. Burchaell's findings and suggestions echo those of Ave Maria School of Law co-founder Charles Rice to Monaghan. Also included in this post is "The Martin Report", a 2003 study from AMC Board member Ralph Martin that identified "widespread frustration" with administration. With all these sage warnings, Monaghan should not expect sympathy if the Ave Maria 'brand' collapses.

"... it would be both wise and necessary for Mr. Monaghan to resign from the board"

"The board of trustees has functioned under several handicaps. The most immediate one is a pervasive conflict of interest. "More...

Tags: conflict-of-interest

Sworn testimony from a former AMU Chief Financial Officer makes strong allegations on whether Tom Monaghan and his Ave Maria Foundation are properly treating the targets of his/its philanthropy as the independent non-profit institutions they claim to be.

"That (the examination of student files) was brought to my attention, which was very troubling because that’s a violation of FERPA laws. No one who’s a lender should have the right or access to those particular files."
"Someone, if they wanted to bring a legal claim against any one of the (academic) organizations, could sort of go right to the Foundation."

"Mrs. Healy had spent ninety thousand dollars using the College’s credit card in order to furnish the house without prior authorization or knowledge by me."More...

Tags: conflict-of-interest, accountability

Did Ave Maria University break U.S. Department of Commerce regulations governing the use of .edu domain names?More...

Tags: accountability