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Romney hired to lead Salt Lake Games from scandal

HDN | 2/13/1999 12:00:00 AM |

Shakeup begins at Salt Lake Olympic committee Salt Lake City- The Associated Press With a new boss and an organizational shakeup, Salt Lake Olympic officials promise to put the bribery scandal behind them and focus on "athletes and altruism." Mitt Romney, a venture capitalist who turns around troubled companies, was hired to do the same for the 2002 Winter Games, which have been paralyzed by ethical misconduct that has scared sponsors and shaken the Olympic movement. "These games and the

  • Shakeup begins at Salt Lake Olympic committee
  • Salt Lake City- The Associated Press

    With a new boss and an organizational shakeup, Salt Lake Olympic officials promise to put the bribery scandal behind them and focus on "athletes and altruism." Mitt Romney, a venture capitalist who turns around troubled companies, was hired to do the same for the 2002 Winter Games, which have been paralyzed by ethical misconduct that has scared sponsors and shaken the Olympic movement.

    "These games and the preparations leading up to the games will comply with the highest level of ethical conduct," Romney vowed. "There is absolutely no excuse for the compromise of principles." The Salt Lake Organizing Committee also revamped its leadership, pledged to open up its meetings and records, and accepted the resignations of three key members - two of whom had perceived conflicts of interest.

    Romney's selection will help move the Olympics' focus from "money and materialism back to its roots of athletes and altruism," Gov. Mike Leavitt said. Romney, whose ancestors were Mormon pioneers, was the clear choice of Leavitt and SLOC Chairman Robert Garff. The Mormon church is headquartered in Salt Lake City, and some 70 percent of Utah's population is Mormon.

    Executives of Salt Lake's bid committee have been blamed for giving more than $1 million in cash payments, bogus scholarships, shopping sprees, vacations and free medical care to 24 International Olympic Committee members in exchange for getting the games. So far, four IOC members have resigned and another five have been expelled. New evidence against one of those 24 - Kim Un-yong - will be reviewed by an IOC panel, said Richard Pound, the lead investigator for the IOC.

    Kim, one of the most powerful IOC members, will have a chance to explain details of Salt Lake's ethics report tied his son to a $75,000 telecommunications job directly funded by Salt Lake Olympic bid executives. Kim already was under investigation by the IOC because the bid committee allegedly helped him secure a U.S. visa for a Russian student and may have helped his daughter land a piano recitals with the Salt Lake Symphony.

    Also, IOC member Jim Easton said his company, at the request of the Salt Lake bid committee, hired the son of IOC member David Sibandze of Swaziland, who resigned last month. "We were doing a favor for the bid committee. In hindsight I wouldn't do it," said Easton, one of the United States' two IOC members. Easton, who also serves on the SLOC, said he did not consider it unethical because Sibo Sibandze actually worked and Easton Aluminum paid his $9 per hour wages for errands, research and office help in 1995. Pound, who met with sponsors in New York, said there was no indication corporations were considering pulling out.

    "The sponsor group has been very good, proper and businesslike," he said. "They say, 'We understand you have problems, we appreciate what you are doing to clean up and we are supportive of your efforts to do it." Romney said he has little doubt corporate sponsors now wary of supporting the Olympics will jump at the chance to sponsor the first United States Winter Games in nearly two decades.

    David D'Alessandro, president of the John Hancock insurance company, has protested the OIC's failure to deal with the scandal. Rob Baskin, a spokesman for Coca-Cola, said his company's "commitment to the Olympic Games and Olympic athletes has not flagged. "We do, however," Baskin continued, "want to be certain that the current scandals being investigated are resolved and processes put in place to insure that they won't happen again." Selling the 2002 Winter Games to corporate sponsors will be a big part of Romney's focus. Besides unanimously approving Romney as its new chief executive and president, the committee endorsed sweeping plans for higher ethical standards and openness.

    Acting on proposals by Leavitt and Garff, SLOC approved expanding its board of trustees from 33 to 50 and stripping it of its decision-making authority, making it an advisory board to a new management committee of 20. Leavitt gave any SLOC member with a perceived conflict of interest 60 days to resign. Two SLOC trustees directly affected - Earl Holding and Alan Layton - immediately quit. Layton's construction company won a $29 million contract to enclose the speedskating oval.

    Holding owns Snowbasin Ski Area, which will get $13.8 million to host Olympic ski events, and Little America Grand, a hotel that is expected to be the IOC's home during the games. Also resigning was Verl Topham, president of Utah Power, saying he was doing so for the good of the games. Topham was among the SLOC members who also served on the bid committee board, which was criticized in an ethics report Tuesday for failing to oversee zealous executives. Romney, owner of Bain Capital Inc. in Boston, was portrayed as just the leader Salt Lake needs. "It sounds to me like a great choice," Pound said. Romney said he doesn't believe the Olympic movement will be permanently stained by the scandal. "The managers have messed up big time.

    The athletes haven't," he said. "Our job is to go to work for the athletes." Romney pledged to spend no more money than the games take in, to spare taxpayers, to protect the environment and to take no salary until the Olympics are over and profitable. When he is paid, it will be $285,000 per year - the same rate as his predecessor, Frank Joklik, who resigned Jan. 8. Joklik claimed to know nothing about the excesses of bid executives while he served as chairman of the committee. He will remain on SLOC's board of trustees. Romney will have to sever ties with any companies that do business with the games. Bain Capital has ownership stakes in many companies and Romney serves on various corporate boards.

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