USOC's Ward Facing Hearing

By Alan Abrahamson

Dec. 30, 2002 12 AM PT

Times Staff Writer

Lloyd Ward, the U.S. Olympic Committee’s chief executive, directed USOC staff to help his brother’s company in its bid to procure a potentially lucrative deal to provide power generators to officials in the Dominican Republic, the electricity-starved site of the 2003 Pan American Games, according to a review of key documents and interviews with figures close to the negotiations.

With ethics and perhaps legal concerns triggered, the USOC will announce today that it has called a Jan. 13 hearing, probably in Denver, at which Ward’s future as CEO is the sole item on the agenda.

The USOC is likely to consider the following:

* In April, Ward directed the USOC’s then-director of international relations to see him about a proposal Ward first received in February on behalf of Detroit-based Energy Management Technologies (EMT). Thereafter, following introductions to officials in the Dominican Republic made by that USOC official, the company went on to propose it supply “microturbines,” which provide stand-by power, to the 2003 Pan Am organizing committee. Through the months, the numbers of turbines, and thus the costs, varied, but one proposal called for 53 machines at $4.6 million.

* On file in the USOC’s Colorado Springs, Colo., offices is a statement Ward signed July 1 in which he declared he had no actual or potential conflicts of interest for calendar year 2002. Lloyd Ward has no financial interest in EMT. Ward’s brother, Rubert, is identified on at least two EMT documents as the company’s president.

* Two weeks ago, at a meeting in Santo Domingo, the capital of the Dominican Republic, an EMT official, Lorenzo Williams, offered 5% of a deal as “appreciation” to two top executives of the organizing committee. A Dominican official at the meeting, who in an interview Sunday characterized the offer as a “bribe,” said he emphatically refused it, adding that no contract with EMT has been signed and none will be. Williams denies offering any bribe; on Dec. 17, meantime, he wrote a letter apologizing for his “most egregious and inappropriate offer.”

Ward, who has proven to be tenacious and resourceful in the behind-the-scenes politicking that marks USOC affairs, did not return a phone call to his Florida home seeking comment. His wife took a message.

The USOC thus seems poised to plunge yet again into distraction and turmoil. It has for years been plagued by management turnover, and recent years have seen episodes of ethics-related controversies.

In May, for instance, Sandra Baldwin, who two years earlier had been elected the USOC’s first female president, resigned after admitting to discrepancies in her USOC biography. She had listed a doctorate in American literature that she didn’t earn.

USOC President Marty Mankamyer said Sunday that “the allegations and issues” about Ward “are both serious and disturbing,” adding that the USOC is “held to a high standard.”

Ward, a former Maytag CEO hailed as a marketing expert, came to the USOC 14 months ago.

The U.S. team won a record 34 medals at the Salt Lake Games in February. But the USOC has announced few major corporate sponsorship deals since.

In addition, Ward has for months been a focus of attention as one of a handful of African American members of Augusta National Golf Club, site of the Masters. The club does not have a female member. In an Oct. 7 statement, Ward pledged to “aggressively work” for reform from within and on Nov. 1, the USOC’s policy-making executive committee issued a statement supporting Ward’s “principled position on the issue.”

That statement was timed, however, to ensure that the Augusta issue did not deflect attention from the USOC’s Nov. 2 vote at which New York was picked to be the U.S. candidate for the 2012 Summer Games. The International Olympic Committee will pick the 2012 site in 2005.

The 14th edition of the Pan Am Games is scheduled to be held Aug. 1-17, 2003, in Santo Domingo; the Games serve as a year-before warmup for the Summer Olympics and attract thousands of athletes from the Western Hemisphere.

Preparations for the 2003 Games have taxed the small island nation. The Games are projected to cost at least $120 million, not including an athletes’ village, estimated at another $40 million.

The country has long been plagued by electrical blackouts. In a letter dated Feb. 19, signed by Williams and by Rubert Ward, EMT solicited an investment of $150,000 from Lloyd Ward, saying it saw a market for microturbines in the Caribbean, particularly the Dominican.

“He turned me down,” Williams said.

In at least two company documents, Rubert Ward is identified as EMT’s president, Williams its CEO. Williams said Sunday he is currently president and CEO and that Rubert Ward “has no title now,” adding, “EMT has basically been me because we haven’t had the financial capability to pay Rubert.”

Rubert Ward did not return calls Sunday seeking comment.

On April 2, Lloyd Ward sent a handwritten note to Hernando Madronero, at the time the USOC’s international relations director, that -- in an apparent reference to EMT -- said, “This is an interesting proposal that could be beneficial for the 2003 Pan Am Games. Let’s discuss. Come see me this week,” the “this week” crossed out and replaced by “today.”

Madronero then put Rubert Ward in contact with officials in Santo Domingo, in particular Jose Joaquin Puello, a neurosurgeon who heads the Dominican Olympic Committee and the Pan Am 2003 organizing committee. Later, EMT was introduced to Lowell Fernandez, who is the Games’ project manager. Madronero, whom Ward fired in October, declined to comment.

On July 1, Ward signed a conflict-of-interest form, acknowledging that conflicts, real or perceived, may involve “placement of business in, or favorable treatment of, a firm owned or controlled by a volunteer, family member or personal friend.”

A July 8 letter from EMT to Lloyd Ward, again signed by his brother and Williams, says: “We also want to personally thank you for personally taking an interest in what we are trying to accomplish with both the Games and our project in the Dominican Republic.” A handwritten note on the letter reads, “Hernando -- FYI Lloyd.”

In September, EMT forwarded the $4.6-million proposal to Santo Domingo. “The problem is, we are not interested in buying anything for only 15 days, as you might understand,” Puello said in an interview. “From the very beginning, we told them we were not interested in buying anything.”

On Dec. 13, Williams met with Fernandez in the latter’s office in Santo Domingo. Fernandez, 37, who was recruited from a globally known accounting and consulting firm to work for the Dominican government to try to ensure the 2003 Games’ success, said he recorded the conversation and that Williams did not know he was being recorded.

On the tape, which was played for The Times, a voice Fernandez says is Williams’ is heard saying, “It’s very important to me to get this deal,” and said as “appreciation” he would offer 5% “for you and Dr. Puello.”

There is a pause in the conversation, and then Williams said, “No?

Fernandez can then be heard saying, “I think you should stand up and leave,” which Williams did.

Williams said Sunday, “You let me hear a tape where I said I offered them 5%.” Asked if he had offered a bribe, he said, “No.”

In Williams’ letter to Fernandez, Williams says he was given “very bad advice” by “some of my Dominican associates,” who said “it would be necessary to adopt this practice in order to compete effectively here.”

Williams said Sunday he sent the letter because, “[Fernandez] took it wrong that I was trying to offer him something.”

Asked if he had any doubts about what had happened in his office, Fernandez said, “No, of course not.”