Originally published February 24, 2011 at 10:44a.m., updated February 24, 2011 at 06:40p.m.
Ben Kirtland knew the law was coming and quickly amended three previous years of tax returns to reflect his own increased income from handling Kansas University football and basketball tickets.
But even in making such financial adjustments for the 2006-08 tax years, Kirtland — then the lead fundraiser for Kansas Athletics Inc. — didn’t go far enough.
“When he filed those (amended) returns, he claimed he’d ‘inadvertently’ failed to disclose income from those years,” said Richard Hathaway, assistant U.S. attorney, who detailed Kirtland’s underreporting during a hearing Thursday in U.S. District Court in Wichita. “In checks only, he underreported $39,000.”
The inaccurate tax returns — Hathaway said that the initial returns left out at least $120,000 to $216,000 — formed the basis for Kirtland pleading guilty Thursday to conspiracy to commit wire fraud. The charge stemmed from a scam that a KU investigation determined had involved several employees conspiring to steal and profit from the sale of about 19,000 tickets for regular-season football and basketball games from 2005 to 2010.
Like four co-conspirators who pleaded guilty before him, Kirtland faces up to 20 years in prison, a $250,000 fine and a monetary judgment that would require him to share responsibility for forfeiting up to $2 million in ill-gotten gains.
“Ben has today publicly admitted his guilt and deeply regrets his unlawful acts, as well as the embarrassment his actions have brought to his family and to the University of Kansas,” said Robin Fowler, Kirtland’s attorney, after the 29-minute hearing. “He wishes to apologize to everyone he has let down by his conduct.”
U.S. District Judge Wesley Brown, who accepted Kirtland’s plea, set sentencing for 10 a.m. May 12 in Wichita.
He becomes the fifth and final former Kansas Athletics employee or consultant to plead guilty after being charged in federal court with conspiracy. The others, all awaiting sentencing:
After Thursday’s hearing, Hathaway declined to discuss whether the federal investigation would continue.
Kirtland is the highest-ranking former employee to be charged in the scam. He worked at Kansas Athletics as associate athletics director for development, making him the top fundraiser for the department.
In court documents, Kirtland estimated the total value of tickets he’d sold as “in excess of $120,000,” and that he’d shared proceeds with a codefendant.
“I knew that neither I, nor the person with whom I shared the proceeds, was legally authorized to sell these tickets; and by selling these tickets and keeping and sharing the proceeds I acknowledge that I was conspiring to commit, and committing, a fraud upon the University of Kansas, and Kansas Athletics Inc.,” Kirtland said, in his written guilty plea. “… I was aware that there was a lucrative market for KU tickets, and that these tickets were often sold by ticket brokers who advertised and sold tickets online.”
Kirtland also admitted receiving payments in cash and by check, and then converting checks into money orders to avoid detection. He failed to report his extra income on either his tax returns or NCAA-required documents outlining “outside income.”
Unlike his fellow co-conspirators, Kirtland did not enter a plea agreement with prosecutors. Others had agreed to cooperate with investigators, disclose all sources of income and submit to polygraph testing, if necessary, as part of ongoing investigations, if any.
As it stands now, authorities aren’t sure exactly how much money Kirtland left off of his amended tax returns, or how much he received as part of the scam.
“We’re still checking,” Hathaway said, after the hearing. “We’re still looking into that stuff.”
Authorities have said that two victims in the case will expected to be eligible for receiving money through forfeiture or possible restitution: IRS and Kansas Athletics.
Jim Marchiony, an associate athletics director, reiterated that decisions about whether to pursue any payments from such funds would not come until the legal process had run its course.
“The process is not over until all the sentences have been handed down,” he said Thursday.
The department is still awaiting word on a $250,000 insurance claim filed in October on a policy taken out to protect against losses suffered as a result of employee theft.