By Sean Pendergast
By Sean Pendergast
By Jeff Balke
By Richard Connelly
By Jeff Balke
By Casey Michel
By Craig Hlavaty
By Jeff Balke
"Doug was wild and crazy. Get this done, get that done," says Scotty Sanders. "He did all the flamboyant stuff. Somehow everything would just fall into place."
Or so it seemed. In the last few years, the Classic lost money, and in January 1993, its board of directors ordered an internal audit. The subject was the financial losses, and the audit report detailed several areas of concern within the charity. The expenses were disproportionately higher than the revenues raised for charity, the report read, and "the IRS may allege that an unrelated trade or business activity is being carried on." (Sanders indeed operated several businesses out of the tournament's office, including a company called Fairway Productions.)
In addition, the report stated that "the active participation of both Mr. & Mrs. Sanders as members of the Board of Directors and officers creates an appearance of control and self-interest. It may be appropriate for Ms. Sanders to resign as a Board Member...."
It was after the report came back, says Sanders, that the PGA began serious efforts to get him to take his name off his Classic and put the name of a corporate sponsor up there instead. "[Then PGA commissioner] Deane Beman called me up on the telephone," Sanders remembers. "He says, 'Doug, I can't make you, but I want you to take your name off the tournament.' "
Beman failed to return phone calls from the Press. However, when asked earlier about shifting the emphasis from Sanders to a corporation, Ric Clarson, Senior PGA director of administration, remarked, "This tournament has always been produced with an emphasis on the celebrity end. The tournament needs year-round attention and stability."
Late last February, Sanders apparently took the hint. He held a press conference and announced that the Doug Sanders Kingwood Celebrity Classic would no longer have "Doug Sanders" as part of its name, and that the search for a corporate sponsor was under way. Several insiders close to the tournament insist that Beman mandated the change. But Sanders insists that he wasn't forced out.
"That's a bad term -- 'step down.' It's a negative piece of crap as far as I'm concerned," he says. "I decided in order for the tournament to get bigger, the only way for it to raise more money was for it to get a sponsor.
"I had no problem taking my name off the tournament, if I could've found a title sponsor. If this shit hadn't come up, I wouldn't have had a problem."
This shit," of course, was the Dolcefino series detailing how Sanders' charity tournament wasn't truly about charity, and how the IJG scholarship program wasn't truly about scholarships. To this day Sanders claims he is innocent of any graft that occurred in his tournament. But according to Dolcefino, the Doug Sanders Celebrity Classic is a criminal situation, should the IRS pursue it.
The main alleged illegality lies in Sanders' contract with his tournament. In 1991, the tournament's board of directors -- which then included Sanders and his wife -- unanimously approved a $20,000-a-month salary for Sanders. The contract mandated that out of that money Sanders was to pay his expenses as well as the salaries of the tournament's employees.
But Dolcefino charged that Sanders never wrote personal checks to cover his employees' salaries. "Bullshit," Sanders says when pressed about that claim. "I never wrote any of the checks." A review of the tournament's files, though, shows that claim to be not completely accurate. Sanders did indeed sign some tournament checks, and never forgot to sign his monthly paycheck.
Under his contract, Sanders bore a financial responsibility if the tournament lost money, as it did for each of the last three years. "The real contract called for him to get a third of the revenues of the tournament," says former Classic director Rod Kelley. "But he had to turn around and use those revenues to pay for the staff and all the overhead items. If there was anything left over, then Doug got it."
Kelley estimates that if Sanders had managed the money properly, he could have pulled down at least $75,000, if not $125,000, for his work on the Classic. But Sanders apparently failed to comply with his contract. Dolcefino reported that Sanders owed $110,000 to the tournament (he has since paid the money back) and that he misbilled the tournament for over $51,000 in additional expenses.
Sanders disagrees with the image of him plundering his own tournament. "If I misused any of the funds, that's besides the point," he says with either astonishing candor or astonishing naivete. "You can pick on any little bitty thing. Do you wipe your mouth this way or that way?" Sanders contends that his $240,000 annual salary was easily justifiable -- he was the one, after all, who took no paycheck from the tournament during its first ten years, a period in which he estimates that his annual compensation from the Classic was $34,650.
In the early '80s -- when, because of rainouts, the tournament also lost money -- Sanders claims he paid for the losses out of his own pocket. "That was almost the end," he says, once again clutching his neck. Sanders doesn't like to talk about money. Other people's salaries, he says, are immaterial. "My secretary called me up and said [the tournament is] $50,000 short. I'd call the bank and say send the 50. She'd call back in three weeks and say we're another 50 short. I gotta call the bank and borrow the 50. The board never paid one quarter. I was stuck out of my own pocket."
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