A poverty pimping organization corrupt and bankrupt? How very surprising!

I'm impressed with the reporting that has gone into this. Sounds like a double set of books. What a wise choice the board made in switching auditors. Good job, Pleasanton Weekly!!!!

Now the Board of the Pleasanton Unified School District needs to request a deep forensic audit with a different auditor to find out where all the Measure B money, developer fees and pass through money went.

CROOKS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

With all due respect, there is no way a competent Board would not have seen the signs of this several years ago had they known what to look for and paid better attention. I recognize that most non-profit boards serve as volunteers. However, if they applied some of the same business acumen to their volunteer work as they do their profession, these types of problems would be nipped in the bud.

I would certainly caution against any overly hasty rush to judgment. After all, the Foundation has been run by respectable private sector businessmen and, of course, given the Obama economy, it is impossible to overestimate all the good things that occurred during the Bush Administration. Bubbles occur. Savings and Loan (ask my brother about that!), housing, credit cards, and now student bubbles. At no point should these be blamed on our good private sector businessmen who, like my friends at Bain and I, are always after a good profit. Maybe a rule or two was bent, maybe a lie or two was told, but for heavens sake, that's what good capitalists do. (I'd elaborate further on this, but for criminy sakes, I'm running for president and so couldn't possibly be expected to be forthcoming about this, after all!)

I comment Judge Ron Hyde for taking on such a difficult fast of closing down the TVCF.

Judge Hyde, THANK YOU for all your years of service and community leadership. I for one, am confident that Judge Hyde will do his best to work with all those affected.

Did anyone actually read the article before commenting on it?

I trust TVCF has sent details of its concerns about David Rice's actions to the board of the Texan non-profit that is apparently now employing him.

This is really tragic in the sense that non-profits have been coming under increased scrutiny for many years; this will only hurt those charitable organizations that have the best of intentions and play by the rules.

Based on the comments from this article, insurance aside, what the heck has the Board of Directors been doing since 2006-07? Have these people been paid for their position on the board, or for attending meetings? Have they received free dinners or free inclusion in charity golf tournaments? If they've received one red cent, or one single free meal, they should pay it back with interest. Maybe that would save at least one of the charitable organizations they've taken down with them.

It shouldn't be lost anyone that some of these donors had specified where their dollars were to be placed. That didn't happen and that is criminal. I can't imagine it is easy to run a small non-profit into the ground taking other non-profits with you. Where was the oversight? Why was the charity committing dollars they didn't have?

Too many unanswered questions at this point. But there is nothing more disgusting, IMO, than asking for charitable donations and then misappropriating the funds. I only hope this doesn’t lead to a reduction in donations for those charities that truly deserve our support.

Three million in debt is almost three times there revenue (donors contributions). I don't think it is just future defendant Rice that has some explaining to do!

As a past Board member of TVCF I can tell you that we received absolutely nothing for the time we put in. Not one red cent and certainly no freebies of any kind. When Mr. Rice had no one but the Board to answer to and had a free hand at selecting and also eliminating the Board members and officers [portion removed] .. many of us tried time and time again. When someone got too close to what was going on .. he would ask them to leave the board. He withheld and hid the financial information to the point that many resigned in complete frustration over dealing with him. I am thankful that Ron Hyde finally had the information and ability to stop what was going on. But that probably only came about because the money was gone. It is a very sad situation.

As we know, this happens all the time. Some years ago when my daughter was in YMCA's Indian Princesses, I heard tale of there hastily removed director was let go for embezzlement. No prosecution or heads up to his next employer. Why? They didn't want bad publicity when they are always going to the community asking for donations. Personally, I only give to soup kitchens. At least you can see people being fed there. F course doesn't guarantee someone didn't skim a bunch off the top.

I do sympathize with what the Previous Board Member posted and it does ring true throughout Pleasanton.

Unfortunately in Pleasanton in many cases whenever Board members who are volunteers and even elected by the Public start to ask hard and probing questions about financials and other potentially illegal and unethical activity, they are systematically bullied directly and indirectly, stonewalled, and information is withheld by the chief administrator and those that work under the chief administrator.

Some chief administrators impose gag orders on Board members not allowing them to ask any questions (talk about violating Freedom of Speech). The 'orchestrated litany of lies' of these people need to stop.

Hyde did the right thing by bringing it to law enforcement's attention for criminal prosecution. This wheeling and dealing and fraud rampant within Pleasanton has to stop.

Good thing that this also happened when in the summer 2009 the PUSD administrators rented office space to Tri-Valley University without telling anyone. Because it is zoned P for Public, should have gone through a "Conditional Use Permit" as a private college. Instead it was snuck in without anyone in the city being notified. It is good that the whistle was blown and Federal law enforcement was brought in.

It seems premature, and a rush to judgment, to accuse someone of committing a crime in one sentence when another sentence says: "I cannot find any evidence that he took any money for himself."

Also, is this really "breaking news" as the email to subscribers said?

It sounds like there is something more going on here.

Wow, your statement:

"Unfortunately in Pleasanton in many cases whenever Board members who are volunteers and even elected by the Public start to ask hard and probing questions about financials and other potentially illegal and unethical activity, they are systematically bullied directly and indirectly, stonewalled, and information is withheld by the chief administrator and those that work under the chief administrator."

What do you mean by in many cases? Are you saying accountability is a big issue in the tri-Valley? Aside from claiming these practices need to stop, I'm curious - just where does the buck stop?

The damage done goes beyond the 3 million dollars and the 25 other non-profits that may or may not be impacted by this travesty. It really cuts to the core of trust, integrity, and accountability.

It doesn't seem like anyone in this state is accountable for anything anymore. Blame the guy that is now supposedly sucking charitable donations from suckers in Texas, while nobody around here wants to take responsibility for anything.

"When Mr. Rice had no one but the Board to answer to and had a free hand at selecting and also eliminating the Board members and officers and bald faced lied to us on a regular basis it was impossible to bring this to a head .. many of us tried time and time again. When someone got too close to what was going on .. he would ask them to leave the board. He withheld and hid the financial information to the point that many resigned in complete frustration over dealing with him."

To: Previous Board Member

You say it,"When Mr. Rice had no one but the Board to answer to..." That was you. While I appreciate your honesty a board members duty includes direction, oversight for the organization, and performance evaluations of the CEO - including hiring and firing. I'm not sure when you became involved but for board members to deflect from their own responsibility is disengenous.

Why didn't you and others sound the alarm. This wasn't a one time incident. It appears this was a clear and reckless pattern of behavior that went on for many years; with a predictable outcome. We aren't talking about 25K that can't be accounted for. We are talking about millions of dollars that were promised to other organizations. This is hurtful for many organizations and many people.

Previous Board Member stated that every time someone started asking hard questions, the Board Member was eliminated.

Many times, situations happen where when Board members start asking questions about theft of funds, etc. like in this example, news stories in the press indicate that they are threatened. In this case recently, it was a school superintendent who allegedly threatened a board member over reporting theft to law enforcement.

Web Link

Many State laws out there govern boards like Davis-Stirling where if someone tries to interfere with a board member doing their due diligence duties, there are ramifications. And then there are laws like Penal Code 69, 71, and 76.

Sometimes when chief administrators have too much power, they also try to couch everything as 'confidential' so that Board members are silenced through fear. Maybe several years ago, people concerned about misappropriation of funds should have reported it to law enforcement.

A good lesson is that the power of chief adminstrators should be strictly limited rather than given unlimited powers. The Boards should be in control of the administrator, rather than the administrator being in control or the Board. And when administrators start chatting about potential issues being confidential, this is a good sign that Board members should weight the pros and cons and they should really consider picking up the phone and calling for forensic audits and law enforcement.

So true, Wow. It's dangerous to let the paid chief administrator be a voting board member. Bad governance.

It's simply a shame that nobody tried to prevent this unfortunate chain of events. Perhaps the outcome could have been different if the Board had been warned years ago by a disillusioned donor; or if TVCF's original auditors had been warned years ago by a whistleblower report; or if the Pleasanton Weekly had been urged years ago to dig a bit deeper before unconditionally endorsing TVCF in their newspaper. Perhaps some of the $3M loss could have been avoided, and perhaps the blow to local philanthropy would not have been so severe.

I'm reminded of a few lessons from recent years. The first is to always insist on transparency and accountability. The second is from Ronald Regan: "Trust but verify."

Web Link

http://74.6.117.48/search/srpcache?ei=UTF-8&p=olentangy+Adam+White+superintendent+threat&xa=QlbiZUS9wFtDboJLcO9_ww--%2C1339571296&fr=yfp-t-701&u=Web Link

...are two important web links.

These two news stories show how important it is for Board members to go to law enforcement when there is evidence that funds are mishandled, or any other evidence of wrongdoing , rather than adopting the "circle the wagons mentality" so common in public entities that allow Closed sessions and in Not-For-Profits.

In this instance, an audit shows that athletic directors at two of the district’s high schools used money to open bank accounts using their personal information and then wrote thousands of dollars worth of checks that no one approved.

The Board member contacted law enforcement, as he should have done when the State audit identified the issue. The Superintendent then allegedly threatened the Board member in an Executive Session after the Board member reported it to law enforcement.

It serves noone if people who commit crimes are then protected by administrators, in a cloak of confidentiality, then people go on to other positions somewhere else under a shroud of secrecy.

The Board member in this instance did the right thing. I'm glad that TVCF eventually came around to doing the right thing.

This practice may have occurred before 2006. I contacted/wrote into the Government over this man way back, however, never heard a thing and David Rice continued on with this organization. Perhaps they felt my concerns were unwarranted or that this did not fall under a specific jurisdiction (I would hope our government would send concerns to the appropriate authorities). I was w/a small non-profit and Rice promised us $1,500.00. I had to get two prominent community members to HOUND Rice for that money! [Portion removed] Others told me of similar stories, but, said they (the other small non-profits) would often give-up on collecting the promised funds. I was determined and called almost every day. With the help of two well-known community leaders I was able to get he dollars promised our little non-profit. Soon after I met a woman who was a bookkeeper or accountant for him and had quit-she just roller her eyes when his named was mentioned. No-I have not been fooled by him since that time and I have stated so to anyone who spoke of him. People have talked about him for many years-the information has been there. Yet, so many people would say "he means well" or " he is just David." I think they were conned and swindled and completely oblivious to his TRUE self. I could talk until I was blue in my face...people are SO easy to con. I think if they dig deeper they will find he took money. However, please do not hurt these small non-profits. They need help from our community now more than ever. Young children, veterans, families, seniors, faith establishments and animal charities need our support. Remember this and don't let a sweet-talking person like that run any of our non-profits again in our community. If you have a non-profit demand a full accounting from your treasurer. If donations are made and a request is also made that they go to a specific cause, scholarship or need then HONOR that request. We are supposed to be a Community of Character and make sure the people handling funds in your non-profit are above suspicion. That they always count dollars with AT LEAST one other person and that there is a full accounting of money. Many of us were suspicious of David Rice, but, it fell on deaf ears. Community people have been complaining about Rice for years and I find it hard to believe that he was able to remain in that position for as long as he did. Make sure you give to charities with better checks and balances ...and meet the people...go with your gut/intuition...don't fall for the "flashy" talk...or a bunch of "hot air." there are some great non-profits in this area and they deserve our support-thanks.

Having served as a board member for a non-profit, I know how important it is to have numerous checks and balances for the non-profit's books. As John noted, it is bad governance to have the Executive Director be a voting member of the board. It sounds as if that is what happened at TVCF, when Rice should not have had as much power as he had. That said, when you have a short-term, rotating board and a long-term ED, the governance has to be carefully crafted to avoid having the ED holding the power. New board members are at a disadvantage to the workings of the organization.

Independent bookkeepers, accountants and auditors help keep the books open to the board. Having an audit committee and more board oversight help keep an ED from acting independently. A grants committee helps direct where funds are going. Board member training and support should be paramount for anyone interested in serving in an organization. Help is out there, especially in our SF Bay area.

PW Reader, I completely agree. Having an independent audit committee is key to public sector, education and non-profit accounting, but is key that the make up of these committees are people independent of the entity they are auditing who are not easily intimidated and silenced.
It is also important that Boards and citizens are empowered to speak up, and don't fall for the pile of dirty tricks so common to intimidate citizens and Board members who ask hard questions.

For example, in this instance here Web Link , a chief administrator/superintendent of a school district threatened citizens and their families who were questioning the District's fiscal practices and it was caught on tape. If you click on the link, you will see that the superintendent threatened to have his staff send a truant officer after one of the children of one of the public speakers who had spoken out against a salary raise he recently received. Charming, yes?

He also said several other colorful things such as “You can take the Democrat party and [you can guess the end].”

Boards need to make sure no one is King or Queen of the Board because they are equally accountable and make sure their chief administrator is not part of the Board and reports to the Board.

To: never trusted

I love your comments and I too don't want this tragedy to denigrate the charitable work that good people are doing for the community. The worst case scenario is that people lose faith in their ability to expect charitable donations to actually benefit the causes they support, which will inevitably lead to fewer donations as we head into a very difficult period when our safety net dollars are being diverted to pay for basic services.

I do think it's important to understand exactly what happened to ensure it does NOT happen again. While it sounds like David Rice failed in his responsibility to both the donors and recipients of funds, I don't think you can limit the responsibility to just one person. The Board had to see this coming years ago. Why didn't they sound the alarm?

The Board/oversight committee failed to see what appears to have been obvious for several years. It makes me question whether or not the Board members had the financial expertise to evaluate financial reports. What about the book keeper? Charitable organizations have reporting requirements. Was anyone paying attention or was this just a feel good endeavor for all involved.

Placing all the blame on just one individual is just wrong. This was an organizational failure.

There are three companies that David Rice was the head of. There is Tri-Valley Community Foundation, Tri-Valley Community Services and Youth Achievement Program LLC according to this Web Link

Maybe the Pleasanton Weekly could do some digging about these two other companies. Are they 501c3s? Did the money go to these two companies?

This is unfortunate but it is small potatoes compared to the $9.3 million that Pleasanton School District stole from taxpayers. There was no prosecution or apology from PUSD and the money has never been accounted for.
Web Link
"The cash-out refinancing -- which was ruled illegal in 2009 by then-Attorney General and now Governor Jerry Brown -- will cost nearly $9.3 million over 20 years, according to the analysis. Of that, almost $2.5 million is in interest, while nearly $6.8 million was spend on projects, although the district has not released a list of where that money was spent."

I am not a lawyer, but it seems to me that there may be enough said here for a libel suit.

It doesn't take much to understand where the $3M really went.  The first piece is the grantmoney paid by David Rice using funds earmarked for other destinations.  It was [portion removed] to claim these funds as available unrestricted Foundation assets.  And I suspect included in that count is their $50,000 per year "match" to the Holiday Fund since it is doubtful any anonymous TVCF donor provided those funds.  The other piece was the hundreds of thousands paid annually to staff and consultants whose only talents were blowing smoke and positioning mirrors.  The real mission of TVCF for the last decade has been to provide full employment to a team of inept nonprofit administrators.  What a waste.

But the real shame is the opportunity missed over the last 20+ years to build a real base for our community.  The Tri-Valley Community Fund was started in the 1980s by dedicated community leaders (one being Tim Hunt, who broke contact with TVCF many years ago).  Think of where we all might be if an effective community foundation could have leveraged the growth and prosperity that our region has seen over all this time.  With that in mind, the real loss count needs to include a $50M endowment that never came to be.

How unfortunate that a community group set up to do such good, could end like this. I hope that the smaller charities that were supported by this foundation will survive.

This fraud could not have happened if the CPA (tax preparer), auditor, and treasurer were doing their jobs. Just looking at the early tax returns from 2005/2006 and the latest returns filed, should have been enough to raise red flags.

Whenever a charitable organization, or any non-profit, handles large sums of money, the board should be made up of individuals who have had professional training in fiscal responsibility. Being a respected "citizen of the community" is not a good enough qualification. Could anyone on this board even read a balance sheet?

Agree with Arnold - this was an organizational failure.

Even IF tax returns were checked...WHO and WHY did this TRI-VALLEY charity send money all kinds of out of area people and groups ?
Right now at the TOP of this article, you can click go to ""MESSAGE BOARD"" and read all the initial FULL ARTICLE posting and much more IN DEPTH article with additional information, plus all the initial questions and comments. That thread is titled "" Where's the money gone ? """. That whole thread should be connected to this thread.
Check MESSAGE BOARD . . . also AROUND TOWN is less to wade through

DATE of original article posting "" Where's the money gone """ was MAY 31 .... make it faster to find.

Bill, for all positions, whether paid, or voluntary boards, or POLITICIANS at every level, it is ALWAYS better to have people who actually UNDERSTAND MONEY and how it works, UNDERSTAND ECONOMICS, and can not only READ annual reports but also UNDERSTAND them, and the causes and effects of money ! ! ! Sadly, many who alter lives ro choose people who alter lives, do not have that understanding.
It's best to check out that knowledge of money before placing them in positions of trust. Ignorance can be as damaging as false intentions.

Would the posters named Previous Board Member and Never Trusted David Rice please contact me at my office number: 925-600-0840 ext. 121.

Thanks,
Glenn

The 990s listed on Foundation Center have the Board Members from year to year listed so it would not be hard to find out the previous Board members who have departed the Board Web Link

2001/2002 – Richard Karn, Joan Zehnder, Tim Hunt, Thomas O’Malley, Pete Snyder, Midge Callahan, James Phillips Esq, James Lopez, Judith Barnett, Frank Berlogar, Richard Carlson, John Earthy, Rick Griggs, Daniel Hancock, Howard Hyman, Douglas Jamieson, Barbara Mertes, Kit Niemeyer, Nancy Pennell, David Romano, David Rounds, Rebecca Rozen, George Shore, Bill Vaculin, David Rice.

2003/2004/2005 – 990s say see attached list but there is no attached list

2006/2007/2008 – David Rice, George Shore, Mark Curtis, Richard Karn, John Lineweaver, Richard Loupe, Kenneth McCartney, Nancy Pennell, Erin Kvistad, Lee Adair, Kit Niemeyer, Thomas Rose

2009 – David Rice, Richard Karn, Ronald Hyde, Kenneth McCarthney, Don Lewis, Kit Niemeyer, Thomas Rose

2010 – David Rice, Ken McCartney, Ronald Hyde, Michael Santimauro, Don Lewis, Kit Niemeyer, Michele Matsumura JD, Thomas Rose

I have to say for gosh sakes that its absurd to list all these upstanding members of the private sector. It is only government workers who are prone to corruption, after all. Sheesh! Think of all the value-added activities these fine men have contributed? And what has government done?

There is a lesson here. Look at the Obama administration. Waaaay over his head. Then look at my record at Bain. Need I say more? Tri-Vally should be appreciated for what it was. Good businessmen using good business practices to do what the state does all the time. Give money to poor people. I'd rather have private sector donations that let the government handle matters.

Is Alameda County DA 'on the case' ??
Why didn't somebody report it to our county Grand Jury long ago, so they could have been investigating, before tracks were likely covered. Any position of trust can be reported to Grand Jury for them to check out and move forward as needed.

I heard from a reliable source that the matching funds used for the Pleasanton Weekly Holiday Program was part of the funds that were "lifted" from other non-profits without their permission. Makes sense. If they are in debt, meaning they do not have the money in their regular funds, that they had to take the money from other accounts in order to do the match. I wonder why the Weekly "investigation" left this out of the article? So I assume the money that people donated to the Holiday Funds went to the correct place but the matching was taken from other accounts without their permissions.

And how many years has the Weekly been doing this holiday fund with a match from the Tri-Valley Community Foundation? It has been many years so there are probably a couple hundred thousand dollars that were taken from other accounts without their permission (i.e., stolen), to make up the Weekly Holiday Funds over the years. I would like to hear if the Weekly will be returning those matching funds that were improperly obtained.

This is not a surprise, reading the financials of this organization from 2000 to current reads as a mistery of vanishing funds with an increase of liabilities and a sad depletion of its investment dollars.  How could the Board not have a collective meeting on this obvious depletion of Funds without Mr. Rice.  Who was really paying attention?  There is no way to blame only one person, was the Board engaged with this organization? or were they just there warming a seat? Ignorance is not an excuse with the magnitude of what has occurred. 

To many community citizens attempted to bring these issues to the Board.  What happened, the citizens were spoken of as disgruntle neighbors of the community and were discarded as crazy! 

My family has been very active in the community since we moved to Pleasanton when I was 3 years old. My mom is a teacher at Amador. My dad coached little league baseball for over 15 years in Pleasanton.

6 years ago my dad suffered a massive heart attack and died while snowshoeing @ Donor Lake.

It was about 2 weeks before I was set to graduate college. As devastating as it was to my family, we realized how lucky we were to have an amazing father in our lives and that many others are not so lucky.

We created a scholarship to provide graduating high school students who‘ve suffered through the death one or both parents/guardians and had plans to continue their education after high school. Without my dad, I never would have made it through college. I was blessed. In his honor, we were able to raise enough money over the past 6 years to provide over 18 Pleasanton students with scholarship money.

Thanks to this SCUM BAG, David Rice....There is no money for these students. I've met this scoundrel face to face and he really put on the charm. Never in a million years would I think he could be such a piece of excrement. If I ever have the opportunity to meet him again.... I assure you it would be the last. David Rice is the scum of the earth. Stealing from children, stealing from orphans, stealing from anyone. He is SCUM! I hope he gets what is coming to him.

Chris, If the scholarship is reestablished in some way, please let the community know. I would hope former donors would be willing to re-donate.

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