Department of Outrage

HCAC Crimes and Misdemeanors,

Let's Round up the Directors

By Edward Shanahan

 The parallels are striking.

 Drowning in a sea of debt, the organizations finally not only are bankrupt, but eventually go out of business, throwing employees out of work, leaving investors with worthless stock or vendors with unpaid invoices, and terminating services for customers or consumers.

 The recent decline and fall of the 40-year old, $11 million public Hampshire Community Action Commission and the catastrophic collapse of the billion dollar stockholder-owned Heritage Bank almost 20 years ago share many similarities.

 Chiefly, in the end no one was held accountable –  the administrators or the board of directors of either organization. They simply walked away from the ruins they presided over without being required to explain how it happened and what their role was. It just made them feel good to be able to serve the public.

  In the case of the looting of the Heritage Bank a single employee, Michael Smith, was made the scapegoat and took the fall with the movers and shakers on the board – many, many doctors, lawyers, educators, corporate CEOs  – simply move on to new civic responsibilities as befits their elite status in the community. As paid directors how could they be at fault?  It had to be their underlings who screwed up.  It certainly couldn’t be them – they were the best and the brightest. Everyone said so, they believed.

  In the case of the HCAC, the pillaging of the agency – an organization whose essential role was to provides services and programs for the struggling poor population – was the result merely of lax administration but, of course, blame did not reach the directors. They simply did not know what was going on. How could they be faulted?

 I mean how could directors like David Scott, former chancellor of UMass-Amherst know what was going on, or Thomas Hanley, director of the Hampshire County Long-Term Care facility in Leeds, or David Kielson of Chesterfield. They probably were too busy to pay attention to something as piddling as the affairs of HCAC.

  For those of you with short memories, HCAC was not a new agency. It was part of the War on Poverty program launched by President Johnson and Congress in the 1960s. Its purpose was to create programs and provide services, using public funds, to lift people out of poverty.

 In the end, the war on poverty locally, after decades of good work, turned out to be a war against the poor with the rewards going to the well-off.  Everyone at the top of the heap saw no evil and spoke no evil. And when the going got tough and the heat was on, 11 members of the board of directors simply split, vanished, and even today decline to be interviewed. Why should they be bothered by pesky questions?

  These reflections are prompted by the first-rate public service stories that were reported and written by Daily Hampshire Gazette reporter Dan Crowley. The recent two-part series of articles depict a public agency nothing less than ransacked and robbed by rogue management, including executive director Alan Sax, absent or remarkably stupid directors and lazy state and federal regulators who were not paying attention or who preferred to look the other way, even though it involved public funds, when confronted with well-documented evidence of wrong-doing and bad behavior.

 Outrage is the only reaction possible in the wake of Crowley’s detailed account of credit card abuse for private gain, the downright theft of funds, such as the $350,000 in unemployment tax money that was squandered, and the pension funds that were stolen from employees, and the bills to vendors that have never been paid. 

 But beyond outrage there needs to be a demand for full accountability and criminal prosecution where crimes were committed.

 These are not trivial matters that can be excused as merely sloppy management, lax procedures, or poor oversight.

 Crowley’s dogged reporting requires a full-scale investigation of any and all individuals who had administrative, supervisory and financial responsibility  for the integrity of HCAC, its revenues, its programs,  its employees and most importantly those who depended on it for services.

 Serving as a director of a board of a public agency, a non-profit organization or a stockholder-owned bank is a solemn fiscal responsibility. It is not just a way to pad a resume or purport to be a community leader by merely going through the motions.

  Where were the District Attorney, the Attorney General, the state Auditor, the FBI, the federal agencies - all of which failed to act responsibly in the aftermath of the HCAC burglary?

 Even though the damage has now been done and the agency is not only in ruins but defunct, there still needs to be an accounting. Who know what, when and why action was not taken?

  Crowley appears so far to be the only one motivated enough to find out what actually went wrong at HCAC. That is why we will always need hard-nosed reporters to ferret out the malefactors. Crowley has done his job and commendably.

 What we need now are the combined law enforcement agencies to complete his work with a thorough investigation of their own to assess formal blame and render punishment.