Top Staffer for $5 Billion Hershey Charity Becomes Whisteblower Against Powerful GOP Boardmembers

[JPZenger]

http://www.philly.com/philly/business/20110210_Ex-top_Hershey_official_alleges_charity_wrongdoings.html

Latest in a series of great articles in the Phil. Inquirer about scandals involving the $5 billion Hershey Trust. It is a charity funded by Milton Hershey and his chocolate company to provide a boarding school for 1,800 needy kids.

The man who until recently was the top staffer for the Hershey Trust Co. has filed papers to the court that overseas the Hershey Trust. This staffer, Mr. Reese, had a distinguished prior career with the Hershey (Chocolate) Company. The Chocolate Company has no role at all in these scandals.

The Hershey Trust has provided high salaries for part-time work to many powerful Republicans, including the $500K a year made by the chair, Leroy Zimmerman. Most other boardmembers made at least $100K a year for part-time work. They also set up Lynn Swann with a comfortable board seat on their HERCO subsidiary right before he announced he was running for governor.

Many millions of charitable funds have been spent to buy and improve a failing luxury golf course, which became an almost personal playground for the boardmembers.

There have been constant demands for an investigation by Corbett, who always refused. Then, after the 6th Phila. Inquirer, he was finally embarrased into saying he would do an investigation. As last reported, he never bothered to actually ask for any documents to start the investigation. Instead, he held a high priced fundraiser at the Trust's Hotel Hershey.

[JPZenger]

1. Charity's Subsidiary Paid 15K to PA GOP + Free Place for Fundraiser

Much more at:

http://www.miltonhersheyforums.org/forums/showthread.php?t=1638

Among other allegations is that the charity's subsidiary paid $15K to the PA. Republican Party, plus provided Mr. Hershey's home for free for a fundraiser with Karl Rove.

The allegations include that the charity's hotel/amusement park/golf subsidiary never makes a profit, because it is forced to spend so much money to provide free services and facilities for the charity's boardmembers.

The allegations also say that the charity pays $100K a year to a Republican lobbying firm, even though there is little evidence of that firm doing actual work.

[JPZenger]

2. Another Phila Inquirer Article About the Misuse of Tens of Millions

http://www.philly.com/philly/news/homepage/20110211_Ousted_Hershey_Trust_president_tells_court_of_serious_financial_irregularities.html?viewAll=y


The link above includes a photo of Trust Chairman and GOP powerbroker Zimmerman standing under a banner that says "Zimm's Palace", after he forced the Trust-owned Hotel Hershey to make millions of improvements that he enjoyed, and which the company felt did not make financial sense.

Excerpts of today's article:

"The just-dismissed top executive of the multibillion-dollar Hershey charity for poor children describes in a court filing widespread financial irregularities at the philanthropy, including the use of charitable assets for free rounds of golf, spa treatments, limousine rides, and excessive compensation for board members.

Board members earned six-figure annual compensation for working an average of five hours per week. They enjoyed free stays at the lavishly redesigned Hotel Hershey and free rounds of golf at the nearby Wren Dale Golf Club they bought with money meant to support and grow the Hershey School.

Reese seeks to have Hershey trustees reimburse the charity $22 million for purchasing the Wren Dale course at an inflated price and improperly commingling funds in Hershey Trust that led to remedial action after the trust company alerted the SEC. The court action is the latest development to confront the Hershey charity, which has $7.3 billion in assets and operates the largest free and private school for disadvantaged children."

P.S. - these trust boardmembers also managed to operate the Hersheypark amusement park, the Giant Arena (which was paid for by State taxpayers courtesy of Tom Ridge), the Hotel Hershey and the Hershey Lodge in a way that hasn't generated any income to the charity in years. Finally, under pressure, they had the company take a loan so they could say the hotel/entertainment company made one $2 million token payment back to the charity from the subsidiary.