*ATA Announces Mismanagement by Former CEO; Pledges Better OversightNASHVILLE--Mismanagement by the American TeleServices Association's short-lived president/CEO is sparking a legal investigation, a new system of internal oversight and leading the association to embark on a capital fundraising campaign, the ATA's new board president Steven R. Brubaker told membership at the association's convention here yesterday.
While the amount of mismanagement was not part of the formal presentation to members, the former official, J. Scott Thornton allegedly mismanaged $310,000, according the Donna Bryce, communications director of the ATA's board for 2000. Thornton's appointment was announced at the ATA's 1998 convention and he was touted as the businessman who would help bring the association to a new level of growth and prominence. Membership declined slightly from 2,223 to 2,069 since last year.
The transgressions were uncovered in July, and spurred Thornton's immediate dismissal. Although Thornton was not authorized to enter into contracts of more than $10,000, officials believe a bank holding ATA accounts mistakenly allowed Thornton to authorize larger payments, said Bryce. Among mismanagement, it is believed that Thornton used ATA funds to hire his wife and to enter into contracts of more than $10,000 for a conference he was planning.
"He took actions that went against board policy and specific board initiatives," Brubaker told the crowd during the ATA business meeting, immediately following a luncheon awards presentation. Brubaker asked for a "vote of confidence for our 2000 board to continue."
Questions from the audience following Brubaker's speech focused on issues such as whether there would be more local ATA events, leading some to privately question whether the presentation effectively communicated the full implications of the financial problem.
The association is conducting an investigation and plans to hire an attorney, according to Bryce. With the advice of corporate counsel, Bryce has been gathering evidence, and the selection of an attorney is expected to be made in the next week or two, she said.
To prevent the situation from recurring, the ATA has established a financial advisory council, made up of past ATA treasurers, and a management advisory council, made up of past presidents. In addition, an annual independent audit of the association's finances will be undertaken.
Telewatch, a project still under development which is designed to address teleservices ethical standards and practices will be folded into the ATA, the association announced. The program's separate staff and board of directors have been disbanded.
Though officials would not attribute the consolidation directly to the association's financial situation, they acknowledged the financial problems had been a factor in the decision.
"We felt that having two separate boards, with the financial situation being what it was, did not make sense," said John Miklosovic, the director of ethics/standards and Telewatch for the ATA's board for 2000.
When the Telewatch project is completed in March, it will provide an avenue for companies to apply for certification that they are in compliance with ethical standards. For ATA members, applications for certification will be free, while non-members will have to pay a non-member application fee.
To make up the shortfall from the alleged mismanagement, the board also anounced the launch of Capital Campaign 2000. Every member of the board for 2000 has pledged $5000 toward the fundraising effort.
"We will give members the opportunity to help take the association forward through sponsorship opportunities," said Brubaker. The fundraising effort will involve contacting members on an individual basis. No specific financial goals have be set, he said.