Embezzlement: Airline History Museum Director/Kansas City

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Apparently a "terse" writer
Staff member
Former Airline History Museum director charged with stealing
By DAVE HELLING

The Kansas City Star


Mike Ransdell

The former executive director of the Airline History Museum in Kansas City has been charged with felony stealing in connection with his work for the facility.

Paul D. Sloan of Belton is accused in Cass County of stealing from the museum in 2007 and 2008, according to the complaint and a probable cause statement filed in the case.

The statement alleges Sloan wrote checks, made withdrawals or asked for payments totaling more than $51,000 from bank accounts connected with the museum, which is located at the Charles B. Wheeler Downtown Airport. The various withdrawals were made between October 2007 and August 2008, according to the statement, and most of the money was paid to a company Sloan owned called PDS.

At the time, several members of the board told investigators, Sloan was authorized to raise money for the nonprofit museum but was to have worked without compensation.

Sloan could not be reached for comment. He resigned as the museum’s executive director in May 2009 and a member of the museum’s board approached investigators less than a month later.

The museum grew out of a volunteer effort in the late 1980s to restore a vintage Constellation aircraft. The “Connie” and several other aircraft are on display in a hangar at the airport.

Sloan is due in court Nov. 15.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

I know all about this. In fact, it was an email I sent back in the fall of 2007 to the entire membership of the organization that began a lot of the questions - it was a rather pointed and blunt email. I was invited to not come to any more meetings at the museum ever again (even though I had paid three hundred dollars for a three year membership). I hope they roast this guy - he was certainly a shell-game organizer.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

So anyway, this thread had me strolling down memory lane. It is kind of a disgusting situation.

In late December 2007 there was an email sent to all the members of the AHM bemoaning our money woes (in conjunction with getting the Connie flying, etc). There has always been an undercurrent of "suck" in this museum which is one of the reasons my Grandpa declined getting involved when it was started. I joined because it was something fun for Maggie and I to do.

Anyway, in response to the email I "replied to all" and said basically "Hey...John Travolta jjust came to town and did a fundraiser for us. Where's the cash? How is it accounted for?". I got a couple of replies from some people saying "right on, where's the money?" and a REALLY hateful response from Paul Sloan, the guy mentioned in the article Doug posted.

So, a couple of us "dissenters" got together for lunch - but mostly it was a guy named Bill Doty and I that lead the initial charge - along with a former Captain. We were getting nowhere and there were "cliques" within the museum. Board meeetings were all deemed "private" and it was like the membership was given the mushroom treatment. Given that, we sent the following open-letter to the entire membership of the AHM:

An Open Letter to the Airline History Museum Membership:

In light of previous letters and because, we have questions beyond the document entitled Airline History Museum Fundraising Statements of Revenue and Expenses pertaining to the October 6, 2007 Return to First Class (aka the Travolta Gala) – I, (Bill Doty, a member of AHM since last July) and, another recent member, Jim Alsup are writing this Open Letter to the Airline History Museum Membership. Please take the time to read all of this.

Jim Alsup and I are writing because we happen to have strong backgrounds in this kind of fundraising/special event staging. We both joined AHM well before October 6, 2007 (the date of the Travolta gala); we both offered to help on this Event though our offers were not accepted.

An annual benefit that Jim oversees has a gross take of approximately $300, 000.00 but differs in that expenditures are not permitted to exceed $100,000.00, rendering a profit of over $200,000.00.

The “profit” listed on the audit document was slightly over one-fourth that amount (indicating huge expenditures) - and, of that profit, $36,000 was immediately spent by the Board of Directors on (in our opinion, promotional) books to teachers when, in fact, there is a Museum to be supported, hangar rent to be paid, airliners to be restored, and certificates to be obtained – in a word, our survival.

Additionally, the paperwork for Jim’s annual event yields an accounting of approximate gross receipts within 24 hours of the occasion – to be finalized within a couple of weeks – not five months later and in a new calendar year. Those who attended RTFC must be particularly interested in what Educational Non-Profit Federal Tax Identification number is legitimate to write off their donation(s). It is our understanding that the monies were realized by The Committee though the Museum’s charge machines were used to collect.

This then is to request that the new Board of Directors instruct The (member and non-member) Committee who planned and executed the Return to First Class event, to answer the following questions immediately, in writing with full written backup – receipts and substantiation.

1. What entity charged and received monies for this Gala?
2. Is this entity a 501©(3) non-profit, making contributions tax deductible? Does this entity have a legitimate Federal Tax ID number that we can use before the April 15, 2008 Federal Tax filing deadline?
3. How and where were funds deposited for the last five months? How were they invested and at what rate of return?
4. Has any Return to First Class Committee member, (in or outside the Museum’s membership) been paid or otherwise received any amount of money (other than a reimbursement with receipt) directly or indirectly from funds realized or used in the production of this Event?
5. Which services for the Event were solicited by or offered to The Committee in kind (in exchange), or for free?
6. When will all of the RTFC Committee’s written and electronic documentation of the planning and execution of this Event, including but not limited to receipts, cancelled checks, memoranda, directives, and legal advice be made available to those in the membership wishing to see them?
7. Do the books for this event balance exactly? Which monies were realized (deposited) to the Museum within taxable year 2007? Which arrived in 2008?
8. Exactly who authorized the audit, who did the audit, who accepted the results of the audit, and when will the complete audit be open to the membership.
9. What research and authentication exactly was done, before the monies were expended, to learn about the books costing the membership $36,000.00. Who is the publisher of this book; is it National Education Association (NEA) recommended?

We also request that the new Board of Directors immediately discontinue its practice of holding portions of their meetings "in executive session" so that members taking the time and effort to attend will no longer be asked to leave. We ask that the Board of Directors publish email addresses and be prepared to answer questions of the membership at any time during their terms of office.

If you have questions please direct them to AHM President Bill Skaggs (if you have no address, we will be happy to document their receipt and deliver them unopened - please use the return address on the envelope).

Two concerned and dedicated AHM members,
Jim Alsup and Bill Doty

This created a crap-storm of sorts. We were no longer welcome at the museum (even though I was only 8 months into my $300 three-year membership). We continued to ask questions and we finally recieved the audit we had been waiting for:

2008-03-01TravolartaGalaFinancialReport.jpg


That's right kids - this is what passed for an "audit". Also, at the Board meeting that produced this "audit" they announced that Paul Sloan had been named Executive Director of the AHM. He had been a volunteer and was the one in charge of the Travolta Gala. As the head of the Gala, he made the decisions about expenditures, etc. (Look at the expenses - much inflated over what it should have been, and Travolta WAIVED his fee - came to KC just to help the museum). It wouldn't surprise me if many of those expenses went to Paul Sloan somehow. Anyway - look on the ledger at what the "net" was to that point - and compare it to what the article states the "theft" was. Actually it is more money than that ("expenses" paid from the gala, etc). Anyway - Bill and I sent all of the information we had to the Missouri Attorney Generals office in April of 2008 and that's the last we heard of anything.

Sorry for the "book" - just really sucks about the museum. They'd have the Connie flying again with competent leadership.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

What a crook. I hope he gets the book thrown at him. :mad:
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

What a crook. I hope he gets the book thrown at him. :mad:

It was an incredibly bad deal. The Connie hasn't flown in YEARS and then Travolta came to town FOR FREE to be the draw to an event that raised $350k - which would have put the Connie back in the air AND given a years operating costs to the museum after the costs. As the letter says, I put one on every year that the gross is about $300k. We have to rent a facility (Starlight Theater - 9,000 seat ampitheater) - the AHM had it in the hanger - no cost. We have to hire nationally known performers ($12,000 - $30,000) - Travolta came to the museum FOR FREE. We provide an open bar and sit down dinner catered by the Hyatt for 400 or so people - the museum provided food stations and a cash bar. Our costs are generally $80k-$100k leaving $150,000 to $250k as profit (depending upon our gross - lowest gross we've done is $250k, highest is $350k. There is NO WAY that the museum only had $53,000 after this event - unless there was stealing involved.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

Isn't 14.9% an exceptionally low return for a fund-raising effort? Your letter mentions a $100k cap for an campaign that received $300k, so the minimum there would be 66.7%(?).

Edit: Nevermind, that low number on the page is the whole point.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

Sorry to hear about this Jim, but it seems like he is getting his just reward for being a crook. Sounds similar to the situation at Hutchinson, where the director of the Comosphere (still a world class operation)got pinched selling space artifacts. ugggh

Sounds like you tried to make a difference... What is with that area? What really needs some help is the lousy museum at McConnell, that is an embarrassment to the "Air Capitol of the World".
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

Dang, this is crazy. I've seen the Connie fly once and hope to see it fly again. I wonder how the DC-3 is coming along. I know they put a lot of effort in to getting the L1011 to MKC, but from the outside it sort of looked like they had just neglected everything else.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

Sorry to hear about this Jim, but it seems like he is getting his just reward for being a crook. Sounds similar to the situation at Hutchinson, where the director of the Comosphere (still a world class operation)got pinched selling space artifacts. ugggh

Sounds like you tried to make a difference... What is with that area? What really needs some help is the lousy museum at McConnell, that is an embarrassment to the "Air Capitol of the World".

It isn't just aviation museums, or even this area - many non-profits are easy targets for con-artists. I'm involved in some REALLY GOOD non-profits (hospitals) and they do a nice job of accountability for the community. It was the shock of knowing how we do it there that led me to raise the fuss here. Non-profits are full of volunteers and Board members that care about the mission - and all the warm/fuzzy feelings that go along with it. That is why con-artists can have good luck with the non-profits as a target. What many involved in a non-profit forget is that it HAS to be run as dilligently as a business and with complete transparency. As a Board member of any non-profit you are financially and/or criminally liable for anything that happens to the organization. I was not a member of the Board of the AHM but any of you that DO get involved in non-profit Boards (and you should - it is a wonderful thing to do) - just be careful and treat the organization and its finances as you would your own business.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

They spent more money on flowers than on food for an event? :laff: How did this guy think he was going to get away with their money?
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

They spent more money on flowers than on food for an event? :laff: How did this guy think he was going to get away with their money?

He did for a long time. The event was in October of 2007 and the letter we wrote was in February of 2008. We finally turned over everything we had to the Missouri AG in April of 2008 and it's just now being dealt with - but only after the guy resigned.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

Oh - and one important point. John Travolta was the guest of honor. He was shooting a movie at the time. He normally charges an appearance fee of upwards of $150,000. He said, if you can get me to KC, and BACK to the movie set by the next day I'll do it to help. So, Garmin flew the jet to go get him, delivered him to the hanger, and flew him back and Travolta did it for free. So, if nothing else, Travolta's a good guy and I certainly don't wish to imply that he knew anything at all about this in any way. He was doing what anyone who loved these machines would do and should be applauded in my opinion.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

I'm no accountant; what level of rigor/detail is standard for a published audit like that?

Also, is there any difference between a public company buying a nice luxury sedan to make available for the CEO's use, and the same thing happening at a charity?
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

I'm no accountant; what level of rigor/detail is standard for a published audit like that?

Also, is there any difference between a public company buying a nice luxury sedan to make available for the CEO's use, and the same thing happening at a charity?

That was the only sheet of paper provided - and was simply an income statement through 10-2007. An audit is much more rigorous, shows where exactly the money went, has been verified by a CPA and then certified by a CPA (which is why they call the Certified Public Accountants - they can sign something and that is supposed to mean "I have verified this and it is all accurate and accounted for").

As for the car - a non-profit can provide a car just as a for-profit can.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

This all smacks of hankey-panky.

Look at the expenses for 'event planning' and 'consulting'. Really? Weren't the planners and board members all unpaid volunteers?

Without receipts to actual firms, businesses, or individuals, it's like this guy just made up numbers to account for the money he took from the register then split town. Given the non-profit status of the museum there have got to be governing regulations in place. Something.

Can the Attorney General freeze his assets pending investigation or do they need some greater evidence of wrongdoing first?

This seriously annoys me. Both at the alleged perpetrator and the board members. Perhaps we're not all as prone to scrutinize others we believe to share a common interest, but surely with that amount of money changing hands somebody would have thought to safeguard the process by instituting a budget oversight committee.

*sigh* Such is the way of the world. As long as there are people with good and honest intentions there will those who will exploit them. I suppose given that we should all learn to keep a most skeptical eye towards such processes aiming to enrich society and the greater good.

That said, accountability must be had for those who have done wrong here.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

Yea I was a member for 1 year and attended meetings but as Waco said it was very clicky.
 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

Just found this. Unbelievable!

The former executive director of the Airline History Museum in Kansas City pleaded guilty Monday to one count of stealing.

Paul D. Sloan of Belton was sentenced to five years supervised probation. In addition, he cannot handle money or fundraising for any not-for-profit groups during that period and must pay $10,000 in restitution in $200 monthly installments.

Sloan was accused of stealing from the museum in 2007 and 2008, according to the complaint and a probable cause statement filed by Cass County Prosecutor Teresa Hensley. Sloan wrote checks, made withdrawals or asked for payments totaling more than $51,000 from bank accounts connected with the museum, located at the Charles B. Wheeler Downtown Airport.

 
Re: Embezzlement: Airline History Museum Director/Kansas Ci

So tell me about the Floral and Equipment Rental expenses?

Joe
 
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