The state of the US Chess Federation under Goichberg / Berry
Under the leadership of USCF President Bill Goichberg, Vice President Jim Berry, VP of Finance Randy Bauer and Executive Director Bill Hall, the USCF lost approximately 1,500 members (according to Mike Nolan) in the past 12 months and $419,968 (according to USCF Chief Financial Officer Joe Nanna) in the first 7 months of this fiscal year.
Labels: Bill Goichberg, Bill Hall, Financial Crisis, Jim Berry, Randy Bauer, USCF
posted by Chess Daily News @ 2/02/2009 04:29:00 PM
6 Comments:
At Tuesday, February 03, 2009 11:47:00 AM,
Anonymous said…
Here are the things that are known about candidate Lafferty:
1. He's a new member to the USCF and he has a lower chess rating than many 6 year old kids. His chess resume in any capacity is extremely thin.
2. He made multiple legal threats to board members, FOC members, MOC members, USCF members, etc.
3. He made thousands of posts on different forums to insult the ED, various board members, and USCF members.
4. He said: "You better consult your attorney. I don't care if this federation (USCF) goes under."
5. He said: "At this point, IMMHO, bankruptcy would be the best medicine this organization (USCF) could ever be given."
But USCF members don't know what are his plans to improve the federation other than "Candidate Brian Lafferty wants to involve the USCF in another lawsuit options" according chess journalist Sam Sloan. We don't even know who he is.
What do we really know about this candidate? Is he willing to provide the names, telephone numbers or addresses of his current and past employers so we can verify who he is?
At Monday, March 02, 2009 5:59:00 PM,
Anonymous said…
While I agree with BocaJunior's main message, I'd discourage everyone from using someone's chess rating as an indicator of their administrative abilities. Phil Jackson can't touch the rim - does that make him a bad basketball coach?
At Monday, March 30, 2009 3:43:00 AM,
sassy said…
haha, poor example dan. Phil Jackson can DEFINITELY touch the rim. He played professionally for years as a 6'8 guard/forward. He would barely have to jump to get the rim :). Anyway, I agree with BocaJunior. Good administrators don't have shady histories.
At Monday, March 30, 2009 11:35:00 PM,
Kedy said…
USCF vs. Polgar
San Francisco, California
March 12, 2009
3:00 p.m.
The full transcript can be obtained via the Official Reporter.
THE COURT: With any luck somebody will get sanctioned at the end of this, so let's figure it out who that is.
THE COURT: So who served a subpoena on you in the Texas litigation which you are, I guess, a defendant?
MR. LEIGH: His attorney, but it's also the attorney for the U.S.C.F.
MR. KRONENBERGER (USCF attorney): He represents both the Federation he represents pretty much all the defendants there in Texas.
THE COURT: And he issued a subpoena to you for what?
MR. KRONENBERGER: All the subpoenas that I served in the California case and all the results from those subpoenas.
THE COURT: Well, that sounds a little bit collusive.
THE COURT: Let's not play games, okay? I mean, your own attorney is serving a subpoena on you in the Texas litigation for documents here...
THE COURT: Well, you are serving subpoenas on yourself for all intents and purposes...
THE COURT: Okay. I don't want any subpoenas issued in this case by anyone...
THE COURT: I will make it easy for you. No discovery is to be done in this case until we have had the motion to dismiss or transfer. Period.
THE COURT: And with respect to anything related to the Texas case, you have got a Texas Court. You are going to have to go back there and get your relief from the Texas Court. Maybe this whole thing will end up in Texas, who knows?
MR. KRONENBERGER: So we will -- I have an obligation, you know, because I have got the subpoena that was served on me. And I have --
THE COURT: From your cohorts.
MR. KRONENBERGER: That's right. But, your Honor, I was fearful that this would happen.
THE COURT: Did you ever hear of a motion to quash?
MR. KRONENBERGER: Regarding -- your Honor, regarding outstanding subpoenas --
THE COURT: Just issue something. You sent them out, you call them back.
THE COURT: And you ought to be in one place. I don't care where, here or there, but this suit does not -- you know, we don't need to have two lawsuits. And this is just the kind of thing that is a good example of what happens. And we don't need to proliferate litigation. There is enough litigation in this country as it is without your multiplying it. And doesn't Rule 11 say something about -- and 1927 say something about multiplication of litigation? Don't do it. Don't go there. Because the next time it will be sanctioned.
At Monday, March 30, 2009 11:36:00 PM,
Anonymous said…
Dear Voting Member,
I wish I could believe what the President and Vice President of the USCF have written to you during this election cycle, but I am writing to tell you that I cannot. They are not openly lying to you, in my opinion, but they are transferring their own massive confusion and misunderstandings of fact to voting members. Our most experienced financial analysts are telling us that we have a financial problem. Schultz, and Goichberg are telling you that we do not.
The facts are clear. Schultz and Goichberg are wrong.
It is small wonder that voters are getting distinctly different accounts of the USCF’s financial status. The leaders of the organization, the very people you ought to be able to trust, are openly, if not intentionally, misleading you. I wish that Don Schultz and Bill Goichberg had not chosen to make Mike Cavallo’s performance in issue in this campaign, but they have.
They Are Wrong About Our Debt
Mike Cavallo has openly boasted about adding $300,000 in capital improvements while maintaining the same level of debt during his tenure in office. Bill Goichberg wrote to you and stated pretty much the same thing, citing the capital improvements and putting the addition debt figure at $78,000. The problem is that this is simply not the case. I wish to again stress that I do not believe that either Cavallo or Goichberg are intentionally lying to you. I believe that they are confused.
When I asked Bill to justify the figure he cited in his letter, it became apparent that he was double counting a $200,000 liability. He counted it first separately and then again under accounts payable. Mike Cavallo was making the same, rather elementary, mistake. His handling of these capital improvements is open to question, but even granting the assumption that they were handled competently, the contention that the debt level remained the same while doing so is ludicrous.
The latest USCF Operations balance sheet available to me is that of April, 1999. Our notes payable (loans) total $464,644.97 this year as opposed to $175,000 last year, which is an increase of $290,000 (rounded). This is from last year to this year! It is absurd to try to blame, as both Cavallo and Schultz repeatedly have done, previous administrations for what we are responsible for today. One is normally allowed a one year grace period, for scapegoating a previous administration, but I think it peculiar to President Schultz to have done so for his entire term of office.
The other big ticket liability item is accounts payable. This April the figure is $432,771.36, while last April it was $225,045.11. The rounded difference is $208,000. We owe more people more money, and we are not paying what we owe in a timely manner.
Simply by adding notes payable to accounts payable, it is crystal clear that we owe close to a half million dollars more than we did last year at this same time!. Cavallo and Goichberg may try to tell you otherwise, but the facts are against them.
They’re Wrong About the Candidates
This increase in debt would be a trend that reasonable people would be concerned about. Yet we have our President calling Steve Doyle’s financial analysis reckless, Goichberg relentlessly mounting personal attacks against the Treasurer, and both Goichberg and Schultz trying to convince voters that it is the candidates themselves who are exaggerating our problems!. What is really reckless is the continuing cycle of first denial and then scapegoating seen throughout the Schultz administration.
Perhaps I’m being unfair. When considering liabilities one ought to also consider assets. Our cash on hand is $7,872.41, which is insufficient to meet payroll, let alone pay down our line of credit! In March two checks were credited as paid accounts, but the checks were kept locked in the office safe until they could clear. This is not in accordance with the generally acceptable principals of accounting, and a further symptom of our cash flow problems. No, I’m not making this up.
If we are struggling to simply pay our bills today following the cash rich Christmas selling season, how are we going to survive the cash poor summer months? More loans?
They Are Wrong All Over Again
Bill Goichberg and Don Schultz have been misrepresenting the facts to voters, and this has led to some confusion. For me personally, this is Deja Vu all over again.
Many of you know that I consider Tom Dorsch a hero. Way back in 1996, he blew the whistle on office management and the federation’s finances. Goichberg and Schultz reacted in their now all too familiar patterns. Don blamed somebody, anybody else, and Bill launched into personal attacks against Dorsch, which have been unrelenting for nearly three years now.
The counter attack against Dorsch culminated in the 12/23/96 motion to remove the Treasurer from core responsibilities inherent to his office. They made the dubious argument that there was no intrinsic relationship between finances and the office of the Treasurer. In a word they tried to shut him up.
Tom did not shut up, but carried on despite the continued attempts to destroy his credibility. His voice grew increasingly more strident. Finally he was vindicated. Five past presidents asked the delegates to formally restore the powers of the Treasurer and they did so by acclamation.
When Mike Cavallo was hired he explained to Goichberg and Schultz that Tom had been correct, or if anything, Tom had been understating the extent of our problems at the time. Mike did an excellent job of controlling expenses in his first year and we seemed headed in the right direction. This proved to be an illusion.
They Were Wrong About Profitability
Both Cavallo, in a press release, and Schultz in his president’s report made extravagant claims as to our profitability. I’ve enclosed those documents as addenda. Our audited financial statement for last year showed a deficit of over $20,000. Where were the profits they predicted? Were they lying? I don’t think so, I think they were confused. Incidentally, these misimpression’s were never corrected, and remain, to this day, what many voters consider to be the facts.
Expense cutting, Mike’s strength, can only take an organization so far. At some point it has to produce sufficient revenue to fuel growth. We remained in a period of stagnation and decline. This year it caught up to us.
Deja Vu Part Two: They Are Wrong Again
In our December, 1998 Board meeting, Treasurer Tom Dorsch again informed the Board of a looming financial crisis. He was immediately attacked by Goichberg. Goichberg demonstrated his ignorance of the situation by issuing an Internet posting that claimed that the deficit was primarily due to stock market fluctuations. He added that we might even run a surplus!
Dorsch asked for the finance committee to review his work, and it turned out that the people with actual financial credentials agreed with Tom and not Bill. They recommended an emergency meeting to be held at the site of the US Amateur Team East.
They Were Wrong to Not Attend
Goichberg and Schultz skipped the meeting. No, I am not making that up. Schultz was actually in the building, but chose not to attend Apparently, these officers of the federation were disinterested in helping to determine the fate of the organization.
They Are Wrong About Dorsch
Perhaps a few of you are beginning to understand why Dorsch becomes frustrated from time to time. Schultz and a Board majority have done everything in their power to frustrate the Treasurer. They consider it a political victory when they aggravate him so much that they get another sound bite!
Dorsch has been right on the issues all along. They are reduced to trying tomake Dorsch an issue. We’ve already seen some of the twenty promised hit letters. Why are they so afraid of this guy?
First Dorsch blows the whistle on problems that everyone now routinely agrees were problems, and they try to strip the guy of his responsibilities. Then we think things are getting better under Cavallo, until we learn that Cavallo and Schultz were playing with fantasy figures last year. They were completely inaccurate, but never issued retractions. After the auditor discovered all the accounting errors in our big turn around year we ended up with a deficit! (I believe that Schultz will be the first President to run a deficit in each of his three years in office.)
When Dorsch blows the whistle on problems in the office and with our finances in December, 1998 Schultz and Goichberg respond with denials and personal attacks. This whole time Schultz and Goichberg are uncritically accepting of whatever Cavallo tells them, and escalating their attempts to discredit Dorsch. It is small wonder that Tom crosses the line from time to time.
These people are infuriating!
Yet, they control the press releases, the web site and the pages of Chess Life. They are confused, but they have the power. Dorsch has valiantly
fought the good fight against the entrenched powers that be, at great personal cost. He is a hero.
They Are Wrong About Next Year’s Budget Too
The biggest travesty of our May, 1999 budget meeting involved the funding for the (alleged) FIDE World Team Tournament. Cavallo proposed funding $30,000 for the event. It turns out that there is no such tournament this year! Who is our Board FIDE liaison? Don Schultz. These guys are confused.
They are telling us that everything is under control, but confusion reigns supreme. I predict that these sorts of mistakes will increase in frequency in the future, because of a misguided policy concerning office staffing. We are hoping to balance the books on the backs of people who are already overworked and underpaid.
http://georgejohn.bcentralhost.com/Geor ... s/je1.html
This was a letter from Eade
They Are Wrong About Our Staffing Needs
There have been two primary responses to the financial crisis that Cavallo, Goichberg and Schultz are pretending does not exist. First, they cut pages in Chess Life. Second, they are letting people go without replacing them.
We can argue the wisdom of cutting one of the few tangible membership services in an era of membership stagnation and decline, but I am most
concerned about the disregard for the professional staff. Theirs is the smallest voice of all. Who will argue for them?
If you guessed that I would, you would be correct. The club director left, the associate director Eric Johnson has gone, and our accountant followed soon after. There is a trend here and it is not a healthy one.
There is no intention on the part of the team of Cavallo, Goichberg and Schultz to replace these people. They are simply asking others to do more with less. Again. This policy is already backfiring. Morale is at or near an all time low. People are discovering that there are better opportunities elsewhere, and the USCF is simply no longer a good employer.
It has long been accepted that we need two executives in the office. We’ve been operating with only one, and he is only in the office three days a week on average. We went from two directors and near universe coverage to an environment where Mike’s absenteeism has really caused problems.
We need to hire a number two person. Mike cannot do the job by himself, and I would argue that no one can be successful in that job by themselves. Mike can continue to hold down expenses, as the de facto comptroller, but we clearly must have a Marketing Executive to capitalize on revenue opportunities, if we are to recover and sustain our fiscal health.
Above all else, don’t continue to balance the books on the backs of the people who remain. Get them some help.
They Are Wrong that Smear Tactics Will Work
Or, at least I hope they’re wrong about that. Goichberg is working harder to defeat Dorsch now than Bill did for his own candidacy in 1996. His personal vendetta has stretched almost to three years. He has used personal attacks, Ken Starr tactics such his Ethics filing, and hit letters to bring Dorsch down.
Do you really think it is because Dorsch has a sharp tongue and doesn’t pull his punches? Or is that Bill understands that his time is past and that Dorsch represents change. Bill belongs in our Hall of Fame for his many contributions over many, many years, but he has been wrong on the issues right down the line during his current Board service. The Internet is our future, but Bill will not profit from it, and he has been frustratingly slow to grasp it. It is time for Bill to get out of the way.
Instead, he orchestrates a nation wide campaign of hate. He digs up people like this Babcock person to write his hit letters for him and ensures that every voting member sees it. You will find my response to her holier than thou screed at the end of this mailing.
Bill has managed to win some share of small triumphs, such as getting the Ethics committee to slap Tom’s wrist with a reprimand. I do not consider Bill to be a white collar criminal, and I wish that Tom would not make such remarks, but I would much rather have Dorsch, warts and all, leading us into the future, than have the Schultz/Goichbergs clinging desperately to the past.
They’ve controlled the media, but the haven’t told you the truth.. Don’t believe them, and don’t let them confuse you.
-----------------------------
Watch out for the mudslide!
While the overwhelming majority of USCF Delegates enthusiastically welcomed the changes proposed by the Blue Ribbon Committee on USCF Governance Reform, there was determined resistance from the small but vocal group that weilds extraordinary power and influence in the USCF. I call this group "the special interests." The special interests failed in their attempt to derail the reform movement, but they have not abandoned their efforts. This is seen by the fact that the first election under the new system this year has been nastier and more personal than any election since at least 1978.
The special interests have targeted the reform candidates, in particular this writer. In Hawaii (1998 US Open), I was promised by Jerry Hanken that he and his colleagues would generate "twenty hit letters" and guarantee my defeat if I chose to run. Although at the time I was leaning against running—three years like the last three is punishment enough for trying to better the organization—I then knew that I had to make the race.
Sure enough, the special interests have fulfilled their pledge to make this a nasty campaign. They have two objectives: to discredit the new reform bylaws, and to exercize veto power over a candidate who has been immune to all their bribes, blandishments, and threats. If their "twenty hit letter" strategy succeeds, we can look forward to this type of mudslinging as a permanent feature of USCF elections, because any strategy that succeeds will never be voluntarily abandoned.
The personal attacks rely on the strategy of taking statements out of context, slightly altered, or misinterpreted—even sometimes completley abricated—to try to show that the victim has bad character.
USCF Treasurer Tom Dorsch
At Thursday, April 02, 2009 2:27:00 PM,
Anonymous said…
Since Bill Goichberg's statement that the Federation didn't start to lose money until the last year (fy 99) that you were both on the Board didn't jive with my memory, and since you also have a different recollection, I went back to check the audited financials. Here is what I discovered:
1996-1997 (fy 97)
Increase or (Decrease) in Net USCF Assets: (117,542).
Gain or (Loss) resulting from LMA investments: 120,601.
Gain or (Loss) due to Operations: (238,143).
Thus for that year, LMA gains masked operational losses.
1997-1998 (fy 98)
Increase or (Decrease) in Net USCF Assets: (2,916).
Gain or (Loss) resulting from LMA Investments: 101,283.
Gain (or Loss) due to Operations: (104,244).
Thus for that year, LMA gains masked operational losses.
1998-1999 (fy 99)
Increase or (Decrease) in Net USCF Assets: (226,505).
Gain or (Loss) resulting from LMA Investments: 148,033.
Gain or (Loss) due to Operations: (374,538).
Thus for that year, too, the third year in a row, LMA gains masked operational losses.
LMA gains or losses are due to the actions of the LMA Committee which acts independently of the Board. Operational gains or losses are under the control of the Board and management.
One anecdote. In Istanbul at the Olympiad in Fall of 2000, Sam Sloan approached me expressing serious concern about LMA losses. I'm afraid that he was shocked when I shrugged him off, but my view was that the LMA operated completely outside of Board control and thus I couldn't do anything about it. In fact, LMA lost (98,096) in 2000-2001 (fy 2001).
Therefore, using the audited financial statements, we can see that serious operational losses started in 1996-1997, and for three years they were masked by gains in the LMA Fund.
Cordially,
Tim Redman
Former USCF President
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