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State auditor admits California’s athletic commission nearly got death penalty… then suggests Che Guevara could take over

By Zach Arnold | March 21, 2013

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To read all CSAC-related articles, dating back to May 2012, CLICK HERE.

Since we’ve covered the mess going on with lifer-since-Jimmy-Carter Denise Brown and her Department of Consumer Affairs in relation to how they’ve operated the California State Athletic Commission, one point has been very clear — the commission was in trouble. Real trouble.

Trouble as in getting sunsetted by California’s state senate, which means the California Democratic Party. As in Darrell Steinberg pulling the plug. Today’s headline in the Sacramento Bee says it all:

Auditor says California athletic commission needs to change or go

Let me translate that for you: “If we didn’t hire Andy Foster, we would have shut the commission down.”

Let me also interpret for you what sunsetting would have meant. It would have meant that DCA would be operating California combat sports the way the DBPR operates Florida’s commission. In other words, a train wreck. Nothing would have been fixed. The only difference is that the numbers would have swept under the rug. And you know who would have regulated California combat sports? Che Guevara. Yeah, that guy. He’s still getting paid $60,000 a year to be a paper pusher but he doesn’t have the authority he once had. He’s just cashing a paycheck.

If the Bureau of State Audits was really serious about cleaning house in Sacramento, they would tell the state Legislature to fire Che Guevara’s sorry ass. But they won’t. So, instead, they once again play for the quick media headlines.

From the Sacramento Bee:

The solvency plan commissioners have since adopted assumes a 35-percent cut in costs from the $1.83 million budgeted in 2011-12. It may not be realistic.

“We are concerned that many of the changes the plan outlines may prove impractical and too drastic to sustain over time,” the audit says.

The commission’s operations are so upside-down that it probably lost money regulating some events. It’s hard to know for sure, because inspectors sometimes miscalculated the state’s take or missed some calculations entirely, leaving the commission vulnerable to “human error or fraud,” according to the audit.

Who was in charge of the athletic inspectors who couldn’t calculate a box office? Che Guevara. Remember this article I wrote? Crystal ball — CSAC audit will reveal up to 7-figures $ missing.

You didn’t need a state auditor to state the obvious if you were reading Fight Opinion. The sad part? People in California combat sports had to read this site to get their information on what was really going on as opposed to trusting Sacramento to tell them what was up. That’s pathetic.

The state auditor, in her report (which you can get the link to later in this article), claims that 50% of the inspectors booked for fight events weren’t local and were out-of-region bookings. Guess who was responsible for that? Che Guevara.

Here’s my message to Darrell Steinberg, Lou Correa, and the state Senate’s Business & Professions Committee. Che Guevara should absolutely be terminated — for cause. This is as slam dunk of a case as you can get. If the California Legislature wants to make a statement to the public that they want to clean house at the athletic commission, you fire Che and you do it now. Simple as that. Fire his ass. And do it publicly, too. Not on a Friday document dump. You fire him with the Sacramento press corps paying attention to what you’re doing.

Do you really want to sacrifice political capital protecting that guy? Cut your losses.

Unfortunately, that won’t happen. They also won’t fire Doreathea Johnson, the legal nitwit at DCA that has had her fingers in the proverbial cookie jar when it comes to the mess at DCA. Hell no, they won’t do that. She just got an internal job promotion by Governor Jerry Brown! What a nasty piece of work she is.

Also, I got a problem with Bureau of State Auditor boss Elaine Howle. A real big one.

This is the same woman who wrote a report late last year about 18 athletic inspectors who are also full-time state employees. She singled these individuals out and claimed that they were wrongly paid time-and-a-half for salary money. That’s a completely false assertion by BSA. You can read more about that right here: California’s audit scam.

So, what did BSA base this incorrect claim on? They based it on a faulty & fraudulent legal opinion, not court ruling, from Cal HR stating that athletic inspectors who are full-time state employees should not be paid time-and-half. As a result of Howle’s opinion bsaed on Cal HR’s memo, she singled out 18 athletic inspectors. These athletic inspectors then received letters of confiscation for money that was paid out to them in 2010. Not letters of confiscation, mind you, for years of back pay. No, just for one year of money that was paid out. As a result of this, Mohammad Noor (California’s top athletic inspector) resigned. Noor also works for the state’s Department of Finance. He’s an auditor. If there’s anyone who knows the rules and actually does his job right, it’s this guy.

As a result of Howle’s faulty report, she claimed that 18 athletic inspectors cost California $120,000 in cash. We exposed that claim for the lie that it is. As a result, when the Department of Consumer Affairs started sending out letters of confiscation to athletic inspectors, DCA started scrambling to try to confiscate money. We exposed the fact that DCA was still “researching the legal basis” for confiscating cash.

They’ll get whacked around in court if they press further.

The Bureau of State Auditor’s report on CSAC

You can read the document (released March 21st, 2013) right here: CSAC’s Ongoing Administrative Struggles Call Its Future Into Question (7 MB)

The 80-page filing has some incredible statements. For example, in the letter to California’s Legislature, this bombshell is dropped:

At that point, the commission attempted to resolve its financial situation by developing a solvency plan outlining its cash?flow situation and containing its proposed efforts to reduce its costs. However, we are concerned that the plan is not practical and that the commission lacks a comprehensive approach to ensuring its financial stability in the long term. For example, the plan proposes drastic cuts to expenses related to athletic inspectors’ (inspectors) wages and travel and effectively prevents the commission from increasing its staffing level, which is likely unrealistic given it has struggled to adequately perform its functions with its current staffing level. Further, the plan eliminates funding for training inspectors on how to properly regulate events, even though state law requires that inspectors receive training within six months of an event that they are scheduled to work. Because of these and other concerns, we do not believe that the commission can use the plan as a long?term solution to ensure its future financial stability.

So, who will the bureaucrats dump this problem onto? Andy Foster. Instead of Denise Brown, Awet Kidane, dysfunctional Doreathea Johnson, and Che Guevara taking the appropriate heat, the weight will be placed on Andy Foster’s shoulders and the blame will be pushed on former Executive Officer George Dodd. Of course. That’s the Department of Consumer Affairs and the Bureau of State Audits for you.

Howle then drops this paragraph in her letter to the politicians:

Moreover, the commission seems ill?prepared to accurately estimate its costs and revenues because, until recently, it has consistently failed to adequately track key components of its operations, including the number of events that it regulates, the revenues and expenditures associated with those events, the number of inspectors assigned to each event, and the number of athletes that it licenses. Finally, deficiencies in the commission’s processes for collecting, recording, and reporting revenues from events suggest that it lacks assurance that it has collected and accounted for all of the revenues it is due.

You couldn’t write a better summary for a termination (for cause) of Che Guevara and yet the state won’t fire him. He continues to be politically protected by forces within the Department of Consumer Affairs and the California Democratic Party. It’s totally and completely absurd.

The controversial Neurological Fund & Che Guevara

Message to Dr. Paul Wallace: remember all that event revenue that was supposed to go to the Neurological fund to help out the fighters? Elaine Howle has this greeting for you:

The commission also lacks assurance that it has consistently protected the health, safety, and welfare of athletes as the law requires. For example, in violation of state law, the commission has at times failed to maintain supporting documentation demonstrating that it ensured the safety of athlete’s gear and equipment. State law also requires the commission to administer the Neurological Examination Account (neurological account), which the Legislature established in 1986 to pay for athletes’ neurological examinations and the Boxers’ Pension Plan, which the Legislature established to provide some financial security to retired boxers; however, the commission has not effectively managed either of them. Specifically, the commission has not used the neurological account to pay for any neurological examinations since at least 1998 and, from fiscal years 2002–03 through 2008–09, it failed to make any pension payments to eligible boxers or their beneficiaries. The current executive officer, who began working at the commission in November 2012, has made noteworthy strides in addressing several of the issues we discuss in this report.

So, all the pressure is on Andy Foster to clean up the mess that hundreds of people have contributed to making. And, yet, instead of backing Andy Foster, Elaine Howles throws this gem out there:

However, if the commission is unable to correct its most significant deficiencies within a reasonable time frame, we believe the Legislature should consider transferring its responsibilities to Consumer Affairs.

As I stated earlier, let me translate what this means:

Che Guevera isn’t quitting his job. You’ll have to fire him to remove him. However, DCA doesn’t want to fire him because he’s a politically-protected species. It’s his fault that the athletic inspectors couldn’t do their job. We know what the facts are.

So, what does Elaine Howle do? She recommends that if Andy Foster can’t fully clean up the mess made by others that CSAC should be sunsetted. DCA runs CSAC and micromanages it with an iron fist now. Giving the death penalty to CSAC means DCA runs California combat sports with no meetings and no transparency. Who at DCA would regulate California combat sports if CSAC was terminated?

Che Guevara.

What we would end up getting, if we played along with Elaine Howle’s scenario, is California turning into Florida and Che Guevara — the man who was most responsible (along with Doreathea Johnson) for creating the mess we have today — running California combat sports.

Howle’s recommendation of terminating CSAC and letting DCA takeover is like a doctor telling a fat person that it’s the grocery store’s fault for selling them the food they ate, not the fat person actually eating so much food. DCA controls CSAC. Terminating CSAC and letting DCA take over regulation in secret does NOTHING to change what is going on right now.

Based on the last two reports about the California State Athletic Commission, auditor Elaine Howle may be good at digging up facts but she’s full of it when it comes to identifying the culprits who created the mess and recommending who should be given responsibility to make the appropriate changes. Howle is part of the problem, not the solution. A political hack hiding behind the facade of neutrality and numbers.

Want some advice, Elaine? How about stating the obvious — that the California State Athletic Commission should be removed from the Department of Consumer Affairs and operate as a self-sustaining entity. You won’t say that because you don’t have the guts to state the obvious solution. You seem more worried about protecting DCA’s power and maintaining the status quo for political hierarchy than actually admitting the unvarnished truth.

Che Guevara is laughing at everyone right now over what is happening. Once the state turns on Andy Foster, guess who takes over regulation of California combat sports? Yeah, that guy. Listen to my Sherdog interview with Jordan Breen about the state of affairs in Florida. That will give you a clue regarding the future of regulating California combat sports if Che Guevara is allowed to take over with no restrictions and full secrecy.

Memo to athletic inspectors: if CSAC gets sunsetted and Che takes over regulation in private, it means all of you will be fired and replaced by DCA-backed employees who will snoop around and cause trouble at shows.

Topics: Boxing, CSAC, Media, MMA, Zach Arnold | 3 Comments » | Permalink | Trackback |

3 Responses to “State auditor admits California’s athletic commission nearly got death penalty… then suggests Che Guevara could take over”

  1. Clint says:

    Your article is sad but oh so true. It is like the old adage “ State employees get promoted to the height of their incompetency.”

  2. John Lovell says:

    It would be tragic if Andy Foster were made the victim of this sorry history. His appointment has been one of the best things that has happened to combat sports. All who love boxing and/or MMA should make their voices heard on behalf of Andy Foster.

  3. Clint says:

    John I agree with you Andy is the only breath of fresh air combat sports has seen in California for years. The problem is the power to be don’t care. If they did they would not be talking about turning everything over to the STATE department of consumer affairs. Someone please tell me just one thing they ( the state) has controlled that they have not screwed up and over staffed with slugs on the state dole.

    By the way Zach, after all your articles pointing out the incompetence of Che Guevara do you wonder why he is still making the big bucks? Well it is because of YOU. Just like in this article you listed his name along with some very powerful people. You force them to protect him to protect themselves. If they do anything to Che, it would add credibility to you. They are never going to do that or anything to him even if it was proven he really is the Che Guevara that was the right hand of Castro.

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