In The Rough A course project gone awry led to a criminal charge against ESPN founder Bill Rasmussen

Oct. 22, 2001
Oct. 22, 2001

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Oct. 22, 2001

In The Rough A course project gone awry led to a criminal charge against ESPN founder Bill Rasmussen

When he conceived the idea of a course called Stadium Naples in
1996, ESPN founder Bill Rasmussen envisioned a 12,000-seat
grandstand wrapped around the 18th green of a tournament track
built to host the IntelliNet Challenge, the Senior tour event he
controlled. However, Stadium Naples and its companion
residential and commercial developments were never constructed.
Last Thursday, Rasmussen had to settle for an 80-seat courtroom
in Collier County, Fla., where he pleaded not guilty to
conspiracy to participate in a racketeering enterprise, a felony
carrying a sentence of up to 30 years in prison.

This is an article from the Oct. 22, 2001 issue Original Layout

Rasmussen, 69, was one of 10 Collier County officials, real
estate developers and a lawyer charged in state circuit court
after a four-year investigation by Florida prosecutors. Four of
the defendants--two former county commissioners, a former county
manager and a developer--have already pleaded guilty or no
contest to various charges and face sentences ranging from
probation to 15 years. A third former commissioner, John Norris,
who pleaded not guilty, allegedly received $30,667 as he was
casting votes that funneled $1 million in county grants to
Rasmussen's tournament. "Corruption had become institutionalized
in Collier County," Florida special prosecutor Michael Von Zamft
told SI last Saturday. "The people involved thought everything
they were doing was O.K."

The alleged offenses make up a litany of white-collar crimes.
According to the charges brought by Von Zamft, one commissioner
played golf for free more than 40 times. Another commissioner
had his wedding reception paid for by a developer. Other
conspirators settled for cash.

The defendants in the case are politically and socially
prominent on Florida's southwest coast. One of them, David
Mobley, a partner in Stadium Naples, made local headlines in
July when he pleaded guilty to federal charges that included
four counts of fraud for bilking $120 million from investors in
his Maricopa Investments firm. Thursday's pleadings got as much
attention from the Naples media as anthrax scares and
geopolitics. ("You'd have thought they caught Bin Laden here,"
said Dave Kempton, an area businessman.) Across the state, in
Ponte Vedra Beach, PGA Tour officials tried to distance
themselves from the scandal, pointing out that Rasmussen ran the
Naples tournament for only two years and lost his Tour contract
after his foundering company, IntelliNet, defaulted on
sponsorship fees for 1994, '95 and '96, and his Challenge
Foundation failed to pay bills for the '98 tournament. "This was
a very isolated case," said Ed Moorhouse, the Tour's chief legal

In making his case, Von Zamft will argue that Rasmussen used his
reputation as the founder of ESPN to attract investors and put
off his creditors. Rasmussen came up with the idea of a 24-hour
national sports cable network in 1978 but was squeezed out of
ESPN a year later, shortly after the Getty Oil Company purchased
an 85% stake in the company. When ESPN was sold to ABC in 1984,
Rasmussen says he collected $30 million, but SI estimates his
personal take was only $700,140. His subsequent business
ventures include a national sports radio network that went broke
in nine months, a television sports production company that cost
the Big Ten Conference a bundle and IntelliNet, a home-systems
automation company that lost $12 million in three years. To act
as investment banker for the stadium-golf project, Rasmussen in
the summer of '97 briefly brought in the brokerage firm A.S.
Goldmen, which closed in 1999 when 31 of its employees either
entered guilty pleas or were convicted in New York State Supreme
Court in Manhattan on securities fraud charges, including some
involving their firm's handling of investments in the Stadium
Naples project.

In January 2000, Rasmussen lent his name to Sports At Home, a
now moribund dotcom that had planned to stage $1 million online
sports competitions. As a result of the charges filed against
him, Rasmussen resigned on Monday as the firm's nominal chairman
at the request of Sports At Home CEO Wes Monty. As for
Rasmussen's connection to ESPN, a spokesman for that network,
Dan Quinn, told the Naples Daily News, "He's a distant part of
our history."

The memories of Rasmussen are a little fresher in Naples and
Ponte Vedra Beach. As head of the Challenge Foundation, the
nonprofit corporation set up to run the Naples tournament,
Rasmussen paid himself a six-figure salary and, in the view of
John Counsell, a Naples businessman who worked as sales manager
for the foundation from June 1996 to April '98, generally spent
its money too freely. Rasmussen ended up in several
tournament-related financial disputes. He admits that he never
gave local Rotarians $40,000 he owed them for parking cars for
six days at the '98 tournament to raise money for charity. At
the end of that event, won by Gil Morgan, Rasmussen went out on
the 18th green and presented a large nonnegotiable cardboard
check for $770,550 to the chairperson of Quest for Kids, a
nonprofit agency that provides educational help to disadvantaged
students. However, the charity actually received only a small
fraction of that amount.

To protect its good reputation, the Tour has tried to mollify
tournament vendors who have complained that Rasmussen's
foundation never paid bills, some running into six figures, for
food and services for the '98 tournament. "The Tour wanted us to
keep quiet about it, not make any waves," says Prom Catering
co-owner Bill Given, who figures his company is owed $97,000.

"Rasmussen still owes us $106,000," says Smitty Smith of Kirby
Rentals, which provided tables, tents and other items for the
tournament. "The Tour people told us that they would clean it
up. We waited and waited, but nothing happened." (Says
Rasmussen, "What gets overlooked here is that the vast majority
of vendors were paid.")

Naples-area taxpayers got some relief in February 1999, when the
Tour paid Collier County $196,000 in restitution for the portion
of the $1 million in grants that the county claimed Rasmussen's
foundation had spent on tournament-related expenses not
permitted under terms of the grants. The Tour wrote Rasmussen
demanding the $869,500 that the Tour had spent to cover the
tournament purse. Rasmussen ignored the letter and claimed that
the Tour's subsequent silence proved he'd done nothing wrong. To
date, neither the Tour nor other creditors have sued the
foundation or Rasmussen, who lives with his wife, Lois, in
Hilton Head, S.C. Says a Tour official who did not wish to be
identified, "One thing we considered is the difficulty of
collecting anything from Rasmussen."

On Sunday, Rasmussen told SI, "I have done nothing wrong. I will
fight every way I know how." In a lengthier interview in 1999 he
blamed most of his troubles in Naples on local politicians,
hotel interests--which he claimed wanted the county
tourism-development money he'd received--and the Naples Daily
News, which disclosed his relationship with Norris and gave
front-page coverage to the A.S. Goldmen case. As for his string
of business failures, Rasmussen said, "I've tried a bunch of
things. That's what entrepreneurialism is all about." He added,
"I have never knowingly done anything bad to anybody."

COLOR PHOTO: PHOTOGRAPH BY GREG FOSTER Pay call Rasmussen in 1994, '95 and '96 defaulted on sponsorship fees owed to the PGA Tour.COLOR ILLUSTRATION: TIM STAMM Grand design Stadium Naples was supposed to be the home of Rasmussen's IntelliNet Challenge but was never built.
"Corruption had become institutionalized," Von Zamft said. "The
people involved thought everything they were doing was O.K."