Two of the five ex-staffers of the University of Kansas Athletic Department indicted on federal conspiracy charges related to a ticket scalping scandal entered a plea of guilty in federal court late last week.
Former Associate Athletic Director Kassie Liebsch and former Assistant Athletic Director Rodney Jones, both indicted on federal charges of conspiracy to commit wire fraud, entered pleas of “guilty” before U.S. District Judge Wesley Brown in Wichita, KS, Liebsch on January 13 and Jones on January 14. Jones had initially entered a “not guilty” plea before a Wichita magistrate in December and subsequently requested last week’s “change of plea” hearing. Liebsch did not enter an initial plea but instead requested a continuance for last week’s hearing.
Both have pleaded guilty to federal charges of conspiracy, which include allegations of obstruction of income tax collection and transporting stolen goods across state lines.
Jones and Liebsch, along with former Associate Athletic Director Charlotte Blubaugh, her husband Thomas, and Jones’ ex-supervisor, former associate Athletic Director Ben Kirtland, all were indicted in November on federal charges of conspiracy to commit wire fraud. These charges are related to the group’s alleged illegal acquisition and sale of nearly 20,000 basketball and football tickets belonging to the Athletic Department, dating back at least to 2005. These charges arose from KU’s internal investigation of the Department after federal authorities began investigating Jones’ activities. The internal investigation concluded that the five department employees were responsible for the theft and sale of Athletic Department tickets to brokers and other third parties for profit, and a larger federal investigation ensued.
Prosecutors have alleged that Charlotte Blubaugh stole tickets from the AD’s office and funneled them to Kirtland, Jones, Liebsch, Simmons and Jeffries for the purposes of sale to ticket brokers and other third parties. In order to hide these transactions, payment from these third parties was apparently taken in cash or in checks made out to those not associated with the department. The group also is accused of providing kickbacks to their sellers in return for their services, subverting computer software meant to prevent ticket theft in the department, and omitting the receipt of these outside funds on NCAA forms.
Last week’s proceedings for Jones revealed some the investigative work that led to the current charges, including the IRS becoming aware of unusually strong broker activitiy selling Jayhawk basketball tickets, and their discovery that these brokers were making out checks to “cash” and a friend of Jones was delivering the cash to him. A “trash pull” at this friend’s house by the feds found the stubs of many of the tickets in question in nearly consecutive order. The IRS also found that Jones converted 450 “cash hoards” into money orders of $400 to $500, circumventing currency reporting requirements. In last week’s hearing, Jones’ acknowledged his role in these activities.
Liebsch is up for sentencing on March 30, Jones on March 31. The federal conspiracy charges carry a maximum of 30 years in federal prison and up to $1 million in fines, but both have been assured by prosecutors that they will request reduced sentences for the pair in return for their cooperation. However, the government is seeking a payment of up to $5 million from those indicted as repayment of the estimated value of the tickets sold, and last week Jones accepted his part of the responsibility of that payment.
In July, two other former Athletic Department employees were charged with knowledge and concealment of the ticketing scheme. Jason Jeffries, KU’s former Assistant Director for Ticket Operations, and Brandon W. Simmons, former Assistant Director for Sales and Marketing were charged with misprision of felony, which carries a sentence of up to three years in prison and fines of up to $250,000. The two men have entered guilty pleas, have cooperated with investigators and are preparing for sentencing in March.