JCPS joins IRS in investigation of high school booster club

Published: Aug. 3, 2011 at 9:46 PM EDT|Updated: Dec. 28, 2011 at 8:02 PM EST
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FERN CREEK, KY (WAVE) - Bingo was big business for the Fern Creek High School Athletic Association. Now that booster club, at the time run by the school's athletic director and head baseball coach, is under investigation by the IRS.

"I've lived here all my life," said Mary Johnson.

Johnson is close to Fern Creek High School. A graduate of the class of 1967, Johnson has two sons who played football for the Tigers, and her house is right behind the field. So when she heard the IRS is auditing the Fern Creek Athletic Association over huge sums of money that is unaccounted for, Johnson said she was shocked.

"It's kind of like whoa, what happened?" she said.

According to Charles Adkins, an attorney hired to represent the Athletic Association, the IRS is auditing the group's finances, paying particular attention to $130,000 that is unaccounted for between the years of 2006-2009. During those years, the booster club was run by current Fern Creek athletic director Troy Johnson. Head baseball coach Jarrad Durham sat on the board of directors.

In an email to the WAVE 3 Troubleshooter department late Wednesday afternoon, Johnson wrote:

"I am aware of an IRS audit of the Fern Creek Athletic Association. The audit is not yet complete. The association and I are fully cooperating in this audit and look forward to reviewing their findings so that we may respond appropriately with any needed remedial action. I am taking this very seriously because it is a big deal and have been open and honest with everyone associated with this audit."

Adkins said the money was raised during bingo and pull tab games at Charity Hall Bingo on Dixie Highway. Tim Fries, the current athletic association president and someone who was not a part of the group during the time in question, told me that in addition to the $130,000, the IRS is looking into another $350,000 unaccounted for from a second Fern Creek High School booster club that's now out of operation.

Adkins, a former criminal investigator for the IRS, said it's unclear whether any laws were broken. But he admits it doesn't look good.

"Anytime you have a large amount of cash in an organization with very little accounting safeguards, money tends to disappear," said Atkins.

Wednesday, the Jefferson County Public Schools revealed the Fern Creek Athletic Association violated district rules by using the high school's tax ID number to obtain a gaming license. Johnson and Durham have been allowed to stay on the job pending the outcome of the IRS audit and a JCPS investigation launched just this week.

It is unclear if the IRS will turn its findings over to its criminal division. Our calls to the IRS for comment were not returned. Even if criminal charges aren't filed, the athletic association could be stripped of its non-profit status and forced to pay back more than $100,000 in back taxes.

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