You Were Right; The Pappy Lottery Was Rigged

Reported on PennLive.com: Five PLCB executives were investigated by the State Ethics Commission for, let's not mince words, cheating on the PLCB's Pappy Van Winkle "lottery." 

Let's do a perp walk. 

• Board member Michael Negra
• Cliff McFarland, director of supply chain 
• Tom Bowman, director of product selection
• Bryan Kelleher, director of the bureau of business development for wholesale operations
• Carl Jolly, a retail operations manager

All five of them were found to have participated in a scheme to snap up 'unclaimed' Pappy Van Winkle 12 Year Old bourbon (the "Lot B" bottling prized by the pros) and other allocated whiskeys. See, the PLCB would hold a lottery (which often led to website crashes, and was widely believed to be rigged, though no evidence of that has surfaced...yet) for PA residents to take a chance at buying one of the state's allocated bottles of various whiskey releases. After the results were announced, the winners would then be able to buy the bottles at the PLCB list price, which was, admittedly, often hundreds of dollars less than at private stores in other states. 

'Shopping' at the PLCB Executive Store

But amazingly, not every bottle would be claimed. For instance, the lottery cited in the PennLive article, the January 2020 lottery for the Lot B bottling, had over 17,000 entrants for 999 bottles, and 24 went unclaimed. The rules of the lottery said that those bottles would then be released for a "second-chance" lottery...but the PLCB decided not to do that, and instead the vultures at the top feasted on the remnants. 

Want more? The lottery allowed winning entrants to purchase a single bottle. Ha! Jolly, for instance, despite not having even entered the lottery (why would he? That's for us suckers), "bought three bottles of Pappy Van Winkle bourbon for $410 and separately a bottle of Weller 12-year Reserve Bourbon for $40." That was in one lottery. We're not told how many bottles in total 0were bought by these PLCB parasites. 

There is an aspect to this that is particularly hard to swallow. Their participation is not contested; they all did it, some of them multiple times. They didn't steal the bottles; they bought them, at list price, with their own money. There is apparently no credible evidence that they flipped the bottles to make money; Lot B, for example, is currently going for well over $1,000 in the so-called "secondary market." 

But because there was "insufficient clear and convincing evidence of a pecuniary benefit", the State Ethics Commission found that there was "no violation" of the state ethics code. That's bullshit. The whiskey wasn't theirs to buy, and even if they didn't sell it, they had that potential. That's like saying you're not guilty of theft because you stole a Van Gogh...and then just kept it. I mean, you didn't make any money on it, right? No harm, no foul, baby!

Despite that "innocence," the Ethics Commission's report says that they were each "ordered to fulfill his agreement to not purchase any items offered by the Pennsylvania Liquor Control Board outside of the process by which a Commonwealth resident may purchase such items." Don't the words "fulfill his agreement" sound like a deal was made? 

Of course a deal was made. And once again, the PLCB gets away with this crap. And what do we do? Nothing. That's what we do. Because the miserable PA Legislature has other things to do. Like making it harder to vote, and easier to frack.

Do you remember when the PLCB was the ONLY retail operation to shut down voluntarily in March of 2020? Absolutely closed for six weeks, and not only that, they boarded up the windows because they were afraid of us, that we rampaging drunks would loot their stores. 

Actual PLCB store, Wilkes-Barre, March 2020

Why are these guys still around? Will no one rid us of this troublesome agency?! 

Apparently not, because neither Shapiro's or Mastriano's campaign responded to me when I asked them about their positions on PLCB privatization. I'd remind you that I'm a nationally known whiskey writer, I've testified about these issues before the legislature; I'm not just a blogger howling in the night...but they didn't respond. 

Which leads me to believe that we're screwed. Shapiro is just another Democrat who will veto any privatization bill -- for reasons unclear -- and Mastriano apparently is either beholden to the religiously anti-booze or will be too busy fighting for freedom, whatever he thinks that means. 

But don't worry. These guys promised not to buy booze outside the normal channels again. Pinky swear. 

Looks like it's gonna be a long eight years. 

Ethics questions still percolating at the PLCB

No matter how many pieces of paper the PLCB has to sign, it hasn't changed anything as of yet.

As I reported a year ago today, Jerry Waters, the Executive Director of Regulatory Affairs still has an ongoing ethics investigation and may also be part of the Federal investigation into graft at the PLCB.  If you remember, it took almost two years for the Ethics committee to reach a slap-on-the-wrist decisions for ex-CEO Joe "Water Heater" Conti, ex-Chairman P.J. Stapleton, ex-Director of Marketing James Short, and ex-Director of  Product Selection Matthew Schwenk, all of whom are now being investigated by the FBI.

Nice to know the more things stay the same, the more you can count on the PLCB to do their part to continue be the second-most corrupt agency in PA. Rotten at the top, rotten at the core as the saying goes.

My question is, how long will it be before the next round makes an appearance? If we privatize, there won't be a next round.

News Flash! More ethics problems at the PLCB

In the "Hardly Shocking" Department...

On February 21st, an ethics complaint was filed against PLCB Director of Regulatory Affairs Jerry Waters. It is not the position of this blog to say if he is guilty or not but to report that the violation has been filed. The complaint is listed below (without the numerous pages of supporting documents).

This is yet another ethics complaint filed over the past few years on senior PLCB members, like former CEO Joe Conti, Director of Marketing Jim Short, former Board Chairman PJ Stapleton, and others.  We, the public, have been waiting for the Attorney General to release her decision for some time. Requests are met with the standard "We cannot discuss ongoing investigations" statement. There is some backroom chatter that the the violations have been referred to federal authorities; now wouldn't that be sweet?

Another Ethics Investigation at the PLCB: this time at the top

The Philadelphia Inquirer reporter who's been covering the PLCB, Angela Couloumbis, dropped a bomb in this morning's edition. The headline:

Top LCB officials said to take gifts, favors from vendors 

That got my attention. The article (citing a leaked report from the Inspector General that was supposed to have been delivered to Governor Corbett in late March) detailed how Joe "Da CEO" Conti, PJ "I Used to Matter" Stapleton, and PLCB marketing director James Short have been found to have "accepted gifts and favors from vendors and other businesses with an interest in liquor," according the Inspector General's office. The IG, Kenya Mann Faulkner

wrote that her agency's watchdog role was limited because the liquor board is an independent agency [a situation I've pointed out before, and one that leads to the agency's incredible arrogance] and its officials could not be compelled to cooperate. As a result, she wrote, investigators did not interview LCB employees or vendors. But they did review e-mails sent on state computers and concluded that the Ethics Act had been breached.

What are the unethical actions that the IG's investigation turned up?

Joe Conti allegedly accepted Phillies and Union tickets from companies doing business with the LCB and "lobbied a vendor and pressed others inside and outside the agency - including Philadelphia restaurateur Stephen Starr - for jobs for his brother and daughter."

PJ Stapleton? "...one LCB vendor secured a round of golf with a pro for Stapleton during a tournament at Aronimink - and sent two employees to serve as Stapleton's caddies." Stapleton also

accepted several gifts from an LCB vendor, North Wales-based Capital Wine & Spirits. The gifts included about $1,700 worth of alcohol for an event at the Hotel Hershey last year that Stapleton and his ex-wife organized - the annual Keystone Weekend, billed as a forum for business, civic, sports, and entertainment leaders to exchange ideas on current issues. Stapleton solicited the alcohol and the LCB vendor donated 60 bottles, the report said. It quoted an e-mail sent to him last Sept. 12 by a Capital executive: "The wine and spirits for Keystone weekend is taken care of."

And James Short? I almost feel sorry for the poor bastard: all he did was take Conti's freebie Union tickets one night when Conti couldn't be bothered to accept one more gift.

According to the article, the report has also been forwarded to the state Ethics Commission. What did the accused have to say for themselves? 

Conti, Stapleton, and Short declined through LCB spokeswoman Stacey Witalec to be interviewed for this article. Witalec said, "The board has never been presented with the report, or notified of any formal investigation. We will be prepared to discuss any details when formally notified."

You know, when I saw that headline, the first thing that flashed through my mind, even before "Ah-HA!", was this. Three years ago, there was a scandal in North Carolina about one of their county ABC Boards (their control is even more byzantine than ours) accepting a sumptuous meal from Diageo reps, a Del Frisco's steakhouse meal for 28 ABC officials and their spouses. This was part of a string of scandals involving the ABC, which included gross nepotism and $20,000 of missing inventory at one store. Now, I'm not saying that the PLCB is the NCABC, it's not like there's been a string of scandals at the PLCB...

No, wait a minute. There is a whole list of truly questionable decisions that have been made by the PLCB: you can find it here. There's the wine kiosk single-bidder fiasco (which triggered a special audit by the Auditor General's office), the questionably-awarded 'courtesy contract' misstep (another audit...), the inventory software screwup (wow, another audit?!), and, of course, the still unexplained incident involving "widespread financial irregularities at the PLCB's Philadelphia warehouse where over 20 employees were suspended.

And before anyone accuses me of dredging up the past, re-hashing old issues...there was this little beauty just two days ago: another Angela Couloumbis article on the lax work habits of the PLCB's stable of private judges. This paragraph pretty much sums it up:

Investigators found that LCB judges rarely stuck to normal workdays, often arriving hours late, leaving the office for hours at a time without taking appropriate leave, and going home early, according to the report. Sometimes, the report said, they didn't show up at all.

Guess we know why it's so hard to get a nuisance bar closed.

These stories are like Christmas morning for me. This is exactly the kind of malfeasance that government monopoly retail breeds, and I was pretty sure it was there...and thanks to Angela Couloumbis, now we know it is. It's very satisfying to see how her stories have changed from slightly pro-PLCB to a more adversarial relationship. After all, as Mencken put it, the only way a journalist should look at a politician is down.

Does this mean anything for privatization? You bet it does; it makes it a LOT harder for the PLCB to claim the moral high ground. Time to press the advantage. Tell your legislator you don't want want a monopoly in the hands of arrogant people with questionable ethics who are clearly out of touch with what Pennsylvanians expect. Break the monopoly; privatize. We have a bill on the floor...fix it, pass it, and let it happen.