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La Mirada Football Booster Club Under Scrutiny by Attorney General

LMHS football coach Mike Moschetti is said to run the booster club. When asked where the money was going Moschetti replied, "none of your business!"

LMHS football coach Mike Moschetti is said to run the booster club. When asked where the money was going, Moschetti replied, “none of your business!” Over $110,000 goes through the organization every year.

 

By Brian Hews

For almost 10 years, the La Mirada Football Booster Club, run by Diane Grimajo and La Mirada football coach Mike Moschetti, have taken in more than $110,000 every year supporting the football program at La Mirada High School.

All levels of the program, Freshman, Junior Varsity, and Varsity, are required to raise funds for the booster club, with each of the 150 team-members giving $250, or $37,500 annually.

Money is also raised through various fundraisers such as the annual Booster Club fireworks stand that earns a reported $20,000 per year, sales of “Spirit Packs” that earned $35,000 annually, the “Powder Puff” game that earns nearly $10,000 per year, the “50/50” drawing at football games that earns over $11,000, as well as many other seasonal fundraisers.

La Mirada High School and the Norwalk-La Mirada School District also gave money to the program.

Even Coach Moschetti’s family got in on the fundraising, donating $15,000 per year.

Yet Grimajo, who was the only person to handle money and had signing authority to issue checks, and Moschetti were the only people who knew how the money, totaling over $1 million, was spent in the last few years.

But now others, along with the California Attorney General, want to know.

A Hews Media Group-Community News investigation has revealed that the Booster Club has violated several California laws and had little or no oversight on where and how hundreds of thousands of dollars were spent every year.

Even more alarming, the Booster Club indicated on all donation documents that it was a registered 501c3 non-profit organization, going so far as using an inactive and non-existent identification number.

The  investigation also revealed that the organization did not have a California Franchise Tax Board number, and therefore did not remit taxable sales from fundraisers to the state.

Finally, no year-end or internal financial statements have been generated since 2006, and sources told HMG-CN that there are no bank statements available from the organization.

Given the lack of a registered 501c3, the booster club has also placed any person or organization that donated money to the club in a tax liability position.

As a result of this stunning mismanagement, the organization could be facing huge monetary penalties for failing to pay payroll taxes, failing to withhold taxes on independent contractors, and failing to pay sales tax.

The investigation has also revealed that current and past Norwalk-La Mirada Unified School District School Board members, ex-NLMUSD Superintendent Dr. Ruth Perez, La Mirada High School (LMHS) Principal William “Bill” Seals, Moschetti, and LMHS Athletic Director Armando Rivas knew what was going on and either took action to cover the mismanagement up or did nothing about it.

++++++++++

The questions of mismanagement started in 2012 with a series of emails from concerned freshman parents.

There was no communication from the booster club informing the parents where the money their children raised from fundraisers was going.

One parent had the opportunity to ask Moschetti personally where the money was going and Moschetti responded “its none of your business.”

At the time, money was being paid to eighteen varsity coaches, three varsity team trainers, a varsity team chiropractor, and a public relations company.

LMHS Principal Bill Seals was informed in 2012 of the discrepancies and told Moschetti about them, but nothing was done.

According to the emails obtained by HMG-CN, questions began resurfacing in August of 2013 when former La Mirada Mayor Pete Dames received a request for donation letter from the football team.

The donation letter was on LMHS letterhead.

Letterhead

Dames found it unusual that the letter was on LMHS letterhead so he decided to look into the Federal Tax ID Number (FTIN) and non-profit number listed on the letter.

Dames learned from a Certified Public Accountant that the FTIN was delinquent since 2004 and found that the non-profit number was non-existent.

Dames sent an email to Grimajo who blamed the Treasurer before her and said that she was “working on that (the FTIN) now, and that the taxes have not been filed, but it was no biggy.”

No-biggy

One month later, Dames sent an email to NLMUSD Board Members Jesse Urquidi and Chris Pflanzer, along with  Principal Seals and Kim Brooks, former LMHS Athletic Director.

Dames indicated that the booster club did not have an FTIN, had not filed taxes for over ten years, and nobody except Moschetti and Gramajo knew where the money was going.

Also none of the coaches who were paid by Gramajo was given a 1099 Independent Contractor tax form, subjecting the coaches paid to taxes and penalties.

Coaches-pay

No action was taken, although sources tell HMG– CN that Pflanzer and others were stonewalled by some members of the NLMUSD Board.

Frustrated by their inaction, sourcing telling HMG-CN that Board Member Urquidi had several good friends as varsity coaches, Dames fired another email to LMHS Principal Bill Seals explaining the donation letter and the lack of transparency and control within the Booster Club.

Eleven days later, Dames got a response from Seals that said, “I met with Brooks, Moschetti, and Gramajo, I asked for documentation, they provided me with some paperwork which I’m mailing to your home.”

Dames did not receive the “financials” until almost one month later on Dec. 4, 2013, and found them to be “extremely unprofessional with some numbers not matching up from the year before,” according to Dames.

++++++++++

In the interim, several additional emails that indicated complete mismanagement  started in November 2013 when a parent, who had a son in the football program, sent an email to Grimajo asking for an accounting of the money generated by the freshman team.

Gramajo had recently sent an email out to the parents indicating the freshman “were $7,000 short in their fundraising and they (the kids) would not participate in any year-end activities unless the money was sent in.”

As the Gramajo emailed circulated, one mother asked for an accounting of the funds received and spent exclusively on the freshman program.

The email faulted Gramajo for “not communicating whatsoever with the freshman team” in regards to fundraisers, how they were conducted, and how the money was spent.

She also pointed out several discrepancies in the program including how the freshman team paid for new football jerseys that Grimajo said “must be returned to the team at the end of the year for use next year.”

The parent also copied the email to Moschetti and Dames.

One hour later Grimajo’s responded with a terse email saying, “revenues are lumped into one pool…it is the collective opinion of the entire coaching staff that we do that.  I am working on financials and they will be available soon. Any questions regarding how the money is spent should be directed to the head coaches.”

The parent snapped back in a later email, “I’m struggling to see how keeping everything lumped together allows you to account for the $7,000 loss the freshman team has.”

The communication between the parents and Gramajo would have likely ceased, but she copied the email to Dames.

++++++++++

Dames then began comparing the financials from 2012 with financials he received on Dec. 4, 2013 and immediately noticed some major discrepancies.

He compared what was given to him by the parents and noticed that items were missing from the financial reports included $9,000 from the “Powder Puff” football game and over $10,000 from 50/50 drawings at football games.

Frustrated, Dames fired another e-mail to Seals and Urquidi outlining the discrepancies. Dames ended the e-mail by saying, “there is no need to reply to my questions. I know the situation will not change, it appears some leadership at NLMUSD and LMHS has stuck their collective heads in the sand.”

++++++++++

It would be almost another year of non-reporting and fundraising before the issue with the Booster Club resurfaced.

In that time former LMHS Director Brooks was removed from his position after an audio was released of him verbally abusing some of his baseball players. Brooks was replaced by Armando Rivas.

That is when the Booster Club began playing hardball with Dames through Rivas, in apparent retribution for Dames bringing attention to the mismanagement.

Dames had been a volunteer coach at LMHS for the past 30 years.

Asked to coach again in early September 2014, Dames learned through a third party days later that Rivas did not want him on the staff.

Rivas

After several emails over a five-week period, Rivas, a known friend of Moschetti who sources tell HMG-CN that “Rivas will not do anything unless Moschetti approves it,” wrote back to Dames.

Rivas wrote, “this communication is in regard to the freshman baseball coaching position at LMHS. During the past couple of years you’ve developed concerns relating to procedural practices being utilized in the LMHS Athletic Department. …You e-mailed school board members and district personnel without first approaching the Athletic Director to express your concerns… ultimately these actions made it more difficult for the department to attempt to find solutions to your concerns… as a result I have determined… that I will not employ you as coach.

Only days later, Dames was slammed on the “Eagle Lancer” Facebook page for his opposition to the Measure G Bond for the Norwalk-La Mirada School District.

The administrator, who is anonymous, wrote several disparaging remarks and posts against Dames even going so far as posting his address and cell phone and calling him “a despicable 70 year old man who hates kids and you should go to his house and tell him off.”

FB

Now California Attorney General Kamela D. Harris’ office is inquiring.

The Booster Club has received four letters from the Attorney General warning of assessment of penalties and late fees and suspension of registered status.

The letters were dated February 21, 2014, March 13, 2014, May 8, 2014, and September 9, 2014.

See letters click here.

The letters indicated that the Booster Club had not filed the registration renewal fee and paperwork or filed financial statements dating back to 2008, and warned of suspension or revocation of the nonprofit status.

Penalties and fees would be assessed if the paperwork was not filed correctly. The letters noted that money from the booster club cannot be used to pay penalties and that officers of the organization would be personally liable.

Apparently Grimajo and Moschetti did not pay attention to the warnings.

In checking the Attorney General’s website, the Booster Club was officially suspended on October 27, 2014.
SUSPENSION

HMG-CN attempted to contact all parties involved, no one had returned messages as of today, December 12.

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Dean_Neyer
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Dean_Neyer

After painstakingly reading the comments from the damage control team, it seems clear that LMHS should drop all their athletics programs, and trade all the overpaid coaching staff for more English teachers.

mike barnash
Guest

After reading your rant elaineh, I definitely believe you are capable of doing something out of ignorance.

ron
Guest
ron

To the blind. Pete dames had started to ask questions back in august of 2013. How can he be doing this, as an old bitter man with out a coaching job, when at the time he started with questions he was a coach. He wasnt asked back as a coach till sept. of 2014

LM Athletics Head in Sand
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LM Athletics Head in Sand

The documentation is clear from the state filings. Say what you want about trying to protect the thieves and scoundrels in the LM athletic program by shooting the messenger, but the whole thing stinks to high heaven and it all started out because of an innocent inquiry. If the program was on the up and up, then the $7K answer could have been handled. Unfortunately, this is fraud. I hope the state AG, FTB, or IRS look into the mail or wire fraud. These people better lawyer up, and fast.

The Truth Hurts
Guest
The Truth Hurts

HA! I just gotta laugh at all these knuckleheads sticking up for these alleged crooks. Ya’ll chirping like your an insider or something. People have been whispering for years about all the stealing going on. From reading the comments you people sound like your new to the program here. Your comments are stupid and lack any credibility. Once you make it personal, you’ve lost. So just keep picking on the old man who helped La Mirada High Athletics for decades. Dopes. Now, Gramajo, Rivas, Moshetti and Brooks are gonna have to do some quick books cooking. If you paid any… Read more »

Insightful
Guest
Insightful

To SUSAN…you say the author has his facts wrong and things won’t go well once the facts come out. Which ones does he have wrong? Which ones will come out to show otherwise? Do really have any idea? To NOT IMPORTANT…despite all the red flags, you say that you believe that nothing illegal is going on here and this is a waste of valuable resources. I know of fund raiser abuses that occurred in LM Baseball Association and twice in LM AYSO during the years my kids participated because of a lack of oversight and controls. How is this different?… Read more »

Ryan
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Ryan

I know the people in this article and I would suspend judgement on Moschetti and the volunteers who run the booster club until the facts come out. There is a lot of hearsay in this article, coming from one seemingly bitter source, and if it is not slander, it is very close to it.Last I heard Karen Sumpter in the office was in charge of the tax/NPO end of the booster clubs

IRS
Guest
IRS

What are you taking about hearsay? The article has all the documentation! Dames brought this up two years ago along with several freshman parents and no one did anything. Grimajo asked for 7,000 from the freshman parents because they “came up short in their fundraising,” then could not reconcile the money! So how does she know they owed 7,000?. Dames is 70 years old, what axe does he have to grind? He was fired (as a volunteer) after he began informing the NLMUSD Board about the club, Oct 14 of this year. And by the way…brush up on your diction…slander… Read more »

Tom
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Tom

The documentation is E-mails you dope, we don’t even know they exist and can be EASILY manipulated. Dames was fired in September, according to the article, but good try. The school athletic department has the right to not hire someone. When we have facts, this argument is possible, but now, the ONLY thing with any merit is an expired tax ID

Susan
Guest
Susan

Brian I’d say writing this article was not a very good decision you have lost a lot of creditability. Your facts are wrong and you’re being fed by a miserable unhappy man. Now you have slandered not just Mike Moschetti but also Diane Gramajo, Bill Seals, the football program and other staff members. I can’t imagine this goes over well once the facts are looked at.

Susan
Guest
Susan

This is a miserable old man upset that la Mirada doesn’t want him coaching with a personal vendetta against Moschetti . Pete Dames you’re a joke.

elaineh
Guest
elaineh

It is ridiculous, I checked and Moschetti wasn’t even working at the school in 2004 and a friend said that there were different parents running the booster club back then. So it sounds as if this Dames guy is crying cuz he wasn’t invited back to coach and is trying to take down this program. My friends who were involved in the boosters back then said that they used to go to the practices and recall Dames using very colorful language berating the kids if they didn’t do what they were supposed to do at practice. And one of the… Read more »

OMG
Guest
OMG

This is typical shoot the messenger and not listen to the message. So let’s assume what you all saying is true, does that justify Grimajo and Moschetti’s actions as it relates to the club? Failing to file tax returns Dames fault?. Failing to file 1099’s to over paid football coaches Dames fault? Sending out false federal Tax ID’s Dames fault. Sending out a fake non profit number Dames fault? The only signer on a $120,000 account with no supervision no financials and no tax returns and y0u think there is no skimming? I have got a bridge I want to… Read more »

Ignorance
Guest
Ignorance

Ignorance is bliss right elaine? So I get you logic, what you are saying is that if a bank ripped people off and the CEO was fired, then the next CEO can ignore the history and rip people off again? So if you come into a company and see major mistakes going on, you just let them slide and not fix them, endangering the entire company? Give me a break, you are the one who is misguided and blind to what is going on…

Not important
Guest
Not important

This is ridiculous, I have a pretty good idea where the money has gone, new uniforms, equipment athletic gear for the kids, Has anyone questioned why The people asking where the money is going, have done so?, Maybe it’s because they want a piece for themselves. Every high school program has to fund raise and you can cherry pick every program and ask where the money is going but in the end the purpose of fundraising is to help the kids in their program. I don’t believe there is anything illegal going on here and I think this is a… Read more »

OMG
Guest
OMG

Aha must be someone who knows MOschetti or Grimajo. Defending someone who has put the club in jeopardy of losing their status, subjected the coaches to penalties for not reporting their income, the only signer on checks yeah no skimming is going on! The mom’s just asked for an accouting because Grinmajo said they were 7,000 short while not having any financials to show. How did she come up with the 7,000 if all funds, according to Grimajo, were co mingled? Yeah nothing is going on huh?

Not important
Guest
Not important

So if you believe there is skimming going on where is the evidence, are any of the named people driving fancy cars, moving to bigger houses showing off extravagant things? NO but you seem to take the side of blanket accusations because they were written in an article?. Here’s what I have seen new uniforms, clothing gear, equipment, spots merchandise and lots of stuff going to the kids, that’s a pretty big indication of where the money is going. Why should they provide a parent with detailed accounting of where the money is going thats a huge hassle with no… Read more »

elaineh
Guest
elaineh

Now this paper is the same paper that did a smear job on Norwalk HS for firing their baseball coach. This paper allowed him to vent against NHS without investigating the allegations he was saying. And the same thing is happening here. By allowing this embittered, released football/baseball coach his 20mins of fame he is denigrating the only high school in the city. The man must be off his medication or he is just an angry old man seeking revenge for denying him what he wants. It is hard to believe that he is the head of the La Mirada… Read more »