Lawyers for Welch and Johnson tell of 'kickback scheme'
Attorneys ask judge to deny motion to quash
Attorneys for former bid leaders Tom Welch and Dave Johnson say a former U.S. Olympic Committee official and his wife were involved in "what appears to be a classic kickback scheme" with a sponsor of the 2002 Winter Games.
In court documents filed Wednesday, the lawyers say Susan Krimsky, the wife of former USOC deputy secretary general John Krimsky, was paid $225,000 for what was described as "an entity of little worth" by Sead Dizdarevic, owner of Jet Set Sports.
The documents also state that Susan Krimsky had a business relationship with Dizdarevic from 1992 to 1995, the same time her husband "was the key decisionmaker regarding Dizdarevic's contracts with the USOC" for hospitality packages to various Olympics.
John Krimsky, who was not available for comment this morning, was the chief marketer for the USOC, which jointly sells sponsorships to the 2002 Games with the Salt Lake Organizing Committee.
Krimsky resigned from the USOC in 1999 to take a job with United Airlines and is currently president of YankeeNets Properties, which owns the New York Yankees and other sports teams.
Bill Schreiber, a New York attorney for both Krimskys, declined today to comment on the relationship between his clients and Dizdarevic.
"We don't believe at this time it's appropriate to dignify the allegations," Schreiber said.
USOC spokesman Mike Moran said today that the two investigations conducted by the Colorado Springs-based organization after the Salt Lake bid scandal did not turn up any information about the business relationship alleged in the documents.
Such a relationship would have had to have been reported on USOC disclosure forms, which are disposed of after three years, he said.
The court document asks U.S. Magistrate Judge Ronald Boyce to deny a request by the New Jersey-based travel company to quash subpoenas for "any documents referring or relating to" its interaction with world Olympic leaders over a 15-year period.
"There is strong evidence that (Dizdarevic) and his entities committed criminal and civil currency violations, including intentionally structuring transactions with banks to avoid" federal reporting requirements and "have not been prosecuted or subjected to civil sanction for this conduct, although the government is aware of it," the memorandum stated.
Jet Set Sports is spending some $20 million to be a sponsor of the 2002 Winter Games. The company is selling trip "packages" to the Salt Lake Games that include premium tickets, credentials, transportation and hotel accommodations.
Even before Welch and Johnson were indicted last July, Dizdarevic acknowledged he made contributions to the bid committee between August 1994 and May 1995.
The indictment later alleged that cash deliveries totaling $131,000 were made on four separate occasions in four different cities.
Even though the funds never showed up in bid committee records, Welch and Johnson's attorneys have insisted the money was used for authorized purposes.
The defense attorneys say they expect Dizdarevic will testify at Welch and Johnson's trial, slated to begin July 16, that it was the former bid leaders who requested donations from him for the Salt Lake City bid effort.
But just "who advocated a cash donation will be a contested trial issue," the attorneys wrote. "The Dizdarevic entities' practices of using cash and making confidential contributions are admissible to show that it was Dizdarevic and not the defendants who insisted on using cash and keeping the contribution to the (bid committee) confidential."Federal prosecutors are accusing Welch and Johnson of conspiring to deceive their own board about the bid campaign, handing out roughly $1 million in scholarships, gifts and cash to IOC members and their families.
Contributing: Lisa Riley Roche.