“Evidence is also mounting that the assets of the estate will be only a fraction of the amount needed to satisfy the anticipated claims against the estate"

Not a huge shock here, but it looks like Stanford Financial has few assets to pay off investors or "Eagles for St. Jude."

Speaking of that program, it appears that primary sponsor Stanford has been erased from the program website already, even though it had been announced at one time. At least, I can't find their logo anywhere. Not counting Vijay's shirt (left).

"It's not the clients and company executives who suffer if companies cancel their events. They'll find other fun things to do that weekend."

The WSJ's John Paul Newport on the PGA Tour sponsorship issues from this week:

Golf, with its traditional fat-cat image, is an easy target for abuse, some of it deserved. I'm one who has long believed the game skews too fancy for its own good. But the trouble with this week's rabble-rousing, apart from whatever damage it does to the effective business practices of banks and other troubled companies, such as the automakers, is the chill it casts over the entire microeconomy of golf, and of sports in general.

A few weeks ago I wrote about how the drying up of corporate outings to golf resorts, mostly for fear of projecting the wrong image in the current economic environment, was creating travel bargains for the rest of us. But it is also devastating the golf resort and hospitality industry. The same holds true for the drying up of client entertainment at golf and other sports events.

"It's not the clients and company executives who suffer if companies cancel their events. They'll find other fun things to do that weekend. It's the 20 guys who valet-park cars for minimum wage plus tips, the 15 cooks in the kitchen, the six dishwashers, the rigging guys who put up the stage, the housekeepers who make up the hotel rooms where people stay," said David Israel, a TV producer who is involved in the sports economy as vice chairman of the California Horse Racing Commission and past president of the Los Angeles Memorial Coliseum Commission.

And...

"It seems to me that if the goal is to get the financial system working normally again, you've got to let businesses do what they know how to do best to make money," Mr. Israel said.

“Promoting this event with our brand could send mixed signals about our priorities to many of our stakeholders"

Wells Fargo guy on the event formerly known as the Wachovia Championship: “Promoting this event with our brand could send mixed signals about our priorities to many of our stakeholders," which, after run through the MBA Jargonometer, means, "We aren't going to become the next Northern Trust.

First reported by Sports Business Daily and fleshed out by several including Bloomberg's Ari Levy and David Mildenberg, we see the first PGA Tour event going retro. Presenting, the Quail Hollow Championship.

Wells Fargo Chief Executive Officer John Stumpf and Chairman Richard Kovacevich are among executives who won’t receive bonuses for 2008 because Wells Fargo didn’t meet its performance goals, the bank said today in a regulatory filing. Separately, Wells Fargo changed the name of the Wachovia Championship in Charlotte, North Carolina, to the Quail Hollow Championship and said it won’t host client events tied to the tournament. Wells Fargo acquired Charlotte-based Wachovia in December.

“Anyone who is taking any type of TARP money is going to have a harder time sponsoring these kinds of events,” said David Lykken, a consultant at Mortgage Banking Solutions in Austin, Texas. “These are legacy ventures.”

And the spin...

“Promoting this event with our brand could send mixed signals about our priorities to many of our stakeholders,” said David Carroll, a Wells Fargo executive, in a statement.

Wachovia renewed its contract with the PGA in 2008 and extended it through 2014. Wells Fargo still plans to honor sponsorship obligations and hasn’t determined what the tournament will be named in future years, spokeswoman Mary Beth Navarro said in an interview.

Ron Green Jr. quotes the club president and tournament director:

“All of us involved with the tournament have enjoyed the last six years and are looking forward to doing something very special with the tournament over the next six years,” Quail Hollow Club president Johnny Harris said.

“We have been working diligently to do what is necessary to produce the premier stop on the PGA Tour and we feel strongly this will do nothing but strengthen the golf experience for our players and patrons.”

Is that a nice way of saying people really don't like to see corporate logos everywhere?

And this is beautiful...

“This clarifies a lot for us,” Hougham said. “Now there is a name that can stay on the tournament for the next six years. We’ll work with the bank after this year’s event and we hope they stay involved.

“With the new name, it gives us a solid brand to build on for the future, just like we built the old brand.”

Oh yes, this is prime branding 101 textbook stuff!

Northern Trust Hostage Crisis Enters Day Three: Media Steps In To Defend Tour And Sponsors

Isn't it wonderful seeing everyone get along, and more importantly, sticking up for the PGA Tour as a viable and reasonable marketing tool. Well, until it has to stick up for itself.

John Powers says Northern Trust should give back the TARP money and keep on sponsoring golf tournaments.

Garry Smits takes Maureen Dowd and TMZ to task for stretching key facts and writes that TMZ should have stuck to what it knows -- Jessica Simpson's weight or whether Jennifer Anniston still pines away for Brad.

Andrew Malcolm says a conservative watchdog group wants to know more about the relationship between Northern Trust and the Obama's.

And Ron Sirak really lays into the Dowd column, doing the PGA Tour's job of laying out talking points to defend golf sponsorship (okay, maybe minus the Tiffany trinket bags for a while, eh?).

That there is much reform needed in the U.S. economy seems to be indisputable. The business practices of the financial services industry, in particular, need serious scrutiny. No one can argue with that. But the scope of the problem extends well beyond professional golf tournaments and entertaining at those events. To rip golf is an ill-informed, easy way out -- a smokescreen retarding real reform.

What seems to be happening is that golf has become a convenient scapegoat for frustrated pundits and politicians who rely on the fact that an ill-informed public can be manipulated. Golf is not the enemy here, nor is the PGA Tour. The sport, in fact, is an extremely effective and cost-efficient marketing tool.

Is The PGA Tour Going To Fight Back?

Granted, they've talked about their charitable work so much that some people might not want to hear it, but in response to media attacks on golf and tournament sponsorship I would have expected a more visible sign of urgency from Ponte Vedra.

Perhaps some talking points about what the PGA Tour means to the economy? Or maybe some World Golf Foundation bullet points on the game's economic impact? Just something to stop the bleeding.

Maybe this piece of New York Post composite art accompanying a Bloomberg wire story and courtesy of reader Jim will do the trick:

"I would still say we are in a position where we can see lesser growth — but growth."

The most disturbing thing about FBR pulling out of the Scottsdale stop (thanks Steven T.) is not that a penny stock investment group can't go on, but that the Commissioner is talking about "bumps in the road" and offering this as reported by Doug Ferguson. Finchem is discussing extensions with Travelers and Accenture during a press room gathering Tuesday:

"In these times, any level of growth is a victory," he said. "And if I had to guess right now where we come out after another year of this, I would still say we are in a position where we can see lesser growth — but growth."

Is the growth mantra is appropriate right now? I'm guessing Greg Norman suggesting this (thanks reader John) would not agree with Commissioner:

"Prize money's being scaled back in Europe, I wouldn't be surprised if prize money's scaled back in the U.S. just out of respect to every citizen and taxpayer over there who's suffering dramatically," the two-time British Open champion was quoted as saying Wednesday on the Australian Broadcasting Corp. Web site. "It seems like on the PGA Tour the players are still playing for a million dollars first week, like they're recession-proof.

"I think there's got to be a lot of sensitivity shown. If I was PGA commissioner that's what I would be recommending," he said.

The Day Corporate Cool Died?

I leave for a few hours and we go from a shoddy TMZ report with exaggerations and blatantly incorrect information about the Northern Trust Open, to prominent members of Congress using it to call for everything but a public execution.

There are a number of ways to look at the Northern Trust situation. Obviously it's hard to sympathize with a group that received TARP money going on to do over-the-top entertaining when other recent examples of such excess have turned prominent companies into dirty words (A.I.G.).

Northern Trust signed on as L.A. Open sponsor to build it's brand in the west. Well, today they went national today.

On the other hand, Northern Trust is a victim here. Having been forced to take TARP money they apparently forgot there were new rules of doing business attached to that money no matter how unnecessary they believed it to be. If CEO Rick Waddell and his board had any cojones, he'd hold a press conference tomorrow with a big $1.6 billion winner's check in his hand and an offer to give it all back to the government.

My initial reaction to these events has more to do with the PGA Tour and the future of the sport. You may recall that I spared you more detailed thoughts about the direction the L.A. Open has taken with Northern Trust and PGA Tour's Championship Management whispering in their ears to push out the L.A. Junior Chamber of Commerce, corporatize everything in sight and in general, make the event more like events the PGA Tour operates: bland, soulless and devoid of local character but "elegant" to the discerning corporate clients visiting from Chicago who can pass a blindfold taste test between Grey Goose and Smirnoff.

While some of you might giggle at my pleas for an 18th green manual scoreboard, it's little things like this that lie at the heart of the utterly disastrous direction the PGA Tour has taken where the corporate world takes total priority over the experience of the everyday fan.Do we really need an on course concierge? (click image to enlarge)

As Barack Obama spoke Tuesday night and made the boldest declaration yet to end corporate greed, malfeasance and excess, I couldn't help but think that the PGA Tour had better be holding emergency meetings through the night figuring out how to wean themselves from a fatal attraction to this peculiar world of arrogant excess that mercifully died on February 24, 2009.

Obama: "I intend to hold these banks fully accountable for the assistance they receive, and this time, they will have to clearly demonstrate how taxpayer dollars result in more lending for the American taxpayer. This time, CEOs won't be able to use taxpayer money to pad their paychecks or buy fancy drapes or disappear on a private jet. Those days are over."

Countrywide was visible at the 2009 NTO (click to enlarge)This doesn't mean golf or the days of golf tournament sponsorship are over. Nor does this unravelling of greed and corruption mean that corporations are going to be going away as hosts of golf tournaments and supporters of the game. And nor do we want them to go away.

However, the folks running the game are going to have to rethink their complete and utterly nauseating obsession with pleasing often out of touch and sometimes downright moronic hooligans who want tinted windows on their elevated luxury boxes so they can look down on the little people, who have little genuine regard for the values golf stands for, and who consistently display a disdain for anything beyond themselves.

U B What? Yet Another Significant PGA Tour Sponsor Up To No Good

AP's Curt Anderson explains how the IRS is claiming that UBS, sponsor of several events including The Players, Arnold Palmer Invitational and several other events around the globe, "created hundreds of sham offshore entities and lied to U.S. officials in an elaborate scheme to conceal the overseas accounts of wealthy Americans, the Internal Revenue Service claimed in federal court documents."

"How could anyone really take this outfit seriously?"

Tom Kirkendall offers a couple of interesting blog posts sharing the Houston perspective on Stanford Financial and on IMG's bad week.

"IMG is so deeply involved with Stanford that it has a one-man office in Memphis to assist with the local Tour stop."

Alex Miceli shares all sorts of fun tidbits about the Stanford situation, the PGA Tour and IMG. First, regarding the state of the Memphis stop:

The Tour could attempt to find another sponsor or draw upon its sizable financial reserves – about $200 million, sources said – to underwrite the event on its own.

There is a precedent for such intervention: In 2000, the first year of the Tampa Bay Classic, the Tour contributed a part of the $2.4 million purse.

It was unclear whether the Tour or the event has received any monies from Stanford for the 2009 sponsorship. Finchem would not discuss payment details, but sources familiar with sponsorship deals say such agreements typically are handled in one of two ways: a large, usually 50 percent payment up front, and the balance paid before the event week – or nearly a complete payment just weeks before the event.

“Payment schedules are a function of a lot of different things with companies,” Finchem said. “A lot of companies account differently; they want to pay differently. There is no rhyme or reason to it.”

And on IMG:

The firm manages the Stanford St. Jude Championship; and sponsorship contracts to IMG clients Villegas, Pressel and Singh. Stanford also is affiliated with IMG’s prized client, Tiger Woods, with a three-year founding sponsorship of AT&T National, a Tiger Woods Foundation event.

IMG is so deeply involved with Stanford that it has a one-man office in Memphis to assist with the local Tour stop.

"Since 1974, Ms Wade has benefited from financial advice from her management company, International Management Group"

A reader took exception to IMG's Mark Steinberg and insistence that IMG does not provide financial advice to its clients and therefore, could not have been intertwined with Stanford Financial, as the New York Post is claiming. I'm really not sure how the reader drew this conclusion because...wait, what was it that tennis great Virginia Wade said in a 2005 Telegraph story?

Since 1974, Ms Wade has benefited from financial advice from her management company, International Management Group "We are in touch regularly, maybe once a month. If you are interfering all the time it gets hard for them."

Hilariously, the article details how she owned a building with the late Mark McCormack, invested in a Cleveland based insurance company where IMG hapens to be located, and well, there's that quote. 

"IMG does not give investment advice to our clients...period."

Thanks to reader Andrew for this Darren Rovell story quoting Mark Steinberg on IMG's relationship with the troubled Stanford Financial.

"The suggestion conveniently made by "unnamed sources" about IMG's business affairs involving our clients in today's New York Post is complete fiction, designed to benefit the people making the claims, and is completely irresponsible.

"IMG's 50-year history of success is built upon staunchly protecting the professional interests of our clients. IMG does not give investment advice to our clients...period. Our agreement with Stanford is only to provide consulting services in the area of sponsorships and activation in golf. We do not now, nor have we ever had, a 'quid pro quo' agreement with Stanford or anyone else where IMG would be compensated in exchange for directing our clients to invest with them. We could not have maintained our near half century lead in the industry if we had done anything else. For 'unnamed sources" to imply otherwise is simply reprehensible."

Did IMG Steer Clients To Stanford Financial?

Thanks to reader Tuco for Peter Lauria and Kaja Whitehouse's New York Post story claiming that IMG directed its clients to Stanford Financial. IMG is vehemently denying...

According to three sources with knowledge of the situation, IMG and Stanford have a quid-pro-quo agreement under which Stanford Financial pays IMG a low- to mid-seven-figure consulting fee in exchange for IMG advising its clients - which include golfers Tiger Woods, Arnold Palmer, David Toms, Sergio Garcia and others - to have their money managed by Stanford.

The backroom bargaining has exposed IMG to charges of double-dealing, and is raising questions about where the firm's allegiances lay: with Stanford Financial or its athlete clients.

"It's certainly a conflict of interest," said one source. "IMG is trading on its athletes' names to make money for themselves and then turning around and telling them to invest money with Stanford."

PGA Tour Sponsors: "Three Camps"

I thought reader "Hitting Three" made some interesting observations (as did several others) on the original Stanford Financial post.  Hitting Three broke down PGA Tour sponsors into categories of financial well-being. In case you missed it:

PGA Tour sponsors, 3 camps:

Camp Solid: (24 events)
=======================
Mercedes...seem to be fine.
Sony...seem to be fine.
AT&T...seem to be fine.
Northern Trust...seem to be fine, for a bank anyway.
Accenture...seem to be fine.
Honda...seem to be fine.
Mastercard....debatable but AP can always rope in a new one.
Computer Associates...seem fine.
Transitions...ditto.
Shell...should be fine.
Master's...self-funding, what a concept!! (obviously not a PGA Tour event)
Verizon...seem to be fine.
Zurich...ditto.
Valero...stock went from $75 to $15, but otherwise fine?
HP...fine.
Travelers...ditto.
AT&T (2)...seem to be fine.
John Deere...stock from $90 to $30, but seem fiscally sound.
Royal Bank of Canada...prob be ok, but keep an eye on 'em.
Bridgestone...should be fine.
BMW...ditto.
Coca Cola...ditto. (it's "Co'cola" for the uninitiated)
Viking...men will always grill out.
Disney...guess there will always be a Disney tournament.

Camp Coin Flip: (8 events)
==========================
Mayakoba...luxury travel, who knows, unless it's a wash site then they are fine?
Crowne Plaza...hotel biz? has to be a questionmark.
Morgan Stanley...appears to have survived brush with death, but TARP limits them.
Wyndham...hotel biz? stock has gone from $37 to $4, I'd be worried.
Deutsche Bank...another bank, stock is down 75%, flip a coin.
Turning Stone...prob be ok, I guess.
Shriners...who is the sponsor?
Fry's...with the recent fraud who knows?

Band Camp: (10 events)
======================
Chrysler...life support, probably not a viable sponsor going forward.
FBR...stock traded at .22c today. Most .22c'rs don't make it.
Buick...ditto Chrysler.
Banco Popular...bank, stock down 75% in last 3 years, seems v shaky.
Wachovia...vaporized, acquiror has no interest in Tour.
Stanford...raided today by SEC for "massive on-going fraud".
US Bank...bailed on the sponsorship after '09.
Buick (2)...life support, brand may not even survive.
Legends..."a project that is currently on hold" -- doubt they are back for '10.
Barclays...stock down 87%, and it's a bank, Ty bulk up in legal!

- 56% of events appear to be on solid footing.
- 20% in coin flip territory.
- 24% looking like burnt toast.

Not a pretty picture... 02.17.2009 | Hitting Three