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Jimmy Haslam may be asked to step down while investigation continues

Apr 19, 2013 -- 7:32am

By Tony Grossi | ESPNCleveland.com

 

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Federal allegations of fraud made against Jimmy Haslam’s Pilot Flying J company may imperil his operational control of the Cleveland Browns, according to a source with knowledge of both the legal system and the inner workings of the NFL.

“This is worse than a dark cloud. This is a funnel cloud,” said the source.

Haslam was inside the Browns’ facility to sit in on draft meetings on Thursday when details of an alleged fraud scheme that enriched his family’s company were revealed in unsealed documents filed in U.S. District Court in Knoxville, TN.

The 120-page affidavit, as first reported by The Plain Dealer, summed up a two-year investigation of Haslam’s truck stop and travel center company by the FBI and IRS. The documents, which were used to obtain search and seizure warrants served Monday at company headquarters, charge that Haslam knew company sales executives withheld millions of dollars of rebates owed trucking companies that purchased gas in large volumes from Pilot Flying J.

After reading the documents, Haslam issued a statement that said in part, “I maintain that the foundation of this company is built on its integrity and that any willful wrongdoing by any employee of this company at any time is intolerable.”

Haslam pledged to continue to cooperate with the FBI investigation and also to continue his company’s internal investigation of the allegations.

The NFL has declined to comment.

The investigation has not resulted in an indictment.

The source believes the league may ask Haslam to step aside of his own volition and remove himself from operational control of the Browns while the investigation continues. It’s possible that requirement could result in Haslam staying away from the team facility.

If Haslam declined, the source said, the league could suspend Haslam until the investigation is completed.

Former NFL Commissioner Paul Tagliabue suspended former San Francisco 49ers owner Eddie DeBartolo Jr. for the 1999 season after DeBartolo pled to failing to report an alleged extortion plot involving the licensing of a Louisiana riverboat casino.

DeBartolo also was fined $1 million by the league. He eventually ceded control of the franchise to his sister, Denise DeBartolo York.

The source believes that it may be in Haslam’s best interest to appoint a family member “who can’t be touched” by the federal investigation of Pilot Flying J to oversee operations of the Browns.

It’s unclear what action the NFL might take if Haslam himself were charged and convicted of a crime. Forcing a sale would be unprecedented.

“They can force him, probably, to transfer his interests to another entity within the family, where he may still have equity holdings but absolutely no involvement in operations,” the source said. “They can remove him from having front-and-center involvement.”

The source believes that alone would be a huge psychological blow to the Browns franchise.

“The club was going to build off the energy of Jimmy Haslam, and the success of his company. This was going to be the foundation for the whole franchise and all the energy stemmed from that,” said the source.

Tony Grossi covers the Browns for ESPN 850 WKNR, ESPN 1540 KNR2 and www.espncleveland.com.

He has covered the Browns with distinction since 1984 and is one of 46 voters for the National Football League Hall of Fame. Email your “Hey Tony” questions to tgrossi@espncleveland.com

Follow Tony on Twitter @tonygrossi

 

 

 

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