The state has agreed to accept $175,000 from an insurance company to settle a lawsuit against a charitable organization accused of misspending money.
Indiana Attorney General Steve Carter announced this week that the state agreed to accept the money to settle a lawsuit against former board members of the Olin B. and Desta Schwab Foundation. None of the money will come from the board members themselves.
Carter said the payment puts to rest a lawsuit he filed against the non-profit’s board in December 2005, four months after it was revealed the foundation had moved to Nevada and paid for a $1.5 million vacation home in a gated resort outside Las Vegas.
The settlement will be paid by Chubb, the company that insured the foundation against losses caused by its officers. The former board members and then-president Richard Blaich’s estate will not pay anything.
“These individuals have paid a price in terms of their reputation in the community,” Carter said.
Attorney Bruce Boxberger said former board members Charles Conville, John Dortch and Jon Garver did nothing wrong and that a statement later will state that.
“There’s a cost to the extent you read your name in the newspaper and there’s allegations of things you didn’t do,” Boxberger said. “They’re certainly happy to put this behind them.”
The foundation was formed in 1989 by widower Olin Schwab, who died in 1991, to help area students choose careers.
Carter, who had sought to recover $400,000 in alleged misspending, said the $175,000 settlement was reasonable, as court action might have taken years and not resulted in much more money.
The settlement does not contain a statement saying it should not be construed as an admission of wrongdoing by the former board members.
The lawsuit 14 months ago removed Blaich, Garver and Dortch from the board and also named Conville, who was a board member at the time many of the decisions were made but later replaced by Garver.
Since Carter’s suit was filed, an interim board has replaced all former members, the house in Nevada has been sold, and the process of moving the foundation back to Indiana is nearly complete. The interim board gave more than $235,000 in grants last June.
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