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September 7, 2016 at 8:26 pm
Filed Under -:Grand Prix of Boston, Mike Macklin
BOSTON (CBS) — A local man now owns a piece of failed Boston history. Two cars from the
Grand Prix of Boston, an IndyCar race that never happened, sold at a court ordered bankruptcy
auction in Holbrook Wednesday.
The race was supposed to draw thousands of spectators to the Seaport over Labor Day weekend,
but snags in the permit process and outrage from residents put a wrench in the plans.
Organizers were forced to auction off replica cars and road barriers that would have been used
for the race. More than 1,100 concrete barriers went up for auction.
One of the promotional replica cars was bought by Mark Blower for $7,000. "It's just like when
little boys like Matchbox cars, as you get older, you like bigger cars," Blower said. "That's it, so
it's just a model, it's just a fun little, there's no particular reason why I bought it."
Blower said he would have put an engine in the car and tried to run it, but he doesn't think that
can be done.
The auction raised about $25,000, a drop in the bucket for race organizers who are $9 million in
debt with $1.6 million owed to ticket -holders.
Following the lead of the Miami Grand Prix, the Grand Prix of Palm Beach will seek about $1
million from the state Legislature to buy grandstands, barriers and communications gear. The
equipment, bleachers and concrete walls would be owned by the county, but be used by the
race promoters for a month for the June 20-21 race, said John Sansbury, one of the investors in
Grand Prix Promotions Inc. The public will benefit, Sansbury said, because the race generates
business. The first Grand Prix injected $10 million to $12 million into the local economy, tourism
officials have estimated. He said the barriers cost $465,000 and the radio equipment $49,000.
Bleachers may cost as much as $500,000, he said. The county could lease the barri er walls to
contractors for use dur' ing road construction, use the radi ' os during hurricanes and other
emergencies and move the bleach; ers to Okeeheelee Park for the nar tional water skiing
tournament and -to other county parks. c i "This is nothing new. Ralph (Sad -chez) got a grant of
$500,000 each: year for four years. We would go' with a one-time grant," Sansbury said. "If
Ralph can do it, we can do, it." The grant would come from the state Department of Commerce.
Sansbury said he will present the', plan to the Palm Beach Courfty Legislative Delegation Feb.
27, the same weekend as the Miami Grand Prix. The paid attendance for the first. Grand Prix
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was about 60,000, al-: though officials estimated 80,000: attended. Promoters still owe the City
of West Palm Beach $19,00" for cleanup and have agreed to pay it by May
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Boston Grand Prix questionable spending exposed
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Karen Anderson & Jonathan Wells
BOSTON —
As lawyers comb through the rubble of the Boston IndyCar race that never happened, 5
Investigates has learned exclusive new details about how the millions of dollars raised to put on
the race virtually disappeared.
We were the only reporters in bankruptcy court for three days of hearings that laid bare the inner
workings of the failed IndyCar extravaganza.
It was going to be an event never before seen in Boston — a live IndyCar race right in the middle
of the Seaport District over Labor Day Weekend.
But Boston Grand Prix crashed and burned last spring, and now CEO John Casey is forced to
explain in U.S. Bankruptcy Court what happened to all the money raised to put the race on.
"I poured my heart and soul into this," Casey told 5 Investigates.But that's not all he did.
In three days of testimony, Casey described a company spending millions with little or no
oversight or traditional accounting, involving large sums of money raised from investors,
sponsors and ticket buyers.
By the time the race was abruptly canceled last spring, the company had virtually nothing left in
its bank accounts.
So where did all the money go?Records show the company spent nearly $20,000 on luxury boxes
at the Boston Garden for a Bruins game and a Bruce Springsteen concert, as well as money for
junkets to Indy races in California and Florida.
"I wasn't paid that much money," Casey told 5 Investigates back in June, but under oath before
the bankruptcy trustees' attorney, he said he paid himself more than $608,166 and claimed he is
still owed another $377,834.
.john Casey
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That would amount to nearly $1 million in compensation for Casey for over 18 months.
Casey also testified he regularly paid his own personal bills out of company bank
accounts,including $8,200 dollars for his personal home mortgage and a legal bill paid on his
behalf to a lawyer in Utah.
Boston Grand Prix also paid for Casey's Porsche. which he is still driving, $6,000 for two
business suits and $2,500 for a Boston College Club membership.
The company even paid off a debt for one of Casey's other businesses, Laser Leasing, which had
nothing to do with the race.
lie claimed in testimony that these and other payments on his behalf were actually part of his
compensation.
According to Casey, Boston Grand Prix had also paid personal bills for his predecessor, former
race CEO Mark Perrone, including his back taxes and payments on a Mercedes.
Other information revealed in the bankruptcy hearings included a $200,000 gift letter from
Boston Grand Prix to one of its female employees.
A gift letter is exactly that — a gift, not a loan — typically used in the purchase of real estate.
When asked about the gift letter by the trustee's attorney, Casey said, "I have never seen this
before in my life," but testified the employee who received it is "a cousin of an old girlfriend."
Casey also revealed Boston Grand Prix withheld taxes from its employees' paychecks, but never
paid that money to the state and federal government.
And that brings us to Casey's accounting. the sum total of which was just one seven -page
spreadsheet, obtained by 5 Investigates, with none of the transactions dated.
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That led to these questions from the bankruptcy trustee's attorney.
Attorney: ""there were no other books and records that Boston Grand Prix kept for the
company?"
Casey: "No."
Attorney: "Did you keep a log of invoices that came in?"
Casey: "No, I did not."
Attorney: "So you kept a list of accounts payable in your head?"
Casey: "Yes.'"
"It's extremely unusual for a chief financial officer that's got cash flow in and out of millions of
dollars to not keep books and records," said attorney David Lurie, who represents the Coalition
Against IndyCar Boston.
Asked what went through his mind as he listened to three days of Casey's testimony, Lurie said,
"What a sham. What an utter sham that this money was used for personal purposes and nobody
was watching it. Nobody at Boston Grand Prix. Nobody at the city. Nobody at the state level and
it was truly a house of cards."
Questions in the hearing also put a spotlight on individuals who had been paid by the race
promoters specifically to gain access to Boston Mayor Marty Walsh.
The focus was on two men – Dan Passacantilli and Chris Keohan – who own consulting firms
and who both had access to the mayor.
According to Casey, Boston Grand Prix paid them to, among other things, secure the support of
Walsh for the Ind -,Car race.
Casey testified in the bankruptcy hearing that Keohan and Passacantilli were given ownership
shares in the race and paid because organizers believed they could get themayor's ear.
Casey said Passacantilli was paid $42"000 to lobby the mayor's office.
The bankruptcy trustee's attorney questioning Casey asked, "Why was he chosen for the
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Casey answered, "Because his brother is the mayor's advisor."
His brother is Stephen Passacantilli, who at the time was an advisor to Walsh and who later
landed another city job, as a director of operations at the Boston Transportation Department.
But the mayor's office claims Stephen Passacantilli had no involvement with Boston Grand Prix.
Chris Keohan, a registered lobbyist, owns CK Strategies, which Casey said was given a 3 percent
ownership stake in Boston Grand Prix and paid $137.000 for lobbying, public relations and
community outreach.
Under questioning by the attorney for the bankruptcy trustee, Casey testified that "the conduit
between myself and the mayor has always been Chris Keohan."
Attorney: "What connection does he have to the mayor?
Casey: -I believe he ran the mayor's campaign."
Keohan told 5 Investigates his company is "retained by clients because of the quality of services
..." and "Those factors go far beyond our network of fonner clients and include strong
relationships statewide."
Keohan also said Casey had no part in their hiring because he was not yet part of Boston Grand
Prix.
Attorney David Lurie still has concerns.
"Lobbyists were hired -- people who were friendly with the mayor, who had previously worked
for the mayor -- and John Casey testified they were his conduit to the mayor," Lurie said. "It
turns out some of them actually had ownership interests in the race that were not publicly
disclosed."
We asked Lurie why people should be bothered that Passacantilli and Keohan did not disclose
their ownership stakes in the race.
'It's not the sort of transparent government that you want to see happen, Lurie said.
We asked Walsh if Boston Grand Prix was able to buy access to his office.
"Boston Grand Prix failed. It didn't happen," Walsh said. "So I don't know what kind of access it
is.'"
The mayor said the only lack of transparency was with John Casey himself.
"I give no one special treatment, and I certainly wasn't going to give consultants to BGP special
treatment," he said.
The mayor also said he is glad details are coming out on how Boston Grand Prix was operated.
There is no indication of any wrongdoing with how the consultants were paid.
We could not reach Dan Passacantilli for comment.
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