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Report: Investigators tailed Libman before resignation

August 9, 2011

The city of Carmel hired private investigators to tail Steven Libman, the former CEO of the Center for the Performing Arts in Carmel, because of concerns of possible misuse of city funds, sexual harassment and sexual intimidation, Fox59 is reporting.

The station, IBJ's news-gathering partner, said invoices for more than $8,000 of surveillance by private investigators were filed with the city in July, the second of them less than two weeks before Libman abruptly resigned on July 29.

Citing undisclosed personal reasons, Libman stepped down less than three months after his contract had been extended through 2016. A voicemail message left for Libman on Tuesday morning was not immediately returned.

According to e-mails obtained by WXIN-TV Channel 59, Carmel Mayor Jim Brainard told Carmel city councilors that “individuals came to us—concerned that city funds were misused. It was of great concern that foundation funds were at risk … as well as sexual harassment and sexual intimidation. … [The] police chief was informed … but not requested to investigate."

Instead, city attorney Douglas Haney hired Indianapolis-based International Investigators Inc., according to invoices signed by Haney. The invoices have the name of the target of the investigation redacted, but Fox59 cited a source close to the probe who said Libman was the target.

Haney, who was appointed by Brainard, is also a member of the board of the Center for the Performing Arts. The $175 million complex kicked off the inaugural season of its largest theater, the Palladium, in January.

A call to Haney’s office was not immediately returned Tuesday morning. A call to Brainard was referred to Carmel’s community relations department, which did not respond immediately.

According to the e-mails cited by Fox59, Brainard told city councilors, "The city attorney conducted his own investigation because he needed to prove or disprove these serious concerns that put the city at risk."

Libman, who took the helm of the center in September 2009, was paid $200,000 in his first year as CEO. The Palladium hosted 24 shows in its inaugural season, selling about 96 percent of available seats and grossing $1.67 million in revenue.

Since Libman’s departure, Frank Basile, a center board member, has been serving as interim CEO. Basile told IBJ  in late July that the board plans to use the same search committee that found Libman two years ago. He said he hoped the search would last just a few months.

Reached by phone Tuesday morning, Basile said he had just had a meeting discussing the investigation and what information had gone out about Libman. However, he declined to comment beyond an Aug. 1 statement he gave to stakeholders of the center, acknowledging that there were many questions about Libman’s resignation. He asked for understanding about the need to respect an employee’s privacy.

"I’m sure you can appreciate that I will not satisfy everyone’s curiosity," Basile wrote, adding, “As is common when any organization is faced with an unexpected executive-level resignation, I have started a review of all internal operations at the Center. As the interim President/CEO, my goal is to maintain a smooth transition for the day-to-day operations.”

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