The Oregon Department of Justice announced a settlement Wednesday with the former director of the Portland Marathon.
Lester Smith must pay $865,000, including $50,000 for the state’s investigative costs.
Smith admitted no wrong doing, according to the settlement agreement.
The Oregon Justice Department said in a release that Smith broke the law by loaning himself and his related companies hundreds of thousands of dollars from the marathon over the course of several years. The DOJ also said the Portland Marathon operated for years without meaningful oversight from its board.
“I am pleased that we were able to work with the new board of the marathon to evaluate the organization’s financial situation and ultimately assist in recovering substantial funds owed to the marathon by Lester Smith,” Oregon Attorney General Ellen Rosenblum said in a statement.
Smith’s business partner, Mamie Wheeler, is referenced in the settlement agreement. A spokeswoman for the DOJ said Wednesday that the agency is still investigating Wheeler.
As part of the settlement, Smith is prohibited from running any charitable organization. He also has to dissolve Next Events, his for-profit company. Smith is prohibited from trying to be reinstated with the Oregon State Bar and is barred from any involvement in future foot races.
“The Portland Marathon is a capstone event in Oregon, and I am hopeful that this settlement will enable more successful events in the future,” Rosenblum’s statement said.
In a statement, Smith’s attorney, Janet Hoffman, said her client admitted no wrong doing.
“We are glad that we were able to reach this resolution with mutual releases between The Portland Marathon, it’s board and the Smiths,” Hoffman wrote in an email. “Mr. Smith hopes there will be a successful 2018 Portland Marathon without distraction.”
Disclosure: Hoffman is an OPB underwriter.