Oregon Attorney General Ellen Rosenblum announced today that the Oregon Department of Justice (DOJ) and the Portland Marathon have reached an $865,000 settlement with Lester Smith, former board member and Race Director of the Portland Marathon.
The settlement requires Mr. Smith to pay the Portland Marathon $865,000, of which $50,000 will be paid to DOJ to reimburse for investigative costs. Under the settlement Mr. Smith is prohibited from serving as a director, officer, or fiduciary of any charitable organization, and requires him to dissolve his for-profit company Next Events, LLC. In addition, he is not able to operate, or be involved with, any foot races in the future, and he is prohibited from seeking reinstatement with the Oregon State Bar.
“Our Charities Section supervises and regulates over 21,000 registered charities in Oregon; this means we have an obligation to make sure each one is run with integrity and in accordance with Oregon charities laws,” said AG Rosenblum. “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.”
The Oregon DOJ investigation found that Mr. Smith operated the Marathon for many years without meaningful board oversight. Records revealed that over the years Mr. Smith, or his related companies, received hundreds of thousands of dollars in loans from the Marathon—a practice that is illegal.
“The Portland Marathon is a capstone event in Oregon, and I am hopeful that this settlement will enable more successful events in the future,” said Attorney General Rosenblum.
The Oregon Department of Justice’s Charitable Activities Section supervises and regulates the activities of more than 21,000 charitable organizations in the state. To review financial information of all registered charities in Oregon, visit our database.