AMERICAN FORK — The leader of an American Fork-based youth fitness charity has been fired from his post for allegedly spending $5 million of the nonprofit organization's money for personal expenses.
The National School Fitness Foundation said Thursday in a statement that its board of directors voted May 31 to remove Cameron J. Lewis as president.
Board members made the decision to terminate Lewis after an independent auditor reviewed the foundation's records and found major financial discrepancies.
The foundation also filed a 31-page complaint Wednesday in U.S. Bankruptcy Court that says Lewis used money from the charity to buy himself a small airplane and finish a $500,000 Highland home.
Lewis, who created the foundation in 2000, is also accused of billing the charity $5,000 for scuba-diving training, $8,000 for an elk hunt and tens of thousands of dollars for political donations.
"Cameron Lewis focused his efforts on a pattern of self-dealing and deception that not only lined his pockets but crippled NSFF in its efforts to raise funds from private donations and government grants," the complaint says.
Among other things, the complaint accuses Cameron Lewis and his father, Tyron Lewis, of transferring $2 million in charity assets to trust accounts controlled by them.
Attempts to reach Lewis for comment have been unsuccessful.
Tyson Lewis resigned from his post as chairman of the foundation's board following his son's removal from his job. Tyson Lewis had been operating as the sole board member for several weeks prior to his resignation, according to the foundation.
The past chairman of the board, Martin Arnoldini, resigned in April after it was learned he had been convicted of a felony for his part in a scheme to avoid paying taxes. Two other board members resigned shortly thereafter.
New board members — so far it is made up of only two people — faced scandal soon after assuming their duties. They cast the votes to terminate Lewis.
Speculation about the foundation's finances have swirled since Lewis last month told schools in 20 states it could no longer help pay for fitness equipment the schools received through the charity. The equipment was supposed to be free.
Originally, the fitness foundation told the 600 schools it would reimburse the costs of purchasing a full set of exercise equipment by raising donations and seeking federal grants, which would be distributed monthly among the participating schools.
But only $38 million of the $77.5 million price tag for all the equipment was ever paid back, prompting an investigation by Minnesota Attorney General Mike Hatch, who declared the foundation a Ponzi scheme that used money from newly enlisted schools to pay back the schools that signed up first.
Cameron Lewis, however, blamed Hatch for the lack of donors. Hatch's investigation, he said, discouraged potential donors, forcing the foundation to file for Chapter 11 bankruptcy two weeks ago.
The foundation's new president is Jeffery M. Peterson, former chief operating officers for the foundation.
As part of his plans to restructure the foundation, Peterson has laid off half of the foundation's remaining staff. Many had quit because of ongoing financial problems. In fact, all foundation employees have not been paid since mid-May.
"Many sincerely good, hard-working people have worked at the foundation, who honestly hoped to help schools and fight the devastating effects of obesity rampant among our young people today," Peterson said.
To help save the foundation, Peterson said he will conduct an internal audit, make revisions to the foundation's business plan and seek additional board members.
"We still want to raise millions for schools," he said. "Although much of the foundation's literature states that the foundation cannot guarantee to raise all of the money, we are committed to raising as much of it as possible."
Contributing: Associated Press; E-mail: lwarner@desnews.com