LGBTQ South Florida

World OutGames Miami audit shows shoddy accounting and big consulting fees

World OutGames sporting events canceled amid financial turmoil

The 10-day event scheduled for venues in Miami and Miami Beach is unraveling due to financial problems.
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The 10-day event scheduled for venues in Miami and Miami Beach is unraveling due to financial problems.

Update: Miami Beach police have determined there was no “malicious intent” on the part of OutGames organizers, so no criminal charges will be filed. Read more here.

Organizers of the ill-fated World OutGames Miami kept shoddy financial records, grossly overestimated fundraising and spent more than $600,000 — almost half the revenues — on consulting, advertising and promotional fees for sporting events that were canceled on opening day, according to details released Tuesday in a Miami Beach audit.

A summary of the audit’s findings was sent to Beach commissioners Tuesday afternoon. The document details failed fundraising, poor record-keeping and virtually no oversight for a Memorial Day week of events that was supposed to showcase LGBTQ athletes from around the world. Many athletes left South Florida angry and disappointed by the OutGames, some of which were organized at the last minute when the main program went bust.

In the end, the OutGames, which were to debut in the United States, came about $1 million short of a $2.36 million budget that had been trimmed repeatedly. The city lost $200,000 on the project, funds provided to OutGames as seed money.

Organizers spent nearly all of the $1.4 million deposited in the organization’s accounts, with only about $7,000 left — and a few hundred thousand dollars still owed to hotels and other creditors.

OutGames CEO Ivan Cano walked away with $106,992 in consulting fees for his work, according to the audit. The chief operating officer, Keith Hart, ran up a $94,000 American Express tab on his personal account to pay some of the bills. Both Cano and Hart did not return text or voicemail messages.

Beginning in 2015, contractor Lynare Robbins received $69,400 to produce a human rights conference and contractor Carol Coombes got $57,344 to produce cultural programs. Both the human rights conference and the cultural events successfully went on as planned.

Overall, OutGames organizers spent $330,218 on consulting fees and $296,498 on advertising and promotion, according to the audit.

Several companies previously owned by Miami Beach LGBTQ activist Justin Bell were paid $140,337 for advertising and promotion. The money went to a “complete rebranding” of World OutGames and a creative retainer including payments to a graphic designer, social media manager and a copywriter, Bell told the Miami Herald.

Then, in October 2015, “we fired them as a client” because they were more than 200 days behind on payments, Bell said.

In addition, OutGames lost more than $90,000 on nonrefundable deposits for Marlins Park stadium and The Fillmore Miami Beach, venues leased for events and activities that were canceled. Organizers spent $106,345 on marketing trips across the U.S. and abroad to Europe and Latin America.

Only $65,475 was spent on sporting events.

Large bills remain unpaid, including Beach hotel charges passed on to stunned athletes who returned to homes as far away as Australia.

Miami Beach auditors spent a few months combing through the OutGames books, which were not kept well, according to the city.

“In reviewing these documents, it became apparent that the general ledger was not necessarily accurate as it was found to contain incorrect check numbers and disbursement classification errors,’’ according to the audit report. “Compounding matters was the lack of sufficient, complete and organized documentation.’’

Marketed for years as an LGBTQ-themed event that would include a spectacular gathering of athletes, celebrities and cultural figures, World OutGames Miami turned into a major debacle when it unraveled May 26, less than 24 hours before the opening ceremonies.

Athletes, who paid nearly $500,000 in registration fees to OutGames, arrived to find that all but a few sporting competitions were canceled because of the financial problems. The confused and underprepared leadership team, helmed by Cano, disbanded in the days and weeks after the 26th.

City auditors gave their findings to Miami Beach police and the Miami-Dade State Attorney’s Office to determine if charges should be filed.

Said police spokesman Ernesto Rodriguez: At this point, “no charges have been filed.”

Joey Flechas: 305-376-3602, @joeflech; Steve Rothaus: 305-376-3770, @SteveRothaus