Top OLCC officials kept popular booze – including Pappy Van Winkle – for themselves, diverting it from public
Feb. 8, 2023 Updated Wed., Feb. 8, 2023 at 3:22 p.m.
Oregon Liquor and Cannabis Commission employees, including top-level managers and the agency’s longtime executive director, have for years set aside for their own use some of the most sought-after bourbons, diverting them from the public and running afoul of state ethics laws.
The blockbuster findings, detailed in public records obtained Wednesday by The Oregonian/OregonLive, reveal a longstanding practice within the agency of reserving bottles of the popular bourbon, Pappy Van Winkle, for multiple employees, including the recently ousted executive director, Steve Marks, and his second-in-command, Will Higlin.
Four other managers were named in the investigation as having requested bottles be set aside for them, including Bill Schuette, the budget manager, Chris Mayton, the director of the distilled spirits program, Boba Subasic, the chief information officer and Kai Nakashima, director of the office of information services. All were reprimanded, according to agency records.
The scheme came to light last April when a departing agency employee documented his concern in an email to agency staff, saying the state warehouse supervisor set aside bottles of bourbon “and has them sent to stores so higher ups” can pick them up. The complaint prompted an internal investigation, which found the practice was widespread and included Marks.
Nikki Leslie, who manages the agency’s liquor distribution center, said the bourbons — which fetch top dollar on the secondary, or illegal, liquor market — had been diverted for at least eight years and involved brands with cult-like followings among connoisseurs, such as Elmer T. Lee and the whole line of Pappy Van Winkle bourbons, from the 10-year to the 23-year bottles. In an interview with Travis Hampton, a retired Oregon State Police superintendent who works in the liquor agency’s human resources division, Leslie said the employees who requested bottles of bourbon paid for them.
Leslie told Hampton that Mayton asked her to set aside Elmer T. Lee, a bourbon produced by the same Kentucky distillery that makes Pappy Van Winkle bourbons, on two occasions and told her to have it delivered to a Milwaukie liquor store.
Leslie said the diverted booze was part of the state’s “safety stock,” essentially bottles that serve as potential replacements for damaged liquor headed to the liquor stores. She could not say how many bottles were held back at the request of agency employees.
On Wednesday, Gov. Tina Kotek sent a letter to the members of the Oregon Liquor and Cannabis Commission who oversee the agency, saying she became aware of the investigation after she asked Marks to step down.
“This behavior is wholly unacceptable,” she wrote. “I will not tolerate wrongful violations of our government ethics laws.”
She urged the commission to “install new leadership and remove the managers and executive leadership who have taken advantage of their access and authority to benefit themselves” and she said she asked the attorney general to carry out an independent civil investigation “to look into the extent of any wrongdoing and recommend stronger protocols for ensuring ethics laws are followed by OLCC.”
Marks was reprimanded late last year for using his position to obtain the scarce bourbon. An internal investigation found he had violated numerous state policies, including ethics rules that prohibit public officials from using their positions for personal gain.
“Several agency executive managers were interviewed regarding the subsequent investigation into this matter and some implicated Executive Director Marks in the tacit approval of their actions and also engaged in the practice themselves,” Rich Evans, a retired Oregon State Police superintendent who directs the liquor agency’s licensing and compliance division, wrote in a memo in December.
During the investigation, Marks admitted he had asked the warehouse manager to “divert warehoused liquor for his personal use” multiple times, recalling that he had specifically sought Pappy Van Winkle’s 23-year-old whiskey – liquor that’s produced in limited quantities and released once a year.
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