Film Charity Pulls Out as Beneficiary of Gala

A long-running Oscar-night charity gala suffered a blow last week when movie director Martin Scorsese’s Film Foundation abruptly pulled out as the beneficiary after being questioned about the event by California law enforcement officials.

The “Night of 100 Stars,” in its 14th year, is set for Feb. 29 at the Beverly Hills Hotel. The black-tie gala, organized by former sports agent Norby Walters, has become a popular stop for second-tier celebrities.

A spokeswoman for the Scorsese foundation declined to give a reason for its withdrawal from the gala after six years of involvement but said foundation officials had recently been questioned about the event by representatives of the California attorney general’s office, which oversees fundraising in the state. The spokeswoman said the foundation had only recently learned details of the benefit’s finances.

A spokesman for Atty. Gen. Bill Lockyer said Sunday that the office was “reviewing the event” but wouldn’t elaborate.

Since 1998, the “Night of 100 Stars” has raised a total of about $400,000 for the Film Foundation, a New York-based philanthropy headed by Scorsese and a board that includes Steven Spielberg, George Lucas, Francis Ford Coppola, Sydney Pollack, Robert Redford and others. Past attendees at the Academy Awards-night event have included Judd Nelson, Tom Arnold, Harry Hamlin, Bridget Fonda, David Hasselhoff and Anna Nicole Smith.

Walters said Sunday that he planned to go forward with “Night of 100 Stars” as a private party, with no money going to charity.

“The show goes on,” he said. “I’m going to invite everybody for free. This is my party for 150 actors.”

Walters said the Film Foundation, dedicated to film preservation and artists’ rights, hadn’t explained why it had decided to stop participating. “I can’t figure it out,” he said. The promoter said foundation officials had recently asked him for financial details but said he wasn’t aware of the state probe.

Scorsese is named on a solicitation card for the $1,000-per-ticket event and was prominently featured on its website until last week. The foundation spokeswoman, who stressed that the foundation itself wasn’t the subject of any of the questions by state officials, said it appeared that neither Scorsese nor any of the foundation’s directors had ever attended the event.

According to the spokeswoman, Walters had recently informed the group that he compensated himself by keeping the difference between what it costs to put the benefit on and the payments he receives from the event’s underwriters, with the foundation getting proceeds from ticket sales.

This year’s solicitation card identifies the underwriters as Chicago-based Driehaus Capital Management Inc. and Valencia-based DVD maker Future Media Productions Inc. Walters estimated their total contribution this year at $150,000.

In financial statements filed with the city of Beverly Hills, Walters reported paying himself a fee of $10,000 in 2002; a similar fee was recorded for an unnamed person on last year’s statement.

Lockyer’s spokesman said Walters hadn’t registered with the state as a fundraiser for hire, but declined to say whether officials believed he was obligated to do so. State law generally requires those who raise charitable funds for compensation to register and file reports with the attorney general.

A review of financial statements filed by Walters with the city of Beverly Hills shows that in past years, as many as 90% of the gala’s guests have attended for free. In 2000, for instance, Walters gave 400 complimentary tickets to actors and their guests and 80 to the press. Just 72 people paid the average ticket price of $650, yielding a relatively modest $47,000 in donations.

Hollywood philanthropy has come under increased scrutiny in the last year after state and federal officials filed a civil complaint and criminal charges against charity promoter Aaron Tonken.

Tonken pleaded guilty in December to defrauding charities and is awaiting sentencing.

Lockyer has said he planned to propose an overhaul of state laws governing charity events, hoping to curb gifts to stars and other practices that surfaced in the Tonken investigation.

A onetime friend of Tonken’s, Walters sometimes assisted Tonken -- and occasionally lectured him on the uses of star power. “You, better than anyone understand the power of stars & celebrities,” Walters once counseled Tonken in a nine-page, handwritten memo. “Whether you net $100,000 or $1 million, YOUR party is YOUR party.”

Speaking on Sunday, Walters acknowledged making a modest profit from his own annual gala in most years.

“I don’t have a problem being compensated,” Walters said. “The money that goes to me is whatever might be left over. From $8,000 to $14,000.”

Walters confirmed that he wasn’t registered with the state as a charitable fundraiser, but said he filed annual financial statements with the city of Beverly Hills.

After last year’s party, Scorsese personally thanked Walters for his long support of the foundation. In an April 1 letter, the filmmaker wrote of the previous month’s gala, which yielded more than $140,000 in donations: “I heard it was a wonderful event and was astounded to hear how much money you raised.”

In a brief letter faxed to Walters on Friday evening, foundation Executive Director Margaret Bodde said, “After careful consideration, the Film Foundation has decided not to be a beneficiary from this year’s Night of 100 Stars.” The letter asked Walters to stop using its name on invitations and other promotional materials.

On Sunday, Walters said he would ask the foundation to return to buyers of tickets for this year’s event about $10,000 he had already sent to the foundation, and that he planned to return to donors $13,000 in checks that he hadn’t yet forwarded.

Walters, 71, was one of two figures embroiled in a major college sports scandal in the late 1980s. He was convicted in 1989 of mail fraud and racketeering, and sentenced to five years in prison. But the conviction was reversed on appeal and he served no prison time.

Authorities had alleged that he secretly signed dozens of college athletes to contracts before their college eligibility was up with the National Collegiate Athletic Assn. It also alleged that he and partner Lloyd Bloom used money and threats of violence to keep athletes in their fold.

“It was all tossed,” Walters said Sunday of the case against him. Bloom, whose convictions also were overturned, was found shot to death in his Malibu home in 1993.

The Film Foundation spokeswoman said the organization became involved with the “Night of 100 Stars” when Walters called and offered to make the foundation the evening’s primary beneficiary.

The spokeswoman said Walters handled the event arrangements and ticket sales and the foundation’s involvement was limited to receiving funds from ticket sales.

Attempts to reach Scorsese on Sunday weren’t successful.

A current listing in the Los Angeles Master Planner, a trade publication for event organizers, lists the “100 Stars” event as “Honoring Martin Scorsese.” But the foundation spokeswoman said the event never had an honoree during the years of the group’s involvement.

A spokesman for Richard H. Driehaus, founder of Driehaus Capital, said the financier had committed $75,000 to the event. “Richard is very well known for his philanthropic efforts, and this is very much in keeping with his support of the arts, in view of the event’s connection with the Oscars,” the spokesman said in an interview before the Scorsese group pulled out.

Future Media President Alex Sandel, also reached before the Film Foundation’s withdrawal, declined to discuss his company’s contribution. Neither the Driehaus spokesman nor Sandel could be reached over the weekend.

Walters said Sandel had assured him he would continue to underwrite the event, and he believed Driehaus would do the same.

Players on Hollywood’s charity scene said they were surprised at the high number of free tickets doled out for the “100 Stars” event. Alexandra Grane, spokeswoman for the Elton John AIDS Foundation, said that that charity does not give away any tickets to its annual Oscar night fundraiser, which similarly attracts a large roster of stars for an awards viewing party.

At last year’s “100 Stars” gala, two-thirds of the evening’s 575 guests received free tickets, according to a financial statement filed by Walters with Beverly Hills.

In 2002, according to a city filing, 75% of the gala’s 600 guests attended for free, while ticket sales to the rest yielded $112,500 for the foundation.

A representative of the Beverly Hills Police Department’s Solicitations Advisory Commission said it didn’t have any record of a permit application or financial statement from Walters for the 2001 gala.