1989 | Disclosure of improper payouts led AMA to limit chief executive's financial powers
In 1989, reporters Howard Wolinsky and Tom Brune exposed that an American Medical Association executive, Whalen Strobhar, pocketed more than $350,000 in "inappropriate" reimbursements for his losses in the 1987 stock market crash.
Wolinsky and Brune found that Strobhar lost about $348,000 when the stock market plunged Oct. 19, 1987, but two days later, the AMA repaid him $353,000. AMA President James Sammons approved the payment.
The reporters also discovered that Sammons, in 1985, approved $267,000 for a condo loan for another AMA executive that ended in foreclosure.
As result of the stories, Strobhar resigned and said he would repay the AMA with interest. Sammons apologized for approving the transactions and retired. And the AMA reorganized to take away the chief executive officer's "broad financial discretion."