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Nobody outside what DAV calls its "inner circle" of leaders could justify the decision. National inspector general Gushee had called the St. Louis thrift stores the lifeblood of the chapter. Four months after the trustees took over, national commander Michael Dobmeier had issued a memo to local members and employees announcing that sales had increased by $32,000; the number of customers had increased; they'd saved $225,000 by reorganizing staff; and enhanced benefits had improved morale.
Overall income from the stores was $3.9 million in 1998. Despite the chaos of transition, it was $3 million in 2000.
To this day, Bay can't figure out why the chapter had to be declared bankrupt. Publicly, national said the trustees had failed to turn the stores around -- a sharp contradiction of their earlier internal memo. Bay knew this: Not only had the stores' bottom line improved, outside experts had agreed they would continue to clear $250,000 to $300,000 a year.
Bay thought about national's decision until his stomach felt like a rag soaked in acid, twisted and wrung out hard. If they were trying to save money, why had they directed the local chapter to continue paying the mortgage on Lemmons, even though it was titled in the name of the Hall? If they were worried about the lawsuits, declaring the local chapter bankrupt wouldn't exempt them anyway. And if the problem was the capsized pension fund, why not just reorganize and let the federal Pension Benefit Guaranty Corp. that insured the fund reimburse the employees?
Maybe national just thought it would be simpler to shut down the internal investigation, dissolve all business operations and let a bankruptcy trustee clean up the mess.
Either that, or they were desperate to avoid more exposure and publicity.
It had been a rough decade: The national DAV made the Washington Post in 1993, when they kicked out their adjutant commander for misuse of funds, and again in 1996, when they were sued for abolishing a director's job because he made waves about improper spending. In 1997, the treasurer of a chapter in Danville, Illinois, was indicted on charges of stealing more than $10,000 from the group; he'd come under scrutiny after the local hall burned in a suspicious fire. In 2000, national closed a clubhouse in Biddeford, Maine, revoked the chapter's charter and confiscated the chapter's savings, hoping to end allegations of illegal gambling and vanished money.
Here in St. Louis, depositions filed in a 1990 lawsuit revealed that one of Pealer's predecessors at the thrift stores had a criminal record, ran a gun business and gave thrift-store merchandise to cops as repayment for favors. Depositions also described how this manager used a separate "manager's account" that was regularly replenished by the bookkeeper and how, when a local dealer sold a few cars for the thrift store, the dealer was trusted to deposit the cash for them.
In his deposition, the former manager admitted freely to the past criminal charges, which were lodged in California years earlier, one when he was a juvenile. He said sure, the cops did lots of favors for the stores and deserved the repayment. And yes, he said, there definitely was a special manager's account in addition to the regular checking account.
It was already set up, he said in his sworn statement, when he started working there.
Pealer and his supporters have their own theory: They believe national wanted the thrift stores closed because the national management doesn't like locals to have much autonomy and that they wanted Pealer out because he'd supported a man named Charles E. "Butch" Joeckel back in 1993.
Joeckel was the national adjutant, DAV's equivalent of a CEO. Pealer was the national judge advocate. The two men were good friends.
Then the guild of national service officers voted 202-5 to remove Joeckel, alleging misuse of funds and questioning millions spent on a traveling DAV exhibit, legal fees and overseas travel.
A mean fight ensued, with Joeckel's supporters accusing the service officers of sour grapes because he'd streamlined their budget. Pealer defended him.
The next national election was a coup in which all of Joeckel's supporters -- including Pealer -- lost office.
Joeckel was dismissed from the DAV. His attorney, John W. Karr, later defeated national in court and won him reinstatement as a member.
Karr is said to terrify national.
He now represents Pealer.
Last month, Bay walked into the pink-stone Thomas F. Eagleton Federal Courthouse and watched DAV employees file in for the final bankruptcy hearing.
Rufus Conner, who worked for the stores 20 years and said he and his fellow employees "used to get a pension statement yearly. The last one I remember was in the early '90s. I used to wonder why we didn't get them anymore. A few times I went to Stan Pealer personally, and he would always assure me that everything was going well."
Barto Edwards, who had finally gone to the Department of Labor last November to ask about the pension. That very afternoon, says his wife, Mary, federal investigators showed up at the thrift-store office.
Ella Ashford, manager of the Natural Bridge store, who'd written to the bankruptcy attorney on jagged loose-leaf, "I'll waver [sic] the sick pay. But, do not waver the pension."
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