Maybe Ads Inside Michigan Stadium Wouldn’t be so Bad

This piece in the WSJ on billionaire T. Boone Pickens and the structure of his gifts to Oklahoma State athletic department is worth a look.   Most notably, check out one particular investment strategy involving OSU alums that Pickens dubbed ‘Gift of A Lifetime’:

Separately, Mr. Pickens concocted an unusual plan to supercharge returns for Cowboy Athletics. He sold school officials on a program to generate up to $250 million for the endowment by taking out multimillion-dollar insurance policies on the lives of older Oklahoma State alumni. The expectation was that the death payouts would exceed the premiums.

I know that it’s not uncommon to invest in insurance policies but this is creepy.  

Basically OSU loses if these folks don’t die when they are supposed to…like good & loyal Cowboys would of course.  

Funny, the photo in the article shows a OSU fan holding a giant Pickens head at a game (left).   Thankfully this didn’t escalate to fans raising actual heads of dead alums whose lives proved profitable for the athletic department.

Shocker: the program turned out to be a bust.  More:

Oklahoma State President V. Burns Hargis stepped in to help Mr. Holder, the athletic director, figure out what to do about the $16.6 million in insurance premiums due in February 2009. He called on a retired insurance executive and Oklahoma State alumnus, James Morris, to assess the situation.

Mr. Morris, Mr. Hargis and others met around the fireplace at Mr. Pickens’s Texas Panhandle ranch in early 2009 for a "pretty sobering meeting," Mr. Pickens recalled in his deposition.

Mr. Morris told the gathering he saw little chance of alumni dying early enough to deliver the expected profit, Mr. Morris recalled in a recent interview.

Yeesh.  Wouldn’t it have been more fun if they took out life insurance bets on the lives of prominent alums/former coaches at a rival school like Oklahoma?

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