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Friday, October 31, 2014

Did Joe Paterno Sell His House to His Wife for $1 to Avoid Civil Lawsuits?

As more information from the Penn State scandal leaks out, I’m sure we will be uncovering plenty more pieces of shady information like this one. Joe Paterno and his wife bought a home near the Penn State campus for $58,000 in 1969. According to court documents filed in Centre County, Penn. that were uncovered by the New York Times, the house is now valued at $594,484.40. Paterno and his wife, Suzanne, had joint ownership of the home until recently.  Now that’s what I call a solid investment.

For whatever reason, Paterno decided to sell the house to his wife for $1 four months ago, placing ownership of the property solely in her name.  Actually, he sold it to her for $1 plus “love and affection.”  What would inspire Paterno and his wife to complete such an odd transaction?

According to one of JoePa’s lawyers, Wick Sollers, the transaction was simply part of a “multiyear estate planning program” and the transfer was just an element of that plan.  Naturally, they insist Paterno selling his own home to his wife has nothing to do with the Jerry Sandusky scandal.

Legal experts have debated Paterno’s motivation, with some saying that the family’s house has undergone years of complex transactions that would make it impossible to draw any conclusions from this one particular transfer.  However, law professor Lawrence A. Frolik from the University of Pittsburgh said that he has never heard of such a transfer taking place for tax purposes and would only have one initial reaction when told that a man had sold his house to his wife for $1.

“I can’t see any tax advantages,” Frolik said. “If someone told me that, my reaction would be, ‘Are they hoping to shield assets in case if there’s personal liability?’ It sounds like an attempt to avoid personal liability in having assets in his wife’s name.”

Yes it does, doesn’t it?  It is obvious that Paterno could be subject to civil lawsuits in the wake of the massive scandal, so assuming he made this transaction with his wife with that in mind would be not only reasonable but completely commonsensical.  As they so often say: Where there’s smoke, there’s usually fire.



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