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DEMCO executive resigns after Nakamoto report last night
UPDATE: John Vranic, DEMCO's outgoing CEO, will resign effective today amid a report by the WBRZ Investigative Unit.
Click here to read the full statement released by DEMCO Tuesday afternoon.
CENTRAL – The outgoing head of DEMCO, an area power provider and the state's largest electric cooperative, is being scrutinized for a company-purchased $14,000 generator installed at his house.
DEMCO bought the generator found at John Vranic's home in Central and two others after Hurricane Gustav. The company planned to use the three generators to power service towers and critical infrastructure. It was revealed recently that only two of the generators were accounted for – the other was found set up along the side of Vranic's large home.
Vranic, who made $330,347 plus $89,912 in bonuses in 2016, abruptly announced his retirement from DEMCO earlier this year. Sources said when the generator issue was made public, he paid restitution.
Vranic has served as CEO of DEMCO since 2009 and, at the time the generators were purchased in 2008, was in another role at the area utility company. He'd just been given a contract extension before he retired. Though, as of this post, remains head of the utility company as the company conducts a search for his replacement.
“It's just not right. It's corrupt and self-dealing,” LSU law professor Ken Levy said about the matter. “He's making $350,000 at his job and took an item that's worth 30 percent of the median income in Louisiana… I'm glad it's being exposed."
Documents obtained by the WBRZ Investigative Unit show DEMCO bought the three Generac generators and were delivered by Gulf Coast Maintenance to DEMCO's Wax Road office in June or July 2009. One of those generators was installed at Vranic's Lariat Avenue home.
When approached outside his DEMCO office, Vranic did not want to make a statement.
"I don't have any comments, sorry," Vranic said. "It was taken care of."
Vranic refused to look at documents related to the generator but said he paid for it, though refused to acknowledge when. Sources said that didn't happen until he got caught.
DEMCO's Vice President of the Board, Steve Irving issued the following statement:
"...We are aware of the allegations concerning John Vranic having had a generator. The allegation is that the generator was taken during the aftermath of Hurricane Gustav for John to power his own house. The applicable board policy would prohibit this use without the permission of the CEO. John was not the CEO at the time. He maintains that the CEO at the time approved his buying the generator from DEMCO. The CEO at the time was later terminated by the board for other reasons and many board members are inclined to believe John, particularly given knowledge of the other parties involved. John made a serious error in judgment nonetheless.
John Vranic has been with the company for 39 plus years and has a level of knowledge about the system that is not easily replaced. He has a proven record of being able to get the lights back on after storms and a proven record of modernizing the system and negotiating favorable power contracts and keeping down costs. John is retiring and DEMCO is in the process of advertising for a new CEO and expect to have the new CEO in place in a couple of months. It is my judgment that the disruption of having to appoint an interim CEO and not having John available for the transition to the new CEO is not in the benefit of the people who elected me to this board."
Former CEO Jeff Kilpatrick told WBRZ he never authorized the generator deal and "did not appreciate Vranic bringing his name into this."
"This is clear evidence of a crime," Levy said. "I want to know what other criminal activity he or – possibly colleagues of his – engaged in. I want a full investigation. It stinks. It's clear corruption. Generally, when there's one corrupt act you see other corrupt acts surrounding it."
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