Oklahoma State University Lost $33M In Insurance Gamble

The fundraising arm for OSU athletics is out $33 million, according to a federal judge. The money was part of a program that had Cowboy Athletics taking out life insurance on some of its older donors.

The program was called Gift of a Lifetime and was sponsored by a non-profit group called Cowboy Athletics, which raises money for the school's sports department. It bought 27 life insurance policies for $33 million over two years.

It was a plan suggested by Cowboy alum and billionaire, T. Boone Pickens.  ESPN.com says it obtained an e-mail from athletic director Mike Holder in which he said if he didn't start the program when Pickens wanted, "I will be in a cave with Bin Laden."

Cowboy Athletics reported it could raise as much as $350 million through the program, but none of the insured boosters died so the university canceled the program after two years.  It tried to recover the $33 million it had paid in premiums over those two years, but a federal judge said "no."

OSU is not talking about the case, releasing a brief statement instead:

"We are surprised and disappointed with the judge's ruling. We are reviewing the opinion and assessing our options, including a possible appeal."

The chairman of the OSU Board of Regents said that it's important to note that no public money was used to pay for the premiums, and the decision to buy the policies did not need approval of the board of regents.

Chairman Jay Helm says the donors who had the policies taken out on them supported the program and even underwent physical exams.