By Howard Kurtz
Washington Post Staff Writer
Friday, April 23, 2004; Page A01

USA Today editors ignored repeated warnings about problems with Jack Kelley's reporting, including from government officials, while a newsroom "virus of fear" deterred many staffers from challenging what became the worst scandal in the Gannett paper's history, an investigative panel said yesterday.

Kelley, who has now apologized, made up parts of at least 20 stories stretching back to 1991, according to the report by three outside editors asked to investigate the former star correspondent's work. Kelley also billed the company for thousands of dollars in payments to translators and drivers who now say they never received the cash, the panel found.

The report amounts to a stinging indictment of the culture of the nation's top-selling newspaper, which the panel says has increasingly tried to compete with the New York Times and The Washington Post and trumpeted the globe-trotting exploits of Kelley, a Pulitzer Prize finalist, in that effort. The document's release prompted a key managing editor to resign.

Unlike the fabrications of such young and untested journalists as The Post's Janet Cooke in 1981, the New Republic's Stephen Glass in 1998 and the Times's Jayson Blair last year, Kelley, 43, was a two-decade veteran at USA Today and a management favorite whose too-perfect stories left a trail of red flags that went unheeded. As USA Today gradually transformed itself from a bland "McPaper" known mainly for short stories and flashy graphics, even Kelley, who kept parachuting into war zones and filing reports about dramatic shootings, bombings and drownings, said he felt pressure to produce scoops.

In an extreme version of the problems that trouble many news organizations, the report depicts a rivalry-filled newsroom in which top executives failed to communicate, reporters were intimidated by their bosses and those who complained about Kelley were dismissed as jealous whiners.

Kelley's deceptions had become almost an open secret, and there were so many warnings that it is a "mystery" why the earlier complaints "were rebuffed, rejected or ignored," said John Seigenthaler, USA Today's founding editor and head of the independent panel that included Bill Hilliard and Bill Kovach.

Two more senior editors said yesterday they would be stepping down, following Tuesday's departure by Karen Jurgensen, the paper's top editor. Hal Ritter, managing editor for News and a divisive figure in the newsroom, resigned, telling the staff in a statement: "I don't think anyone could possibly be more upset about the Kelley mess than I am. . . . My departure will make it easier for my colleagues in News to continue the job of making the newspaper even greater."

Jurgensen's deputy, Executive Editor Brian Gallagher, also announced his intention to step aside. "I plan to stay in this job long enough to manage a transition to the next editor," he said.

Publisher Craig Moon said, "The report is brutally factual for us and does give us a platform going forward." Moon said that he had agreed with Jurgensen's decision that it would be "best for the newspaper" if she resigned and that he plans to name a successor -- he has interviewed only candidates from other Gannett papers -- perhaps as early as today.

Kelley, who had steadfastly maintained in interviews with USA Today and The Washington Post that he did nothing wrong, has now abandoned that stance. "I have made a number of serious mistakes that violate the values that are most important to me as a person and as a journalist," he told his former newspaper in a statement. "I recognize that I cannot make amends for the harm I have caused to my family, friends, and colleagues."

So widespread was the concern about Kelley's work that in early 2002, the panel found, four News section editors convened what a memo from one of them described as "a secret meeting to discuss the veracity of Jack's reporting." Despite their worries that Kelley was "embellishing stories and making up quotes," they decided they lacked the proof to recommend that he be grounded as a foreign correspondent.

"That was an opportunity for them to break through the crust of deception, and for some reason they failed to do so," Seigenthaler said in an interview. "It's inexplicable."

Kelley resigned in early January, admitting only to a single instance of trying to mislead the paper on his source for a now-discredited story involving a diary of war crimes in Yugoslavia.

Complaints to the newspaper spanned the globe, according to the report:

• A high-ranking Treasury Department official told a USA Today staffer that government officials were skeptical of Kelley's reporting about an alleged Russian money-laundering scheme. The complaint was passed on to an editor but was ignored.

• A national security analyst earlier this year wrote USA Today: "Years ago I repeatedly complained about accuracy in Mr. Kelley's reporting. I was met with insult and assured that his longtime standing with USA Today and his professional qualifications outweighed any concerns I might have voiced."

• A written complaint from a foreign source, which bluntly and specifically challenged Kelley's work, drew no response for more than two years. The panel was told the letter "somehow had been lost."

Among the stories now disavowed by USA Today are Kelley's reports "that he found diaries alongside the corpses of Iraqi soldiers in 1991; traveled to a village in Somalia to interview an aid worker in 1992; discovered matches made from napalm that could burn through glass ashtrays in 1993; trekked into the mountains of Yugoslavia with the Kosovo Liberation Army in 1999; listened to a tape that captured the downing of a missionary flight over Peru in 2000; visited with Elian Gonzalez's father inside the father's house in Cuba in 2000; visited Osama bin Laden terrorist camps in Afghanistan in 2001; and spent time near the cave complexes of Tora Bora in 2001."

In addition, "there appears to be no basis for a 2002 Kelley story that said U.S. forces in Afghanistan found evidence linking two Chicago-based Islamic charities to al-Qaeda."

Some of Kelley's colleagues told investigators that management wasn't interested in criticism of a correspondent who often appeared on television, gave speeches on the paper's behalf and "conveyed that ranking executives of USA Today were his close friends."

Several current and former staffers elaborated in interviews. Reporter Barbara Slavin recalled a CIA official telling her in 2001 that Kelley's report of the downing of a missionary plane in Peru -- which included a supposed cockpit conversation in which the pilot shouted, "They're killing us!" to the control tower -- was flat wrong.

"I reported that to my editors, several of them," Slavin said. "They confronted Jack, allegedly. He said he had a source in the Defense Intelligence Agency who played the tape for him. The editors seemed satisfied, so I let it drop." Kelley is "such an extremely pleasant man that you wanted to give him the benefit of the doubt."

Chicago correspondent Debbie Howlett, who reported from Albania in 1999, said she told two editors she didn't believe Kelley's dispatch about accompanying Kosovo rebels into the mountains of Yugoslavia. "Nobody followed up," Howlett said. "Jack's a pretty good liar, but he had some pretty inept editors helping him along."

Reporter John Diamond said he raised questions about a 2002 story in which Kelley quoted three unnamed sources as saying that bin Laden's voice was on an audiotape -- at a time when federal officials told Diamond the analysis was not finished.

Correspondent Tom Squitieri, who has reported from the Balkans, said he "questioned the veracity" of some of Kelley's stories from the region in 1999 but was "rebuffed by editors. . . . I didn't get the idea people were interested in me bringing anything up." He said his complaint might have been dismissed because he was asking then-Deputy Managing Editor Mark Memmott to send him to Yugoslavia.

Memmott said he does not recall the warning, but added: "I've been racking my brain to say, what did I miss? I must have missed something. I was in a position where I should have been more vigilant."

On a 2002 story reported with Kelley about the hunt for bin Laden, said former correspondent Jonathan Weisman, he challenged five unnamed intelligence sources that Kelley had cited. When the existence of four of them could not be confirmed, Weisman said, editors simply cut those sections from the piece.

"It wasn't a 'virus of fear,' it was laryngitis," said Weisman, now a Washington Post reporter. "It was people just getting sick of complaining and nothing getting done. People weren't afraid of talking about Jack Kelley. It struck everyone as pointless. He was protected from on high by the editors."

Kelley routinely abused the paper's rules on the use of anonymous sources, the panel concluded, calling the editing standards "appallingly lax." The rules themselves are badly flawed and do not always require reporters to tell editors the identity of their confidential informants, the report says. Two staffers were so dubious of Kelley's unnamed sources that they had their bylines taken off joint stories.

David Mazzarella, who preceded Jurgensen as editor, said he had not heard the warnings about Kelley. "You would think that somehow it would percolate up, but in my experience, it didn't," he said. "My door was open." As for his tenure, Mazzarella said, "there was a concerted effort to improve performance and maybe some people felt threatened by that."

The report, which did not identify those interviewed, offered varying explanations from editors. One of the four editors who attended the secret meeting on Kelley told the panel: "All we had was gossip and rumors. We decided that we didn't want to damage a reporter's reputation based on what we knew."

Another, who played a role in editing one of Kelley's fabricated articles, was quoted as saying: "I remember thinking at the time that it was a great story if true."

In findings reminiscent of the Blair scandal that revealed festering tensions under former Times editor Howell Raines, the report describes a Tysons Corner newsroom bordering on dysfunctional: "Lines of communication running both horizontally and vertically among the sections (or 'silos') at the newspaper are palpably defective. USA Today operates more as four separate newspapers in four separate 'silos' (some staffers used the word 'fiefdoms') than a single publication."

The high-pressure atmosphere drove away talented staffers, the panel said. "I decided I would be divorced or dead if I'd stayed there," former reporter Judi Hasson said in an interview. "The atmosphere was so vile and so terrible. You had to perform whether you had the goods or not. They put enormous pressure on people and played mind games with people. It was really sick."

Newsroom employees "worried most, not about what they were giving the readers of USA Today, but about giving the editors what they wanted to hear," the report said.

Several staffers criticized what they called the heavy-handed style of Ritter, whose section is dubbed the "House of Mean," according to the report. But Night News Editor Carl Pisano praised Ritter's high standards, calling him "demanding" but "fair."

Memmott said the panel should have addressed the lack of adequate staffing in the 400-person newsroom. "That's why stories are getting railroaded into the paper with not enough scrutiny," he said.

Moon, the publisher, did not minimize the report's impact. "These kinds of instances -- whether it's Janet Cooke or Jayson Blair -- just continue to eat away at the credibility of people who are doing very good, honest journalism," he said.