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A slippery slope…

When a company discloses a few pages of related party transactions, investors really need to pay closer attention. When that disclosure suddenly increases even though the deals being disclosed appear to be several years old, that’s definitely worth paying attention to. Such is the situation at Vail Resorts (MTN), which released its 10-K yesterday. The company noted 18 different related party deals in the K, up from 10 in last year’s filing, even though many of the deals seem to go back quite a few years. For example, the company discloses that it allowed the president of Vail Resort Development Corp., a subsidiary, to purchase a homesite at a deep discount and without putting any money down back in 1995 !!! The deal itself may be small in the greater scheme of things, but it should speak volumes to investors. The company also disclosed in the K that the SEC had issued the company a subpoena, which is probably a big part of the decision to be more forthcoming with investors.