Jon Krakauer reveals that the charity, Central Asia Institute, continues to waste donated dollars and author Greg Mortenson is still dodging accountability.
Numerous
investigations uncovered “financial transgressions” and “serious internal
problems in the management of charity, the Central Asia Institute (CAI).”
The attorney
general ordered Mortenson to pay CAI more than $1 million as restitution and
forbade him from serving as a voting member of the CAI board of directors or
holding any position at the charity “requiring financial oversight.” To avoid
being sued by the state of Montana, Mortenson and CAI signed a settlement
agreement and assurance of voluntary compliance with Bullock that required CAI
to expand its board from three members to at least seven and to hire a new
executive director to replace Anne Beyersdorfer, a longtime friend of the
Mortenson family who had been serving as executive director since Mortenson
took a paid leave of absence shortly after 60 Minutes aired.
From her first day
on the job, Beyersdorfer’s tenure at CAI was characterized by frequent public
statements pledging her commitment to “full transparency,” while simultaneously
doing everything in her power to keep Mortenson’s misdeeds hidden from
journalists, donors, and the public.
Two years have now
passed since the Mortenson scandal erupted. The CAI board has been overhauled,
and a new executive director with seemingly solid credentials took over from
Beyersdorfer in March 2013. But Mortenson remains on the CAI payroll (his
annual compensation is $182,220, according to the most recent financial
information released by the charity), and he continues to exert considerable
influence over its operations. He is still very much the public face of CAI.
Mortenson
apologists counter that his failings and misdeeds are in the past and should be
forgiven. The available evidence suggests otherwise. As the attorney general’s
investigative report pointed out, even when Mortenson’s managerial failings
were brought to his attention, he refused to correct them.
According to
multiple sources, Mortenson routinely sabotaged the efforts of CAI staff to
rectify the dysfunction and corruption they encountered. And this appears to be
attributable, at least in part, to the fact that Mortenson had secrets he
wanted to protect. As an ex-CAI employee told me, “Greg did not like people
discovering things.”
Contrary to the
assurances of supporters who insist that both Mortenson and CAI have cleaned up
their acts, an audit of the charity’s overseas activities by a Pakistani
accounting firm, as well as information provided by other sources in Pakistan
and Afghanistan, indicate that CAI’s foreign operations are currently beset by
widespread corruption. Thanks to appallingly lax oversight that began while
Mortenson was at the helm and continued during Beyersdorfer’s two-year tenure,
many hundreds of thousands of dollars—perhaps millions—appear to have been
wasted or pilfered by some of the charity’s Afghan and Pakistani staff.
The allegations
regarding oversees staff include:
- · a lavish Islamabad home purchased with CAI funds for approximately $486,000, was sold and all the proceeds from this sale was deposited into a personal bank account.
- · a CAI certificate of deposit for $42,000 was redeemed and used for personal expenses.
- · contracts for the construction of colleges and schools were awarded without following any open bidding process
- · family members are paid handsomely for questionable jobs
- · the salaries of four drivers and three vehicles were paid with CAI funds. Two of the vehicles are registered in the name of the CAI Pakistan Trust; one is registered in a private person’s name.
- · as much as $28,000 was spent on air travel in a two day period.
Readers of Nonprofit
Imperative will recall huge charity sums were used to advertise Mortenson’s books and
fly him around the country in private jets in apparent violation of Section
4859 of the Internal Revenue Code, which prohibits board members and executive
officers of a public charity from receiving “an excessive economic benefit”
from the charity.
Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Vermont Public Radio, Miami Herald, National Public Radio, Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), FOX2, ABC Spotlight on the News, WWJ Radio, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, The Chronicle of Philanthropy, St. Petersburg Times, B, USA Today Topics, Newsweek.com, Responsive Philanthropy Magazine, New York Times...and many more Nonprofits: On the Brink (2006) Silence: The Impending Threat to the Charitable Sector (2011)
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