Student Theft Runs Deep

Details of the alleged theft from the Hasty Pudding Theatricals and the College’s response mirror a number of recent instances of theft from student groups.

After a rash of pilfering scandals, including the theft of $127,000 from Eliot House’s annual Evening with Champions (EWC) benefit in 1993, the College responded by requiring a two-hour long seminar on financial management for student group leaders—however, administrators resisted any drastic changes.

“We’re not planning to change our policy if we can possibly avoid it,” Dean of the College Harry R. Lewis ’68 said at the time. “The autonomy of the student organizations can be maintained.”

Nearly ten years later, the recent arraignment of Randy J. Gomes ’02 and Suzanne M. Pomey ’02 for allegedly stealing nearly $100,000 from the Hasty Pudding Theatricals has made headlines around the country.

But the College, which does not regularly audit student group finances, has not articulated plans to dramatically alter its current policies.

“There is no completely foolproof way to avoid financial improprieties completely,” Associate Dean of College David P. Illingworth ’71 wrote in an e-mail.

A Dark Decade

The alleged theft of nearly $100,000 from the Hasty Pudding Theatricals is not unprecedented.

In 1995, only three years after the $127,000 heist from the EWC treasury, scandal shook two highly visible student organizations—the Yearbook and the Krokodiloes, a popular a capella group.

Both the thefts from the Yearbook and the Krokodiloes, whose treasurer allegedly pilfered $3,000, were smaller in magnitude than the EWC scandal.

Two years later, a Currier House Committee member noticed $15,000 in missing funds from the organization’s treasury.

Former House Committee Treasurer Natalie J. Szekeres ‘97 was eventually indicted of siphoning $7,550 of the funds to her personal account over a six-month period in 1995.

However, the EWC fiasco constituted the biggest public relations debacle. Proceeds from the annual figure skating show, which regularly draws Olympic medallists to perform, are donated to the Jimmy Fund for cancer research.

Charles K. Lee ’93 and David G. Sword ’93, both EWC executives during their senior year, took advantage of the organization’s shoddy record keeping system—Sword was said to keep receipts in a milk carton—to siphon away money.

When Lee and Sword’s successors assumed leadership of the organization the following summer, they discovered $160,000 missing.

Lee and Sword were both convicted and Lee spent a year in prison.

According to Emily R. Murphy ’02, last year’s EWC treasurer, it would be nearly impossible for such a theft to go undetected now. An oversight committee regularly audits EWC’s finances.

“You could do it but you would be caught right away and it would be obvious that you did it,” she says.

The alleged thefts in the 1990’s, like the ongoing Pudding investigation, involve glamorous campus personalities and organizations.

Lee and Sword, like Pomey, were well known around campus. He used money he inherited from his grandfather, according to a close friend, to drive expensive sports cars, maintain a fancy stereo system in his room and smoke Cuban cigars.

Lee rose quickly through EWC’s ranks and was known by many for his caring—after a death in the family of one of the skaters in the show, Lee drove the skater back to her native Montreal.

Sword also amassed an impressive resume during his time at Harvard. He socialized at the Fox, an all-male final club, was active in the Phillips Brooks House, served as business manager for the Hasty Pudding Theatricals and helped produce Citystep, a dance program for underprivileged children.

What Can Be Done?

While EWC reformed its auditing practices following the theft, the College never overhauled its system of monitoring student group finances.

In fact, the policies in place 13 years ago closely resemble the current system.

The 1989-1990 Student Handbook required that all student groups present a financial report to the Dean of Students. According to the Handbook, “a management seminar is held each spring to introduce new officers to basic accounting procedures.”

The College also offered grants for student groups to consult with an accountant.

Current systems to monitor student groups are slightly more stringent.

A required seminar on accounting procedures is held each fall for student leaders.

Illingworth says that since the spring of 2000, he has called in Risk Management and Audit Services (RMAS)—which normally audits the University’s budgets—to help audit certain student groups.

Gregory E. Murray, a senior managing auditor at RMAS, says the group has only conducted one student group audit—but refused to identify which student organization was audited.

He says his boss, RMAS Director Deloris Pettis-Donaldson, sent an e-mail to RMAS staff last Thursday saying the number of student group audits might have to increase.

Murray says he is not sure if RMAS has the capacity to conduct more than the five or six audits per year Illingworth had originally requested.

Pettis-Donaldson did not return repeated phone calls.

Illingworth says that following the alleged theft from the Pudding, he has enlisted the help of RMAS to review the Pudding’s financial practices.

He says that in the wake of the Pudding theft, the College will look more closely at the budgets of some of the larger student organizations.

“Will I as a result of this scrutinize things more closely? Of course,” Illingworth says.

Trust at Harvard

Currently, all student groups recognized by the College must submit an annual budget to Illingworth’s office. While Illingworth says his staff reviews these budgets, he acknowledges the College cannot scrutinize the finances as thoroughly as can RMAS.

Illingworth says he expects more student group leaders to seek advice on handling their money properly as a result of the recent Pudding scandal. Indeed, he reports that several groups have already approached him.

“There might be some good that comes out of this,” Illingworth says. “The current producers of the Pudding are very responsible people and if they had a better system this might not have happened.”

Because so few groups can be audited by RMAS each year, Illingworth emphasizes the importance of the mandatory educational seminars.

“It’s basically free training,” he says. It gives them an actual chance to get procedures that can be passed down from treasurer to treasurer.”

Illingworth says he prefers to consider the College a partner working with student groups toward proper record-keeping rather than an intrusive presence.

He says students are generally cooperative when asked to enact changes to improve their organizations.

Student group leaders say the seminars, which aim to educate newly elected treasurers on how to properly keep records and handle large amounts of money, are effective.

Run by RMAS experts, many of the seminars cite the Evening With Champions theft as an example of what could go wrong.

The seminars can only suggest guidelines, students say, for its leaders do not check whether the student treasurers are following proper procedures.

Nevertheless, students say they still find the suggestions useful.

“It was good seeing an example of how a budget should be run,” said Jasmine J. Mahmoud ’04, the treasurer of the Black Students Association and a Crimson editor.

Illingworth says that in deciding on oversight policies, he wants to avoid a heavy-handed approach.

“There’s still a lot of trust at Harvard,” he says.

Despite the history of a few high-profile scandals, Illingworth says the state of student group finances is strong overall.

“When you consider the number of organizations and the amount of money which goes through them, we’ve had very few problems,” he says. “Statistically it hasn’t been bad.”

—Staff Writer William M. Rasmussen can be reached at wrasmuss@fas.harvard.edu.