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Final audit into allegations against SUNY Research Foundation released

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Office of the New York State Comptroller

The Office of the State Comptroller has released the final version of the audit into allegations of financial mismanagement at the State University of New York Research Foundation.*

The report from the Division of State Government Accountability found:

Conflicts of Interest, Overpayments, Improper Use of Credit Cards

The audit found that a former senior Research Foundation official based at an office in Buffalo State College, Edgar H. Turkle III, had misused his business credit card during a 48-month period from November 2007 to November 2011. Turkle's case has been referred to legal authorities. 

In a press statement addressing the release of the audit (details of which were leaked to the Times Union last week), state Comptroller Tom DeNapoli commented:

"For too long, SUNY Research Foundation employees took advantage of lax oversight to cheat taxpayers, skirt state laws and violate the foundation's own policies. The Research Foundation needs to vastly improve its internal controls, budgetary oversight, and ensure compliance with all relevant laws and policies. The foundation needs to recover all misspent funds immediately and fundamentally change how it operates."

Auditors also found a potential conflicts of interest in a contract awarded at the central office, and that 10 contracts valued at $3 million were awarded outside the Foundation's own guidelines.

The audit summarizes its conclusion: 

Research Foundation policy states that expenses must support instruction, organization research and other sponsored activities and institutional activities. However, we concluded that a culture of entitlement among some employees, coupled with a cavalier attitude that certain Research Foundation officials demonstrated toward their own policies and responsibilities as a nonprofit organization, undermined the internal control environment and led to abuses.

The SUNY Research Foundation operates six centers for Advanced Technologies, eight Centers of Excellence and funds 11 technology incubators, with another four in development. The map below has a link to their operations. According to the Foundation's Operating Plan for the 2012 Fiscal Year, it was anticipating spending nearly $962 million on sponsored plans and direct spending.
 

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Credit SUNY Research Foundation
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SUNY Research Foundation
SUNY Research Foundation footprint

Dr Timothy Killeen, who took over the position of president of the SUNY Research Foundation in June this year (after former head John O'Connor's abrupt resignation), has responded to the report by saying that the foundation has, amongst other measures:

"...instituted new controls, procedures and protocols that raise the standards of accountability of officers and employees alike, and set clear expectations of ethical behavior, reviewed our policies and procedures related to procurement and contracting across the operation."

 
[*Full Disclosure: The SUNY Research Foundation is an underwriter of the Innovation Trail reporting project.]