TAX AND ACCOUNTING PROBLEMS AT HARVARD?

Harvard Management Company—which oversees Harvard’s multi-billion dollar endowment—was plagued by a culture of ethical laxity, Rose said. Special relationships with funds run by former employees and the use of offshore investment companies—both used to boost HMC’s once-legendary returns—may not be illegal, but are considered to be ethically questionable by some, particularly in light of Harvard’s non-profit status. . . . After his resignation, Rose said his concerns only deepened, fueled in part by Enron’s high-profile implosion due to unethical accounting practices—including the liberal use of offshore accounts. He says he noticed disturbing similarities in Enron’s and HMC’s investment strategies, which prompted him to file a disclosure in early 2002 detailing his concerns with the Internal Revenue Service and the U.S. Senate Finance Committee.

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