In Other Ivory Towers: Harvard marred by financial scandal, NYU receives record gift

Two notable financial stories highlight the best and worst of managing money at the nation’s top universities. While New York University (NYU) received a $150 million donation from noted alum Julius Silver, Harvard University faces the prospect of having two seniors convicted of embezzling money from Hasty Pudding Theatricals, the oldest undergraduate theater organization in the United States.

The accounting discrepancy at Hasty Pudding involves two top leaders of the theater group, Suzanne M. Pomey and Randy J. Gomes. An incoming Hasty Pudding producer, Lena Demashkieh, noticed the accounting discrepancy while reviewing the group’s records.

Both Pomey and Gomes are accused of using Hasty Pudding’s credit cards to transfer money to their own accounts. The money was in turn used to support Gomes’ drug habit as well as trips to East Coast cities.

Andrea Shen, Harvard spokeswoman, declined to discuss the students’ situation, explaining that the University waits until enrolled students have completed criminal proceedings before deciding on disciplinary action.

At NYU, Silver’s loan marks the high-water mark of an impressive record of contributions to the school. Silver began his career at NYU 83 years ago, when the University offered him a scholarship of $77.50 and a $100 loan. He went on to graduate Phi Beta Kappa from NYU and attend Columbia Law School, after which he helped start the law firm of Silver, Saperstein, Barnett, and Solomon. Silver was also a co-creator of the Polaroid Corporation.

Silver died last month at the age of 101 and while the gift – the largest cash donation NYU has ever received – had been planned by Silver for quite some time, he did not wish the amount to be revealed until after his death.

Silver’s affiliation with Polaroid started when he met Edwin Land, the main force behind the company. The two met at a summer camp where Silver was a counselor and Land was a camper. The relationship grew, with Silver serving as Land’s business advisor for more than 50 years.

As Silver’s economic success grew, he embarked on a career of generous giving to various educational institutions. Silver contributed money for the founding of Brandeis University and also donated regularly to Columbia Law School and other institutions. Silver began contributing modestly to NYU in the 1950’s, when his contributions ranged from $100 to $500. But as early as the 1960’s, Silver began seriously contributing; by the time of his last gift, he had given money for a student dormitory and three faculty residence buildings had been named after him.

However, perhaps no gift that Silver has given will be as important to furthering the education mission of NYU than his most recent donation.

The $150 million will be used to endow about 150 faculty chairs over the next 25 years and to pay for scholarships. According to L. Jay Oliva, president of NYU, the size of the gift is especially important because the interest alone will continue generating faculty chairs.

“I had this dream about creating a chair machine, where you don’t spend the principal but only spend the income to create faculty chairs,” Oliva said. “If you create six chairs a year for 50 years, that’s 300 chairs—almost the whole faculty of arts and sciences.” The chairs will be named after Silver, his late wife Roslyn, and his late daughter, Enid Silver Winslow.

-Information compiled from The New York Times.

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