New York City – An activist Wall Street investor is calling for the ouster of the board of Yeshiva University, following the school’s endowment’s devastation by the alleged Bernard Madoff Ponzi scheme.
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Andrew Sole of Esopus Creek Advisors – the hedge fund that led a shareholder revolt last year against off-price retailer Syms when the chain’s management voluntarily delisted its shares – demanded in a letter this week the immediate resignation of Yeshiva’s entire board of trustees.
Yeshiva President Richard Joel admitted this week that the university’s endowment has plunged to $1.2 billion from as high as $1.8 billion as the Madoff scandal has unfolded. Yeshiva had made financial bets with Ascot Partners, the collapsed hedge fund run by Ezra Merkin, the embattled GMAC chairman with close ties to Madoff.
Both Madoff and Merkin had served on Yeshiva’s board, and both have resigned those positions.
“Yeshiva has the opportunity to begin the healing process today by installing new fiduciaries that are untainted by scandal and embarrassment,” Sole, a member of the Class of 1999 at Yeshiva University’s Cardozo School of Law, wrote to Joel in a Monday letter obtained by The Post.
Josh Joseph, the Yeshiva president’s chief of staff, responded to Sole in an e-mail Tuesday that “an excellent team of lawyers, accountants and financial experts are studying the situation to make sure all board governance and conflict issues are considered.”
Sole called the university’s response “scripted” and “beyond offensive,” and accused Yeshiva of making an “ostrich defense” by ignoring the crisis.
Mr. Sole makes a good point. While I don’t know how the YU board operates, so many non-profit board members, while well-intentioned, operate as an old boys’ club where everyone is afraid to step on someone else’s toes and ask the hard questions, and there is a tendency toward group think. Board members must know that being on a board means more than just going to meetings and getting a fancy title.
WHATS SOLES CONNECTION TO YU?
what makes a private persons letter “news”
there is no reason to oust board members who lend their name & support to an institution out of their own good will
everyone learns from mistakes & this is a big one
BUT NO REASON TO GO
How much of the $1.8 billion has Andrew Sole contributed? Let him put his money where his mouth is. It’s easy to send off letters and make grand demands.
Many institutions appoint members to the board as a kibud and do not expect most of them to actually do much. Perhaps they should appoint another board, a.k.a. an Executive Committee or Executive Board who actually do the work and would be held accountable.
knla”d
did it read right 1.8 BILLION?? What the heck are these people shnorring money from everyone with such a boat load of cash, ok so now it’s only 1.2BILLION???
Non-profit boards are mostly honorary positions with little or no power and usually not fully informed of the true finances.
Only lawsuits brought by ‘interested’ parties would make changes to how these boards operate. An ‘interested’ party would have to be a very major contributor or a class-action group of contributors.
Rabboisai, The fact is the Dow fell 47% on average which means many individual funds lost more including me—The Board should be fired for not scrutinizing the Madoff money and their accountants definitely fired.. Look at Price Waterhouse and the Indian fraud of billions with Satyam Computer for over 10 years. No more speculation and a special Independent investment committeee should be in place. Fire the accts. Period and the responsible board members..
fire them…..ok….but sue them for their breach of fiduciary obligation….they got the money to pay damages.
why are they trustees? cause they pay to play. they played…let them pay.
Intersting that on YU’s board were Merkin and Madoff, both not shomer Torah and.Mitzvos. A Trustee that does not have the same ethics as the Yeshiva, can be a Board member?
The real answer is that YU is more a college than a yeshiva …..
The activist is dead right, losing so much money is a crime,
Bigger queston what does YU do with so much money?