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Quick Takes: Tight State Budgets, New Rules Considered on Human Subjects, Ex-Employees Charged With Stealing From Tufts, Big Gifts, U.S. Rules on Loan Programs, Updated 2-Year College Bill in Missouri, Assistant Coaches Without Rights, A Criminal Past

  • Growth in state tax revenues has dropped to its lowest level in five years, according to a new study out from the Rockefeller Institute of Government of the State University of New York. When adjusted for inflation, state revenues are down, which could suggest tighter state budgets and a tough year for public colleges and universities that rely on state appropriations.
  • The U.S. Office of Human Research Protections is seeking advice on whether to issue guidance or require additional training for those who serve on institutional boards that review proposals for research with human subjects. The agency posted its request, which follows criticism that some of those serving on the campus-based boards lack adequate training, in the Federal Register.
  • Two former student-affairs administrators at Tufts University have been indicted on multiple larceny charges related to the theft of nearly $1 million, The Boston Globe reported. Auditors at Tufts received an anonymous tip that set off the investigation. According to the indictments, Tufts funds were used for personal purchases at Gucci, Prada, the Disney Store, Omaha Steaks, IKEA and Foxwoods Resort and Casino. The two ex-officials, who are accused in separate schemes, are Josephine Nealley, director of the student activities office from 1996 to 2007, and Raymond Rodriguez, budget and fiscal coordinator of the office from 2001 to 2007. The Associated Press reported that the two ex-officials and their lawyers could not be reached.
  • Two major gifts to colleges were announced Tuesday. Princeton University has received $100 million from Gerhard R. Andlinger, a business executive, to support energy and environmental research. Claremont McKenna College announced a $75 million gift from the Marie-Josée and Henry R. Kravis Foundation for a new building that will house classrooms, research institutes, and the admissions and financial aid office.
  • The U.S. Education Department on Tuesday published final regulations to carry out changes made to federal loan programs in the College Cost Reduction and Access Act of 2007. The regulations cover the government’s new income-based repayment and public service loan forgiveness plans, among other issues. Also Tuesday, the department published the terms and conditions under which it will purchase student loans from lenders to ensure that borrowers continue to have access to federal loans.
  • The name “junior college” for two-year institutions has generally been replaced with “community college.” In Missouri, however, the outdated name remained in state statutes, until Tuesday. The Joplin Globe reported that a new state law changes the designation in state statutes and regulations. Community college leaders have been urging such a change for decades.
  • Assistant coaches in big-time college football programs frequently lack any job security and many regularly lose their jobs when head coaches arrive or leave institutions, The Dallas Morning News reported. The issue is prompting some to call for 12-month contracts for the assistants.
  • British educators are debating whether a criminal past should disqualify a medical student. The Guardian reported that the dispute involves a student whose admission to Imperial College London was revoked after officials found out that he was convicted of burglary in 2005.

Scott Jaschik

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Comments

Universities unwittingly promote employee theft

Its a matter of simple economics. The basic cost and benefit structure at universities seems to promote constant stream of employee fraud, theft and embezzlement.

When frauds occur, they create work for the auditors and other administrators. Hence university embezzlement and theft can become little more than a source of employment security for the internal auditors.

Did anyone ask why the internal auditors had not identified the internal control weaknesses which permitted the thefts at Tufts to occur in the first place?

Universities should be putting much more emphasis on theft prevention.

The political structures at universities discourage auditors from aggressively questioning middle-level managers. At the same time auditors and administrators are rewarded for investigating these problems after they occur.

This situation could be reversed by altering the underlying organizational economics at universities, i.e. by reducing organizational barriers to fraud detection and prevention and by increasing the costs to non-participants actors when frauds do occur.

Shift the emphasis, and hold people accountable for prevention, and the problem of employee embezzlement and theft at our universities will be greatly diminished.

Ken D., at 12:10 pm EDT on July 2, 2008

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