Foundation watchdog puts Getty on probation

By Steve Gorman

LOS ANGELES (Reuters) - The nation’s main umbrella group for nonprofit foundations has placed the J. Paul Getty Trust, one of the world’s richest art institutions, on 60 days probation over allegations of financial misconduct levelled in recent news reports.

The action taken by the Washington, D.C.-based Council on Foundations carries no finding of wrongdoing, but is tantamount to a notice that the trust is "not in good standing," council president Steve Gunderson said on Wednesday.

"It’s like saying, ’You’re on watch. Your conduct is of question,’" Gunderson told Reuters. "We have found evidence to date of the allegations to be sufficiently serious that the board felt some action was appropriate."

A council statement said it was examining "charges against the Getty related to the sale of Getty property, the use of foundation assets for personal benefit, excessive travel and entertainment expenses, inappropriate compensation for the foundation’s CEO and potential self-dealing."

The Getty has failed to furnish all the information the council has requested since June for its inquiry into the matter, Gunderson said.

He said he was aware the Getty already is under pressure to deliver information demanded for a separate probe by the California attorney general’s .....continued below

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Getty spokesman Ron Hartwig said the institution was "working with the council to address its questions and we look forward to cooperating with them and to reaching a satisfactory outcome."

’OUR DESIRE IS TO RECTIFY THE MATTER’

He added: "Our desire is to rectify the matter and get back in good standing as soon as possible."

Gunderson said some, but not all, of the allegations stem from reports in the Los Angeles Times earlier this year that tax-exempt funds of the trust were misused by the Getty’s chief executive, Barry Munitz.

The Times reported that Munitz had spent the trust’s money on lavish pay, travel and perks, and appeared to have influenced the sale of Getty property to Los Angeles billionaire Eli Broad, a close friend.

The Getty’s governing board appointed a committee in October to conduct its own inquiry into Munitz’s use of trust funds, as well as questions raised about its acquisition of ancient artifacts.

That panel was formed three months after Getty antiquities curator Marion True was charged by the Italian government with conspiring with dealers trafficking in looted items. True has quit the Getty Trust and is on trial in Rome.

The J. Paul Getty Museum has agreed to return three of 42 disputed archeological treasures that True acquired in Italy.

The Getty has denied reports of wrongdoing in the past and said that an audit by federal tax authorities for 2001-2003 had found nothing wrong with Munitz’s pay and perks.

The probation imposed against the Getty marks the first such action taken by the council under tighter new ethics standards the body adopted last year. The council represents some 2,000 nonprofit foundations and corporate grant-makers in the United States.

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