American University Faces IRS Inquiry

The Internal Revenue Service will investigate American University’s tax records from 2004 to 2006 in a probe related to allegations of excessive spending by the university’s ousted president, Benjamin A. Ladner, according to a statement by university officials (sixth item down).

According to an American University audit released in October 2005, Mr. Ladner charged $500,000 in car, alcohol, and travel costs to the university over a five-year period. Upon being forced to resign, he received a $3.75-million severance package, most of which was retirement money.

Cornelius Kerwin, American’s interim president, said the university will comply fully with the investigation. American is currently searching for a new president.

Read The Chronicle of Philanthropy’s coverage of the spending scandal, a Senate probe related to the scandal, and an opinion piece about the lessons nonprofit groups should learn from the scandal.

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