INVESTIGATIVE DOCUMENTS
United States District Court,
District of Massachusetts.
Civil Action No. 00cv11977DPW (September 26, 2000)
United States of America, Plaintiff,
v.
the President and Fellows of Harvard College,
Andrei Shleifer, Jonathan Hay, Nancy Zimmerman,
and
Elizabeth Hebert, Defendants.
COMPLAINT AND JURY TRIAL DEMAND
I. INTRODUCTION
1. The United States alleges that Harvard university ("the President and Fellows of Harvard College" or "Harvard") and its
employees, Andrei Shleifer and Jonathan Hay, defrauded the United
States out of at least $40 million dollars paid to Harvard to
provide impartial and unbiased advice in connection with a United
States' assistance program in Russia. The United States alleges
that Shleifer and Hay abused their positions as high-level and
trusted advisors to and on behalf of the united States in Russia,
and misused resources funded by the United States for their own
personal benefit and the personal benefit of their wives,
girlfriends and/or business associates. Harvard, which was paid
by the United States to provide impartial and unbiased administration and oversight of the assistance program in Russia,
failed in its obligation to provide such oversight, and instead
mismanaged and abused the resources entrusted to it by the United
States. As a result of Defendants' misconduct, the United States
suspended and ultimately terminated the Harvard project in Russia.
2. The United States alleges that Defendants' actions
undercut the fundamental purpose of the United States' program in
Russia -- the creation of trust and confidence in the emerging
Russian financial markets and the promotion of openness,
transparency, the rule of law, and fair play in the development of
the Russian economy and laws.
3. During the course of the Harvard project in Russia.
Defendants submitted and/or caused t- be submitted to the United
States false and/or fraudulent bills and other statements. These
bills and statements falsely and/or fraudulently represented that
Harvard, Shleifer, Hay and others under their direction were
providing impartial, unbiased advice pursuant to policies which
forbade investments in Russia, and that Harvard was providing
services in accordance with the terms and conditions of its
agreements with the United States.
4. The United States paid at least $40 million to Harvard
because of Defendants' false and/or fraudulent representations
that Harvard, Shleifer and Hay were providing services which were
free from bias and in accordance with the agreements between the parties. The United States also paid at least $350 million to
other contractors under the oversight and supervision of Harvard.
Full text of the COMPLAINT is available in PDF format.
United States District Court,
District of Maine.
Civil Action No. 00-306-PH (October 24, 2000)
Forum Financial Group, Limited
Liability Company
and John Y. Keffer, Plaintiff,
v.
President and Fellows of Harvard College,
Jonathan R. Hay, and Andrei N. Shleifer, Defendants.
COMPLAINT AND DEMAND FOR JURY TRIAL
I. INTRODUCTION
1. The Plaintiffs Forum Financial Group, Limited Liability Company ("Forum"), a mutual fund administrative services provider, and John Y. Keffer ("Keffer"), Forum's owner, bring this action against the Defendants President and Fellows of Harvard College ("Harvard"), Jonathan R. Hay ("Hay") and Andrei N. Shleifer ("Shleifer") for common law fraud, tortious interference and negligence. In 1992 and 1995, the United States government, via the United States Agency for International Development ("USAID"), entered into two contracts to pay Harvard Sixty Million ($60,000,000) Dollars to provide the Russian Federation ("Russia") with advice and technical assistance for privatization, legal reform and the creation of capital markets. Harvard employed
Shleifer and Hay to create and manage Harvard's program in Russia (the "Russia Program") and implement the tasks called for in Harvard's contracts with the United States government.
2. Harvard failed to supervise and monitor the services Shleifer and Hay provided to Russian officials and, further, failed to supervise their use of the USAID funds under their control. As a direct and foreseeable consequence of Harvard's lack of oversight and abdication of its responsibility under the USAID contracts, Hay and Shleifer used their Harvard positions and influence with Russia officials to obtain for their own personal benefit Russian business interests. These relationships facilitated their defrauding of Keffer and Forum to own and/or control the first Russian specialized depository, i.e. the management and custodian service company necessary to administer mutual funds.
Shleifer and Hay were aware that the development of a mutual fund industry in post-communist Poland had been financially successful and intended to duplicate that success in Russia and personally reap its benefits. Shleifer and Hay lacked, however, the capital, technical expertise and industry credibility required to create and license a specialized depository. They were aware that Forum was successfully providing third-party administrative services in Poland and thus would be able to create similar services in Russia.
3. Shleifer and Hay agreed and conspired to misappropriate the first Russian specialized depository from Keffer and Forum. They were joined in this unlawful conspiracy by Beth Hebert ("Hebert"), Hay's girlfriend at the time who is now his wife, Nancy Zimmerman ("Zimmerman"), Shleifer's wife, and Julia Zagachin ("Zagachin"), a former Russia Program associate who had worked with Hay on privatization projects. As a direct result of Harvard's abdication of its oversight responsibilities, Shleifer and Hay fraudulently induced Forum and Keffer to create a specialized depository in Russia which Shleifer, Hay and their coconspirators misappropriated for their own benefit. As a result of Hay's and Shleifer's actions and Harvard's negligence, Plaintiffs have suffered significant harm.
Full text of the COMPLAINT is available in PDF format.
July 27, 1992
World Institute for Development Economics
Research Project on the Transformation of Centrally Planned Economies
Report on Activities, First half of 1992.
I. INTRODUCTION
The two-year WIDER project, "The Transformation of Centrally
Planned Economies: The Lessons for Developing Countries,” led by
Professor Jeffrey D. Sachs of Harvard University, has now been
completed. In accordance with the Agreement between FINNIDA and
WIDER, the project team is submitting this report, which includes a progress report and financial statement for the six month period, January to June.
More specifically, the report includes the following five parts:
1. A progress report describing the activities undertaken by the team during the period January 1 - June 30, 1992.
2. An itemized description of research outputs over the entire project period.
3. A listing of papers completed during the six month reporting period.
4. A listing of the actual work of the team, which can be compared with the tentative work plans submitted at the beginning of the period.
5. A financial statement according to budget categories for the first half of 1992.
A final report, and financial statement will be submitted by the end of October 1992 in accordance with the Agreement.
The following progress report begins with a general description of the project, its members, and the progress made during the reporting period. This is followed by a more detailed summary by country, of the research that the project team has undertaken during the period. The next section describes how the lessons for developing countries have been derived and transmitted.
Full text of the REPORT is available in PDF format.
