Kenneth Cole amfAR gala, New York, America - 11 Feb 2015

Harvey Weinstein’s myriad of problems include a questionable agreement with amfAR’s chairman Kenneth Cole to split proceeds from a fund-raising auction between the AIDS-fighting nonprofit and the American Repertory Theater in Boston. For reasons undetermined, Weinstein needed to make a $600,000 payment to the Harvard University-associated nonprofit theater by June 1, 2015. Weinstein was producer of the musical “Finding Neverland,” which had a trial run there. The theater had arranged to reimburse Weinstein and the show’s other investors for the trial run as long as the investors lined up third parties to donate the amounts, according to published reports.

Cole, who has served as amfAR’s chairman for more than 12 years and a board member for more than 30 years, agreed to split the proceeds for the lots he provided up to $1.2 million between amfAR and the American Repertory Theater. Proceeds above $1.2 million would go to amfAR, according to published reports. That agreement was made despite the fact that amfAR had not done that before with another group. After the fact, Cole is alleged to have gone to great lengths and expense to amfAR to conceal that deal, asking board members to sign NDAs.

Cole declined to comment Thursday, but a spokesman issued the following statement on his behalf. “Since joining amfAR’s board three decades ago, I made the organization’s mission to save lives and find a cure for HIV/AIDS my own. During that time, amfAR has seen its annual revenues triple to more than $50 million and launched the greatest expansion of the foundation’s grant making with its $100 million investment strategy in support of its ‘Countdown to a Cure for AIDS Initiative.’ As a result, the organization has played a significant role in breakthroughs for AIDS research, treatment, and prevention.

“In regards to the actions of Harvey Weinstein recently revealed in media reports, let me repeat publicly what I have been saying privately: I find his actions deeply disturbing but if there is any good to come out of these revelations it is the start of a thoughtful self-reflection of our society and of our collective behavior,” he continued.

“Over the last several weeks Weinstein’s charitable role in supporting amfAR has become the subject of debate and scrutiny. After the New York Attorney General’s Office reviewed the transaction between amfAR and Weinstein they declined to pursue an investigation. It did, however, highlight opportunities to strengthen the governance of the organization. I am personally committed to implementing the OAG’s recommendations to ensure that our fundraising policies and procedures are never called into question again. The mission is too important, there remain millions of lives at risk and the work is far from finished to allow any of us to be distracted from the task of conquering HIV/AIDS.”

In the wake of the auction controversy, five amfAR board members resigned and 15 remain. Four of the remaining board members — Arlen Andelson, Vin Roberti, Jonathan Canno and Mervyn Silverman — have banded together challenging amfAR’s leadership. A spokesman for those four men issued a statement Thursday on their behalf, “Each one of us cares deeply about amfAR’s mission to find a cure for AIDS, and we’re incredibly passionate about the work we do as a scientific organization. As members of the Board of Trustees with decades of combined service, we are acutely aware that our duty is first and foremost to protect this organization for the benefit of the people we serve and our loyal donors. As part of that duty we are committed to ensuring that the board is engaging in appropriate and legal conduct and is meeting its fiduciary obligations.

“We discovered that in June 2015 the non-executive chairman of the board of trustees caused $600,000 to be transferred to a recipient outside the organization despite the clear objections of the executive management team and without the knowledge of the entire voting members of the board. We are extremely concerned about this and other actions by our non-executive chairman and other members of the board and their apparent failure to abide by our governance policies on a number of occasions, which we believe was in clear violation of their fiduciary duties to the organization. In addition to raising these issues with the entire board and retaining additional outside counsel to conduct a review of the matter, we believed it was our obligation to report them to the NYAG and seek to prevent this conduct from continuing and causing significant long-term damage to an organization that does such important work and is so close to achieving its mission of finding a cure.”

Weinstein lined up a few big-ticket draws for the auction in Cannes including photo shoots with Mario Testino, which were sold for $381,100 and $278,000, respectively. A spokeswoman for Testino declined to comment Thursday about whether the photographer knew the shoots he had offered would benefit A.R.T. and not amfAR.

In rehearsals for the national tour of “Waitress,” the theater’s artistic director Diane Paulus declined comment Thursday. A theater spokeswoman said, “ART received $600,000 in 2015 through an amfAR event at which proceeds from some auction items were earmarked for the ART. It is standard practice to not disclose the specific terms of agreements.”

The theater has no affiliation with Weinstein Live Entertainment. She declined to say whether ART thinks Cole should step aside from the board.

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