'Sloppiness,' Not Wrongdoing, Led to Probe, Says WNET Chair

This article was originally published in Current, on Monday, Sept. 21, 2009.

By Katherine Reynolds Lewis

The leadership of WNET said a federal investigation into the station's use of federal grants totaling almost $13 million is wrapping up, and the organization is financially sound.

"There was sloppiness as opposed to real wrongdoing in terms of our accounting systems, which has been addressed," said James Tisch, chairman of the WNET Board, in an interview.

The station has hired a new chief financial officer and created the position of executive director, financial control, to ensure compliance with federal grant rules, said Neal Shapiro, president.

"We have a new CFO. We have a new compliance person to make it very clear we take all these rules very seriously," Shapiro said. "The systems we've put in place, the people we've hired, will make us a stronger institution."

The federal probe, reported last week by Crain's New York Business, is looking into whether the station's use of federal grant money violated federal civil statutes and is likely to be referred to the Justice Department's civil division, according to WNET.

"The grants at issue began in 2000 and include funds provided by the National Science Foundation for the animated children's math series Cyberchase," the station said in a statement.
"WNET.org's management, as a cautionary measure, elected to slow its draw down on certain grants by adding further compliance measures so as to be certain that there will be no accounting or compliance questions going forward. WNET.org and its subsidiaries continue to receive federal grants, including from NSF for Cyberchase."