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Financial Audit at James Beard Foundation Concludes
Former President Len Pickell Engaged in Improper
Use of Foundation Assets for Personal Benefit

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New York, NY (15 December 2004) - The James Beard Foundation, a national not-for-profit organization dedicated to supporting the culinary arts community, today announced the results of an independent financial audit conducted by Goldstein Golub Kessler LLP. Based on an earlier investigation and as referenced in the audit report, the Foundationís legal counsel determined that there was sufficient evidence to allege that the Foundationís former President, Leonard Pickell, engaged in inappropriate practices and improper use of Foundation assets for personal benefit. The New York Attorney Generalís Office took action with respect to Mr. Pickell earlier this week.

"It is clear that the Foundation has been harmed by these actions, which led to the unsubstantiated expenditures incurred by our former President," said George Sape, Chairman of The James Beard Foundation Board of Trustees and Managing Partner of Epstein, Becker & Green. "The Foundation has rapidly grown over the last twenty years and the Boardís focus was on raising money, which it did successfully. Although we were deceived and misled, in retrospect, we would have demanded better financial controls and reporting. Our former President, Len Pickell, who represented himself as a CPA, had principal responsibility for these functions. We regret that this happened and have taken immediate and appropriate action to ensure that it never happens again."

As stated from Note 7 of the audit report, "For the fiscal year ended March 31, 2003, the aggregate amount of the loss from unsubstantiated expenditures is being reported as $371,907, of which (i) $237,951 has been concluded in the Investigation to be improper, and (ii) $133,956 is considered likely of being deemed improper pending receipt of substantiation or other justification. The Investigation report concludes that losses of $373,251 for the fiscal year ended March 31, 2002 and $284,915 for the fiscal year ended March 31, 2004, are likely to have occurred, pending receipt of substantiation or other justification."

The Foundationís Board of Trustees and management will continue to cooperate fully with the ongoing investigation at the New York Attorney Generalís Office.

Summary of the actions taken and plans to ensure fiscal responsibility, organizational transparency and structural reform

The James Beard Foundation is financially solvent, with a sound balance sheet. The Foundation's Awards and Scholarships programs are moving ahead as planned, and events at the James Beard House continue to enjoy strong community support.

The James Beard Foundation Board of Trustees took action by:

  • Hiring law firm, who in turn, hired accountants in early May to perform investigative review
  • Retaining new auditors, Goldstein Golub Kessler LLP, to audit the Foundation's 2003 financial statements
  • Implementing a strict set of guidelines and review procedures for cash management and expense reimbursement
  • Appointing an Executive Trustee Committee to oversee restructuring of Board of Trustees
The Foundation's ongoing action plan includes:
  • Hiring an Executive Director for the first time in the Foundation's history
  • Instituting an ethics compliance policy for Board members, employees and volunteers
  • Making public subsequent financial reports to ensure transparency
  • Exploring the creation of a new structure to give the James Beard Foundation Awards more autonomy
About The James Beard Foundation
Based in New York City, The James Beard Foundation is a national not-for-profit organization dedicated to furthering the practice and appreciation of the culinary arts in America. In addition to presenting The James Beard Foundation Awards, the Foundation grants more than $250,000 in scholarships annually, holds special events at the historic James Beard House in Greenwich Village and around the nation, and maintains an archival culinary library. 

 
Contact:
The James Beard Foundation
167 West 12th Street
New York, NY, 10011
www.jamesbeard.org
Also See: Four Chefs from National Trust Historic Hotels of America Assemble American Cuisine Menu for James Beard House / Feb 2002
Chefs from Kessler Collection of Grand Theme Hotels Presenting A Taste of Florida Menu at the James Beard House / June 2003


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