Alum Donor Blasts HMC

A significant Harvard donor has demanded a public airing of the books at the Harvard Management Company (HMC) and said he will sue for the information if his demands are not met.

Terry M. Bennett, whose $4-million donation to the University in 1991 continues to grow in a protected trust, issued a brazen ultimatum in a letter to University President Lawrence H. Summers last month threatening litigation.

“I’ve never had an answer from Larry Summers, and I expect I never will, unless I subpoena his sorry ass,” Bennett said.

University officials were dismissive of Bennett, whose letter to Summers promised to launch a “raging scandal,” but they declined to comment on the specific situation.

In a vituperative three-page screed interspersed with capital letters and an 85-word run-on sentence, Bennett called for immediate transparency at the HMC and a full accounting of fund managers’ salaries. The HMC said last month its six highest-paid managers received more than $100 million in salaries and bonuses last fiscal year.

“You need ten or more generous $4 Million guys, just like me, every year, just to pay the salary of ONE of these pigs, and I don’t know how many of them are lined up at the trough because you/Harvard are keeping it all a deep dark secret,” wrote Bennett, who graduated from Harvard Medical School in 1964 and the School of Public Health in 1969.

And while Bennett’s exact numbers appear dubious—the top fund manager at HMC received $35.1 million last fiscal year—his dissent joins those of other vocal donors who have questioned the HMC salaries.

Seven members of the Class of 1969 wrote Summers at the end of last year to protest the unusually high wages, and one of the signers, William A. Strauss ’69, said yesterday that other graduates had since followed suit.

Bennett’s original $4-million gift, financed by the sale of his antique automobile collection in 1991, was placed in an HMC-managed charitable remainder unitrust, which pays a donor a fixed percentage of the trust each year for the rest of the donor’s life. Bennett was slated to receive five percent of the trust annually, with the entire trust going to Harvard upon his death.

But Bennett, 65, said he consistently received less than five percent each year, and the trust grew to just $5.1 million by 1999. When Bennett raised questions at that time, the HMC resigned as the manager of his trust. Morgan Stanley took over the management of the trust, though Harvard remains the beneficiary.

HMC President Jack Meyer declined to comment on Bennett’s claims yesterday.

Bennett, who said he donated the money to alleviate the tuition debt of Medical School students, said he has considered suing to remove Harvard as the recipient of the trust on charges of “fraud and misrepresentation,” although the bar for such claims is very high.

“It’s possible that there is such a claim to be made,” said Peter D. Anderson, Bennett’s attorney.

Corey D. Welford, a spokesperson at the Massachusetts Attorney General’s office, confirmed Anderson and Bennett have contacted the charities division there.

Following Sept. 11, 2001, Bennett gained moderate fame as the former personal doctor for the bin Laden family.

Bennett has often found himself in court—or threatening to go there—to sue others, and his charges against the University appeared motivated as much by personal fury as legal standing.

“I’m basically a haggler by nature,” he said. And he wrote to Summers, “I am a very bad guy to cross.”

—Staff writer Zachary M. Seward can be reached at seward@fas.harvard.edu.