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University foundation cleared of wrongdoing
AG recommends better financial management
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An investigation by the state Attorney General’s Office into the fund raising practices of the California State University, Stanislaus Foundation has cleared the charitable organization of any wrongdoing, but advised the board to implement steps to improve their financial management.


The investigation into the foundation was launched in April at the request of State Senator Leland Yee (D- San Francisco). Yee had been given a portion of a contract regarding Sarah Palin’s visit to the campus by students who claimed they found it in a Dumpster on campus. He accused the foundation of inappropriately using university staff and resources to help bring Palin to the campus for a fund raising event.


 Attorney General Jerry Brown agreed to investigate the foundation, including whether it was spending its money for the benefit of the campus as it promises its donors, the university and the public. Brown also investigated the refusal of CSU Stanislaus to turn over records regarding Palin’s appearance.


"We examined whether money given to a charitable foundation was handled appropriately, but found no violation of law," Brown said. "However, the foundation board has agreed to make changes to improve oversight of its funds."

Brown's Charitable Trusts Section found that the foundation exercised inadequate oversight of its $20 million in assets, but found no misuse of its funds and no violations of state law.


Brown's audit showed that the foundation's accounting procedures were inadequate; it failed to understand fully its duties and responsibilities under the law —  including basic charitable trust concepts — and it failed to implement its own auditor's recommendation to prepare a budget for all fundraising events.

 Prior to the Attorney General’s findings, the foundation had already implemented some new policies and procedures to provide more extensive board training and enhanced accounting practices, as well as increasing administrative oversight. 

“We appreciate the Attorney General’s review and had already been working to implement many of the recommendations,” said Russ Giambellucca, vice president for Business and Finance at CSU Stanislaus and treasurer for the foundation. “In the past, our foundation board was primarily focused on raising money for the university.  But over the past year, the board has been charged with providing more administrative oversight of all foundation activities and assets. We are pleased that the corrective actions required by the AG are consistent with the direction we’ve been taking already.”


To address the Attorney General’s findings, the CSU Stanislaus Foundation Board will: Continue to provide training to all current and future board members to assure understanding of their fiduciary duties under state law; implement independent auditor recommendations when received; routinely and consistently follow established fiscal and governance policies and procedures; and continue to assure that all relationships with professional fundraisers comply with the Government Code.

 “We feel really good that the review found no wrongdoings and that it has been closed, so that we can move on and continue the work the foundation has been doing to benefit the university and its students,” Giambellucca said.To contact Sabra Stafford, e-mail or call 634-9141 ext. 2002.