Gramercy Park Block Association - Neighborhood News #40
Additional Media Coverage about Aldon James and the National Arts Club - DNAinfo, The Daily News, The Real Deal, ARTINFO, CurbedNY, Nearsay
Additional Information from DNAinfo:
National Arts Club President Aldon James Steps Aside
By Amy Zimmer
DNAinfo News Editor
Aldon James' tenure has been rife with battles, including fights with tenants in the club's apartments over rent stabilization, rifts with Gramercy Park locals over access to the gated green space and challenges from members trying to pry open the club's operations.
The club also faced a Manhattan District attorney investigation that resulted in a 2003 guilty plea of his twin, John, for using the club's nonprofit tax status to buy jewelry he sold for personal profit.
John James served five years probation and three months in a psychiatric hospital, and agreed to pay more than $500,000 in restitution and fines.
The club also had to pay $150,000 in back taxes on transient rooms it rented out, and its dining room manager pleaded guilty to sales tax evasion, paying back more than $275,000.
Aldon James railed against alleged mismanagement of the club by his own predecessor when he came to power 25 years ago - accusing the prior arts club president of keeping the club's finances a mystery to members and accusing her of racking up enormous travel expenses.
Now James' practices have attracted scrutiny - including a $37,000 tab for club travel expenses, according to tax filings. Independent audits of the institution obtained by DNAinfo also reveal concerns by auditors that the club has been operating under lax fiscal oversight.
The 2010 draft independent audit report by O'Connor Davies Munns & Dobbins found several red flags in the club's financial behavior, including the practice of leaving blank checks unsecured and failing to sufficiently monitor the club's debit card, enabling one employee to use it to rack up $21,000 in personal expenses before the board became aware of the problem.
Experts said board members of nonprofit organizations chastised by an independent auditors should take heed.
"If an independent audit points out financial improprieties, there would be an affirmative duty of the board to create a compliance system," said Jill Manny, NYU Law Professor who heads that school's National Center on Philanthropy and the Law. Manny declined to speak specifically about the National Arts Club, but agreed to speak about the general law.
Gregg Fisher, founder of investment and tax management firm Gerstein Fisher, who sits on another nonprofit board, said insurance wasn't enough to shield board members in cases of mismanagement.
"A lot of boards have insurance to protect themselves, but there's still liability. They're still at risk," Fisher said, speaking generally about nonprofit law.
He added that if an independent auditor pointed out problems in management, board members "better explore it and keep good notes," because "this is a core function of the board, particularly where directors have been made aware of improprieties in the past."
The 2010 audit found that the club ignored its own stated financial procedures, including requiring two signatures on checks of more than $10,000. It also found that the board cut handwritten checks with little to no backup information about their destination.
"As in previous years, we again noted a high number of handwritten checks, some with no support or back up," the auditors wrote. "We highly recommend that this practice be discontinued and all checks be generated from accounts payable."
Auditors also decried the club's habit of leaving checkbooks unguarded, sometimes in an unlocked drawer, as the practice "creates the possibility that a blank check could be taken by an unauthorized individual and then executed and presented for payment."
The club's management promised auditors last year that they would correct the problem.
A spokesman for the club did not return repeated requests for comment.
One ex-board member, who recounted that the board did not look at the "nitty-gritty" financial details, explained that board members were uncomfortable with the limited financial information to which they were given access.
"I was worried when I was on the board, the board would get sued for malfeasance or misappropriation of funds," said the former member, who asked not to be named, for fear of retaliation.
But he said he and his former colleagues would brush away the concerns, because "The responsibility is spread out among a lot of people who think 'Why should I stick my neck out when Aldon will cut it off?' People get shunned if they speak out."
Aldon James, president of National Arts Club, steps aside for 'well-earned vacation'
BY CORKY SIEMASZKO DAILY NEWS STAFF WRITER
Tuesday, March 15th 2011, 11:15 AM
Aldon James, who ran the club for a quarter century, exited about a week after dozens of dead or disoriented baby finches were found dumped across the street from the club in private Gramercy Park.
Aldon James, the bird-loving, feather-ruffling president of the prestigious National Arts Club, has flown the coop.
Battered by a spate of eyebrow raising reports about his behavior and management of the venerable Gramercy Park institution, James stepped aside for a "well-earned vacation."
"President Aldon James has requested that the board of governors spend the next couple of months looking into how we can improve our operational structure," the club said in a statement released Monday. "In his absence Dianne Bernhard, first vice-president, will be acting president."
James, who ran the club for a quarter century, exited about a week after dozens of dead or disoriented baby finches were found dumped across the street from the club in private Gramercy Park.
The self-proclaimed "Bird Man of Gramercy Park," famous for the array of birds he kept in his apartment, made conflicting statements about the finches - first denying he had bought any from a breeder before later confirming he got about "four dozen."
"The rumor that I released these birds in the park is not true," James told The Daily News when the story broke. "I did not release these birds."
James did not immediately return a call for comment about his exit, but the bird episode appeared to be the final straw for Bernhard and the other board members.
An arts maven, James is credited with revitalizing the once-stodgy club after taking over in the 1980s. The 113-year-old club boasts members like filmmaker Martin Scorsese and actors Ethan Hawke and Uma Thurman.
In January, The Daily News reported that the club was paying its dining room manager a $247,000 salary - even though he was caught stealing thousands at the club.
Joseph Frappaolo, whose salary was set by James, pleaded guilty in 2002 to skimming more than $160,000 in state and city sales taxes.
James' twin brother, John, was also a crook. He pleaded guilty in 2003 to misusing the club's tax-free status to peddle millions of dollars worth of jewelry.
Despite that, John James was allowed to rent an apartment in the club's building for just $356 a month - well below the market rate.
James, who does not draw a salary, and several other club trustees also occupy reduced-rate apartments in the landmark Tilden Mansion.
The club got more unwanted media attention last year when fire inspectors slapped it with a violation after they found hallways and exits blocked by junk.
National Arts Club president steps aside following dubious rentals at Gramercy clubhouse
March 15, 2011 11:00AM
Embattled National Arts Club President O. Aldon James has gone on hiatus, after weeks of embarrassing accusations against him emerged, including claims that he hoarded personal belongings in the organization's tony clubhouse at 15 Gramercy Park South and offered discounted rents and sweetheart deals to friends living there. James, who has vehemently denied the allegations, announced his leave of absence last night, according to the New York Times, roughly a week after dozens of young finches were found dead in Gramercy Park, purportedly released into the wild by James, a well-known avian aficionado. Dianne Bernhard, the new acting president, said that the bad publicity James generated wasn't going over well with the board of governors. "We've had a barrage of newspaper articles, complaints from board members, members, tenants, staff [and] neighbors," Bernhard said. "We felt like there was so much information out there that we didn't know which was fact and which was fiction, and we needed to get to the bottom of it." James argued earlier this month that the accusations against him, including claims of nearly 50-percent rental discounts given to friends at 15 Gramercy Park South, had been concocted by "several governors who want to be the boss and not lead through constructive discussion." James' hiatus is expected to last for a "couple of months," according to a National Arts Club statement obtained by DNAinfo. [NYT] and [DNAinfo]
From left: National Arts Club President Aldon James and Dianne Bernhard, who is taking over in his absence.
National Arts Club Board Sends Its President on "Vacation" Amid Swirl of Bizarre Occurrences
Courtesy AFP/Getty Images
Published: March 15, 2011
NEW YORK- Following an emergency board meeting at the National Arts Club on Monday, Aldon James Jr., the eccentric, red-tinted-glasses-sporting bon vivant who has been president of the Gramercy Park institution since the mid-1980s, is set to take a hiatus. The club's vice president - and now acting president - Dianne Bernhard has dubbed his time away from the club a "leave of absence," and a statement from the board calls it a "well-earned vacation." The city's bird population, meanwhile, continues to follow the situation closely.
The announcement of James' time off, reported by the New York Times, comes on the heels of strange stories and rumors that have emerged in the past few weeks concerning the 63-year-old president and his twin brother, John T. James. Last week, the New York Daily News reported that Aldon James may have released a flock of baby finches into to private park across from the club, where many of the birds then perished. While the 63-year-old club president initially denied that he had released the birds - calling the situation an "Agatha Christie mystery" - a breeder tracked down by the News confirmed that he had sold the James some 50 Australian zebra finches the previous week. The American Society for the Prevention of Cruelty to Animals is conducting an investigation.
James has also recently been accused by certain members of his board of hoarding a bevy of flea-market finds in the rooms of the historic club - whose early members included Woodrow Wilson, Theodore Roosevelt, and Daniel Chester French - and of housing his friends and brother in the club's upstairs rooms for below-market rates.
Other recent scandals at the century-old club include the dining room manager's embezzlement of $163,000 in 2002, and a 2003 incident in which John T. James misused the institution's tax-exempt status to buy jewels, which he then flipped for a profit, according to the Times. Earlier this month, the same James brother managed to leave $100,000 in art, jewelry, and cash in a cab. When the taxi driver, Zubiru Jalloh, returned the loot, John T. James decided to host a party at his brother's club in the cabbie's honor - but nobody remembered to invite Jalloh.
"We've had a barrage of newspaper articles, complaints from board members, members, tenants, staff neighbors," Bernhard told the Times. "We had disgruntled employees who were fired, and this last episode of the birds in the park. We felt like there was so much information out there that we didn't know which was fact and which was fiction, and we needed to get to the bottom of it."
PROBLEMS ON THE PARK
Tuesday, March 15, 2011, by Joey Arak
It looked like longtime National Arts Club President Aldon James would survive allegations of hoarding and misappropriating the apartments in the storied Gramercy Park clubhouse, but in the end, the dead birds did him in. The colorful James has taken a leave of absence from the club while the board figures out what the heck is up with this guy after he was connected to dead finches left in and around Gramercy Park. Did he have to surrender his key to the park like some hot-headed detective giving up his gun in a cop movie? [NYT; previously]
Sarah Rahman - NS Newsdesk Tue, 03/15/2011 - 09:16
National Arts Club President Aldon James Takes Time Off
The Wall Street Journal
National Arts Club President Aldon James deserves a "well earned vacation," according to his colleagues, and so, he has no choice but to take one. After holding an emergency meeting Monday night, the club's vice president, Dianne Bernhard, was named as acting president while James, president of 25 years, was on a "leave of absence," according to The New York Times.
The meeting was called not only because of the finches, but to counter all the media coverage, Bernhard told The New York Times.
"We've had a barrage of newspaper articles, complaints from board members, members, tenants, staff neighbors," she said. "We had disgruntled employees who were fired, and this last episode of the birds in the park. We felt like there was so much information out there that we didn't know which was fact and which was fiction, and we needed to get to the bottom of it."
James, no stranger to controversy, has come under heat for allegedly using club apartments to not only store antiques and art he bought at flea markets, but renting apartments out to himself, his brother and a family friend at below-market rates.