American University President Resigns, Receives $3 Million Settlement

WASHINGTON

Two weeks after announcing that American University President Benjamin
Ladner was leaving following an investigation into his spending,
university trustees said Monday that Ladner has resigned and accepted a
$950,000 settlement.

Ladner, 63, was suspended in August while auditors examined at least
$500,000 in travel costs and other expenses that he and his wife
incurred over the past three years. The expenses in question include an
engagement party for Ladner’s son; “professional development” trips for
the couple’s personal chef to Paris, London and Rome; nearly $54,000 in
drivers’ costs; and nearly $44,000 in alcohol.

“The board felt it was in the best interests of the entire university
community to put the controversy surrounding the Audit Committee’s
investigation and Dr. Ladner’s employment behind it,” said acting
chairman Thomas A. Gottschalk.

Ladner had led the 11,000-student private school in Northwest
Washington for the past 11 years. Cornelius M. Kerwin, 57, has been
acting president since Ladner was suspended.

The board did not address a severance package during a daylong, Oct. 14
meeting when it decided he would not return. Since then, many students
and faculty members have been protesting any payment to Ladner.

According to terms released by the board on Monday, the university will
deduct from Ladner’s settlement withholding taxes on $398,000 in
questionable spending that the university reported to the IRS as income
for the years 2002-2005. It will also deduct $125,000 in personal
expenses that the board wants repaid.

Ladner will also receive deferred salary that he had previously earned
and set aside, the board said, including an insurance policy worth $1
million and the balances of two trusts worth about $1.75 million.

Ladner agreed to drop any other claims against the university arising from his contract.

Some faculty members were dissatisfied.

“We condemn the decision of the Board of Trustees to offer former
President Ladner a multimillion-dollar settlement package and the
closed process by which that decision was reached,” the university’s
deans said in a statement released Monday night.

— Associated Press



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