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University To Review HIID's Operations

By Matthew W. Granade

The University will conduct a "management review" in several areas of the Harvard Institute for International Development (HIID), during the coming months, Mass. Hall officials confirmed yesterday.

HIID, a Harvard think tank that aids foreign countries in their economic development, has been embroiled in controversy since June when the U.S. government accused two institute officials who worked on projects in Russia of misconduct.

"We don't have any other allegations involving any other individuals in HIID but the management policy and practices are something the firm would look at," James H. Rowe III '73, vice president for government, community and public affairs, said yesterday. "It's premature to say what the scope of the review will be."

Rowe refused to say whether the review would be limited to HIID's activities in Russia.

Harvard has not yet determined who will conduct the review, but officials have begun discussion with various firms including Coopers and Lybrand, Rowe said.

The University has also retained Covington and Burling, a Washington law firm, to assist HIID with the government's inquiries.

One high ranking Mass. Hall official described Covington and Burling's work and the management review as an "internal investigation," but Rowe denied this description.

"I want to underscore that Covington and Burling is assisting us in our review by the government. We did not hire them to do an internal investigation," he said.

HIID Director Jeffrey D. Sachs said he was unaware of any form of internal investigation.

"We are only cooperating with an on-going investigation by the government," he added.

On May 20, U.S. Agency for International Development (USAID) sent Sachs a letter suspending a $14 million contract with Harvard for development work in Russia. The letter accused Andrei Shleifer '82, the project director who is also professor of economics, and Jonathan R. Hay, the project director in Russia, of violating USAID's conflict of interest policies.

On June 6, USAID terminated the HIID's Russian contract. The government's investigation is on-going

The University has also retained Covington and Burling, a Washington law firm, to assist HIID with the government's inquiries.

One high ranking Mass. Hall official described Covington and Burling's work and the management review as an "internal investigation," but Rowe denied this description.

"I want to underscore that Covington and Burling is assisting us in our review by the government. We did not hire them to do an internal investigation," he said.

HIID Director Jeffrey D. Sachs said he was unaware of any form of internal investigation.

"We are only cooperating with an on-going investigation by the government," he added.

On May 20, U.S. Agency for International Development (USAID) sent Sachs a letter suspending a $14 million contract with Harvard for development work in Russia. The letter accused Andrei Shleifer '82, the project director who is also professor of economics, and Jonathan R. Hay, the project director in Russia, of violating USAID's conflict of interest policies.

On June 6, USAID terminated the HIID's Russian contract. The government's investigation is on-going

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