FORMER NYU FINANCE DIRECTOR IS SENTENCED AFTER STEALING $3.5 MILLION

Former NYU finance director has been sentenced to five years probation
Cindy Tappe used her position to divert money intended for businesses
The 57-year-old pleaded guilty to grand larceny in February

The former finance director at New York University who committed $3.5 million worth of fraud targeting minority and women-owned businesses has been sentenced to five years probation.

Cindy Tappe, of Westport, used her position at the Manhattan school to divert money intended for businesses with the fraudulent scheme.

The 57-year-old pleaded guilty to grand larceny on February 26 and has paid back $663,209 in restitution, with the final check for $180,000 received on Friday ahead of her court appearance.

She was sentenced to five years of probation by Judge Marisol Martinez Alonso at New York Supreme Criminal Court.

Tappe improperly routed $3.3 million to two shell companies she created while serving as director of finance and administration for NYU's Metropolitan Center for Research on Equity and Transformation of Schools.

She used the public money she stole to help fund her lavish lifestyle and $660,000 in renovations at her Connecticut home including an $80,000 swimming pool.

But some of the diverted funds were used to cover NYU-related expenses, including employee reimbursements.

The money was linked to $23 million in state Education Department grants awarded to the Metropolitan Center between 2011 and 2018.

Tappe's defense attorney Deborah Colson previously said her client has accepted responsibility, 'strongly regrets her misconduct' and planned to pay the required restitution in full prior to her sentencing.

'After that, she looks forward to putting this case behind her,' Colson said in a statement. NYU said its internal audit office had investigated Tappe and turned over its findings to state officials, leading to the criminal charges.

'We are deeply disappointed that Ms. Tappe abused the trust we placed in her in this way; she stole from everyone — the taxpayer, the University, the people the Metro Center is supposed to help,' university spokesperson John Beckman said.

'NYU is pleased to have been able to assist in stopping this misdirection of taxpayer money, and glad that the case has been brought to a close.'

Tappe was put on leave from her new job at Yale in December 2022, after being indicted for embezzling millions in funding for the Manhattan school on personal expenses.

She had since started work as an operations manager at the Yale's School of Medicine, but was suspended after staffers learned of the charges. '

In 2022, Tappe pleaded not guilty to using the stolen money to fund what prosecutors labeled a 'lavish lifestyle'.

Billed as having 'excellence in the comprehensive knowledge of financial and grants and has effective leadership and team-building skills' on the Yale website, Tappe faced six counts of money laundering, grand larceny, and fraud for the alleged six-year scheme, and was released at the time without bail.

A spokesperson for Yale - situated in New Haven, not far from Tappe's two-acre, multimillion-dollar property in Westport - confirmed then that 'Ms. Tappe has been placed on leave,' but would not specify whether that leave was paid or not.

The elite school - which employed Tappe as an operations manager in 2018 despite staffers at NYU at that point uncovering her alleged misdeeds - insisted in a statement that Tappe was vetted before being hired.

Following her indictment, NYU spokesman John Beckman said the school - which reported Tappe’s scheme to police upon uncovering it in 2018 - was 'deeply disappointed that an employee abused the trust we placed in her.'

Beckman said that the school discovered the 'suspicious activity' from their senior staffer in 2018, leading to Tappe to hand in her resignation after being confronted.

'We are pleased to have been able to assist in stopping this misdirection of taxpayer money,' Beckman said Monday.

In court, New York State comptroller Thomas DiNapoli asserted that Tappe stole the money to 'fund a lavish lifestyle.'

Both DiNapoli and Manhattan District Attorney Alvin Bragg, alleged she concocted her scheme over six years from 2012 to 2018 with an elaborate system of shell companies to steal the cash.

According to Bragg's office, Tappe funneled the money - rung from $23 million in grant money awarded to an NYU center where she worked - using two companies she constructed, as well as by drafting false invoices for three subcontractors, who received a three to six percent cut for no-show jobs without doing the work.

The cash was to be spent on controlling two state programs: one to assist school districts in improving results for students learning English, and another to ensure that students in special education received fair treatment.

Under the terms of the grants, a certain percentage had to go to women- and minority-owned businesses, which would then administer those programs.

Tappe took the $3.5million, and instead of distributing it, sent it to the small group of subcontractors, who took a small cut and then sent roughly $3.4 million to the shell companies that she created.

Using those shell companies - High Galaxy and PCM Group - she then spent the money, including the hundreds of thousands of dollars that went to her own personal expenses.

A program director learnt of the scheme in 2018, and confronted her.

'Our multilingual learners and students with disabilities deserve top-notch services, and these funds should have gone directly to their schools,' said Bragg.

'Instead, we allege, the funds meant for student programs were used purely for personal gain by an NYU Director of Finance, who renovated a home in Connecticut and bought a swimming pool with the money.

'This $3.5 million fraud also negatively impacted our city's minority and women owned business enterprises by denying them the chance to fairly compete for and secure the funding.'

She emailed the directors and told them that the school had 'developed good working relationships' with the companies - but she was ultimately fired, and the case referred to DiNapoli's office.

NYU, meanwhile, maintains they were and are 'deeply disappointed' that a staff member could act in such a way.

The school added that when confronted, Tappe misled school officials about her relationship with the subcontractors and shell companies, before ultimately leaving the school.

The missing funds were then reported to Manhattan's DA office, who launched a three-year investigation culminating in Tappe's arrest in 2022.

The probe, prosecutors said, determined that the fraud began in 2012 when Tappe was promoted to director of finance and administration at NYU's Metropolitan Center for Research on Equity and Transformation of Schools, and persisted until school officials confronted her in September 2018.

2024-04-26T16:43:46Z dg43tfdfdgfd