Controversy

02.13.12

Nancy Brinker: A Socialite, a Scandal, and a Mysterious Expense Report

The powerhouse founder of the embattled Susan G. Komen foundation, Nancy Brinker billed her charity for $133,507 in expenses when she had a full-time job elsewhere. In an exclusive report, Abigail Pesta and Aram Roston report on how her lavish spending and controversial leadership style alienated some staffers.

Nancy Brinker, a socialite, powerbroker, and former U.S. ambassador to Hungary, has turned Susan G. Komen for the Cure into a cancer-fighting giant over the past three decades. Now, critics say, it may be time for her to go—if she wants to preserve the very charity she built.

The recent crisis over Komen’s decision to de-fund—and then re-fund—Planned Parenthood has put Brinker under intense scrutiny, with observers questioning everything from her management style to her earnings to her spending. “It has all become a diversion. It has itself become cancerous,” says Eve Ellis, a former board member of Komen in New York City. “Nancy has accomplished so much and provides so many millions in research dollars, but the foundation needs to get back to being strong. For that to happen, she needs to step down.”

In interviews with The Daily Beast, a half-dozen former Komen employees who held a range of jobs at the charity in the past five years expressed similar sentiments, saying the foundation has become dominated by its larger-than-life leader. These people strongly acknowledge Brinker’s accomplishments, praising her immense skill at raising funds for lifesaving cancer research. At the same time, they describe her as an imposing figure who flies first class, prefers five-star hotels, and generally exhibits an entitled air, which, they say, is at odds with the organization’s important mission. Employees don’t call her “Nancy,” these people say. They are expected to call her “Ambassador Brinker.”

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In the 30 years since she launched the foundation, Brinker has raised some $1.9 billion for cancer research. More than 100,000 volunteers work in a nationwide network of affiliates. It was all Brinker’s vision—she started the charity after her sister, Susan G. Komen, died of breast cancer in her mid-30s.

Perhaps because of the charity’s huge success and its close association with Brinker’s vision, people are especially interested now, amid the brewing Planned Parenthood controversy, in its inner workings—particularly related to the founder.

Brinker, 65, earns more than $400,000 a year at Komen, a level of compensation that is in line with the pay for top officials at other major charities, according to observers of charitable institutions who pay close attention to numbers like these.

It is unclear how much the Komen foundation pays yearly for her travel expenses and other costs. The foundation declined to answer questions on the matter.

The Daily Beast found that Brinker billed the foundation for $133,507 in expenses from June 2007 to January 2009, according to her filings with the U.S. Office of Government Ethics. At the time, she was a full-time federal employee, serving as chief of protocol for the State Department. President Bush nominated her for the position in June 2007 and she held the job until January 2009.

The reason for the expenses was not included in that filing. Tax records filed by Komen for that year indicate that the expenses were approved by the board of directors because she was the founder of the organization. The money covered “speech-writing expenses, certain travel, and office costs,” as well as “office personnel work,” according to the filing, which didn’t go into specifics.

Rick Cohen, who analyzes nonprofit management for the journal Nonprofit Quarterly, says the arrangement leaves some questions unanswered. “If she was paid $133,000 for expenses related to Komen while she was working full time for the federal government, that is a distinctly unusual situation,” he says. Cohen explicitly said he sees nothing illegal about the arrangement; rather, he said, Komen should have disclosed more specifics about the reimbursement so as to avoid a perception problem.

The Komen foundation declined to comment on the $133,507 expense payment and on the workplace culture at Komen. In response to queries, the foundation issued a statement, saying in part, “This is the most successful grassroots organization fighting against breast cancer in history, and it continues to be amazingly effective at its core mission,” which involves “tapping everything we can to find a cure.” The statement also said that Komen acknowledges it “made a mistake by getting mixed up in a political issue,” referring to the Planned Parenthood flap. “We truly regret it and will not repeat it.”

Brinker is an independently wealthy woman, due in part to a divorce from multimillionaire restaurateur Norman Brinker in 2003. She splits her time between her residence at the Ritz-Carlton in Washington, D.C., and at her home in Palm Beach, Fla. She is herself a breast-cancer survivor and a former U.S. ambassador to Hungary, a role she held from 2001 to 2003.

Her supporters are quick to note the important work she has done at Komen. “They give more funds to research grants than any other organization outside of the National Cancer Institute,” says a senior cancer researcher with close ties to Komen, adding that he’s “terrified” about the effect the controversy over Planned Parenthood could have on funding. Komen contributed $66 million to research grants and $93 million to community-health programs last year.

As arguably the single most public face of breast-cancer awareness, Brinker has demonstrated an ability to deliver her important message. Her pink-ribbon walks and runs have inspired a legion of loyal activists. She also knows how to make people laugh. At a 2009 dinner with magazine editors at the trendy Manhattan restaurant STK Market, one attendee recalls, she joked that for women, sex with older men is not so great, because the Viagra means the guy never stops.

Still, the perception that she could be taking liberties with charity funds could be troublesome, some observers and former colleagues say.

At the Komen foundation, as the chief executive officer and founder, Brinker is approved for first-class travel, according to the foundation’s tax records.

Cohen of Nonprofit Quarterly points out that first-class travel at a nonprofit organization not only is unusual, but also can create the perception that donors’ dollars aren’t reaching the intended beneficiaries. “For most nonprofits, they wouldn’t think of first-class travel,” he says. “There is the issue of perception.”

Employees don’t call her “Nancy,” former colleagues say. They are expected to call her “Ambassador Brinker.”

Says one former employee: “How many mammograms could you buy for those first-class tickets?”

After Brinker’s term in the State Department ended in 2009, she returned full time to Komen. Her return coincided with a cultural shift within the foundation, former employees say. She was more distant and aloof, these people say. “It was like suddenly she expected someone to carry her purse,” says one person.

In a move that brought some ridicule in the press, the foundation began collecting names of smaller charities that used the phrase “For the Cure”—which is part of the Komen foundation’s own name—in order to pursue legal action over the copyright. Komen asked a lung-cancer group that ran events called Kites for the Cure to change the name, according to a report in The Wall Street Journal. Another group, Mush for the Cure, which ran dog-sledding events, was also asked to change its name, the group says on its website. In the end, Mush kept its name, and Kites kept its name for certain events.

At the Komen foundation, management turned over fairly rapidly from 2009 to 2011, at considerable expense to the foundation.

Brinker took over as chief executive of Komen in 2009, replacing Hala Moddelmog, who received $277,000 in compensation after she left, according to tax records. Moddelmog didn’t return calls for comment.

That same year, Brinker hired Jennifer Luray to head up governmental affairs and public policy. In 2010, Luray left, receiving more than $300,000 in salary and severance for the year, according to tax records. Luray didn’t return calls for comment.

In 2011, Karen Handel took over governmental affairs and public policy. Handel acknowledges that she recommended the decision to cut funding to Planned Parenthood, amid pressure from Komen donors and from Komen management itself to find a solution. The uproar that erupted this month took the Komen foundation by surprise, Handel says, with the backlash prompting the charity to reverse its decision.

This past week, Handel stepped down. But not quietly. In an interview with The Daily Beast last Thursday, she blasted Planned Parenthood, saying the group orchestrated the media firestorm—an allegation Planned Parenthood denies.

Handel herself strongly defends Brinker against the critics. “Her organization has done more to move the fight against breast cancer forward than any other organization,” she tells The Daily Beast. “This organization is, in very large part, her. She is the organization.”

She adds, “My sincere hope is that when the shrillness of the issue begins to subside, logic will prevail.”