Dear members of the Board of Governors of York University,
I’m a Liberal Arts & Professional Studies alum, and I valued my time at York. It pains me that cancelling my monthly donation feels like the right thing to do.
In October 2015, Canadian billionaire Victor Dahdaleh made a $20-million donation to York that will fund a new academic building, to be named after him. In May 2016, the Toronto Star and the CBC completed their joint investigation into the Panama Papers, a giant collection of leaked documents relating to offshore companies. The investigation confirmed long-standing allegations against Dahdaleh: that he had been a central figure in an international corruption scandal, using shell companies and bribes to suck US$400 million out of the aluminum industry from 1989-2009.
I would have expected these revelations to change York’s plans. Instead, at the June 2016 convocation, York bestowed an honorary doctor of laws on Dahdaleh. He addressed the graduating class, encouraging them to be good citizens like him. York President Mamdouh Shoukri shrugged off questions of Dahdaleh’s suitability as a role model.
Continuing York’s friendship with Dahdaleh was a serious mistake. You’re the leaders of an influential Canadian institution, welcoming unfair markets and economic instability. Corruption stories may not move people, but Dahdaleh’s actions of foreign bribery, artificial markups, and money laundering are illegal for good reason. They damage economies, and ordinary people suffer the consequences, while billionaires like him leap to their next perch.
In October 2016, after criticism from York Senate member and economics Professor Ricardo Grinspun, Shoukri pointed out that Dahdaleh has never been convicted of a crime. From 2008-2014, Dahdaleh successfully fought a U.S. fraud lawsuit as well as U.K. criminal charges of corruption and money laundering, both related to this corruption scheme. His defence in the criminal case was based on century-old legislation around bribery of foreign officials, under which it didn’t count if the foreign government (in this case, Bahrain) approved of the bribe. Mistakes made by the U.K. Serious Fraud Office, as well as witnesses refusing to testify, contributed to his acquittal. The U.K. fixed the outdated law in 2010, too late to catch Dahdaleh.
So far, Dahdaleh has not been charged based on the new evidence in the Panama Papers, which includes emails confirming his identity as the middleman who facilitated millions of dollars in bribes paid by Alcoa, a global aluminum giant. In 2014, Alcoa pleaded guilty to corruption charges and paid US$384 million in fines.
The above should make clear the difference between legal and moral guilt. It’s obvious Dahdaleh should not go to jail unless convicted by the imperfect machinations of our legal systems. But it’s just as obvious he is not fit to be honoured by York, nor is it ethical to take his money. York has a responsibility to hold its friends to a higher standard than “not guilty”.
Yes, the decline in public funding is hard for all universities. But while $20 million is large for a private donation, it’s a morsel of York’s $1-billion annual revenue. Students themselves are the largest single contributor, paying $520 million in tuition fees last year. The province of Ontario provided $305 million for 2012-13 (the most recent data available). For two years in a row, York has posted surpluses on the same scale as Dahdaleh’s donation ($19.9 million for 2014-15, and $23.3 million for 2015-16). Refusing or returning his donation was feasible.
Moreover, cutting ties with Dahdaleh would have been best for long-term revenue. That $305 million from the people of Ontario didn’t come from some abstract notion of stimulating the economy. That’s the conventional argument for increased funding for universities, and it doesn’t work — the decline continues. The public will want to fund York if you can lead us to a more equal, sustainable future where we recognise ourselves better in our public policy. A healthy democracy needs leadership from universities on the murkiest ethical questions.
York does this on some level, with a variety of humanities programs and symposia such as October’s Re-imagining Refuge. But if this productive ethical questioning doesn’t go straight to the top, then it’s limited to the status of hobby. It should be York’s chief occupation, but your continued friendship with Dahdaleh shows it isn’t. As you abandon ethical questions at the executive level, public funding becomes vestigial, and will eventually wither completely. Without public funding, a university is not a university. It’s a private school for management elites, a corporate research lab, a think tank.
Last spring, as two reputable, national publications confirmed Dahdaleh’s wrongdoing, you had an opportunity to fight this trend. It would have been inconvenient, but you would have been clearly in the right. As you consider who your next president will be, I urge you to choose someone who will do better. Canada needs your leadership, and you need our commitment. Tentanda via.