Former New York University Director of Finance and Administration Cindy Tappe is accused of orchestrating a $3.5 million fraud over the span of several years and is facing charges.
Yale University officials said Tappe, who was most recently the director of operations there, has been placed on leave following her indictment.
The Manhattan District Attorney's Office said the 57-year-old coordinated a six-year fraud in relation to two NYU programs. Authorities said she abused her position to divert roughly $3.5 million intended for minority and women-owned businesses.
Tappe is accused of routing the money to bank accounts held by two shell companies that she created. The Manhattan District Attorney's Office said she used some of the funds for university payments and employee reimbursements, but kept more than $660,000 for herself.
With that money, Tappe allegedly renovated her Connecticut home and purchased an $80,000 swimming pool.
Tappe served in her role at NYU from February 2012 to December 2018. During that time, she arranged for three subcontractors to receive the majority of the $3.5 million. Those contractors acted as pass-throughs, taking a small percentage as "overhead" and sending the remainder of the money to two fraudulent shell companies, authorities said.
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The two companies were called High Galaxy Inc. and PCM Group Inc. An NYU program director asked Tappe about the payments being made to these subcontractors in 2018, and she falsely claimed that the university had developed good working relationships with these companies, according to court documents.
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Shortly after, NYU reported the theft to the New York State Department of Education. They then reported the incident to the New York State Comptroller's Office.
Manhattan District Attorney Alvin Bragg said the multi-million-dollar fraud "negatively impacted the city's minority and women-owned business enterprises by denying them the chance to fairly compete for and secure funding."
“Our multilingual learners and students with disabilities deserve top-notch services, and these funds should have gone directly to their schools,” Bragg said.
Tappe faces charges including first-degree money laundering, second-degree money laundering, falsifying business records, and more.
