X-Message-Number: 1307
From: 
Subject: CRYONICS Re: Alcor Business Minutes
Date: Wed, 14 Oct 92 18:38:28 PDT

A response to the Alcor Business Minutes:

"     Michael Riskin read aloud his account of why he offered to audit the 
Alcor Endowment Fund, a task he completed in September."

I finally got a copy of his statement and have some comments that I think
the board should think about:

Obviously, Michael Riskin is correct that after the infusion of cash
from the Dick Jones' estate we are back to where we started.  I have no
disagreement with this fact.  Hey, I even passed around a Carlos memo
stating this fact at my last meeting attended and did not disagree with
Carlos about that at that meeting.  Unfortunately, Michael has missed
the big points which I was trying to draw attention to:

Point One:  If Alcor was really running a surplus as was promised the
infusion of cash would give us a total of 500,000 in our Endowment Fund,
not 400,000.  This 100,000 that we missed out on will prove to be sorely
missed in the near future as Alcor wishes that it had the interest on
100,000 to work with.

Point Two:  Since Alcor is only back to where it started after getting
the 100,000, this means that Alcor is running a substantial deficit.  This
deficit is large enough to be a major concern to Alcor.  I predict that
thanks to the smaller Endowment Fund than expected, Alcor will have a hard
time maintaining a balanced budget in the near future.

Point Three:  There is no question that monies were taken from the 
Endowment Fund before the Dick Jones money was decided by the board to
be part of the Endowment Fund.  By violating Alcor's word that only the 
Endowment's fund interest would be spent, Alcor has misled its members.
Particularly the ones who donated money to that fund.  Like me.

Point Four:  By not treating the Endowment Fund as an Endowment Fund, and
spending the principal as well as interest, Alcor has strongly discouraged
members from donating to that fund.

These four points are very important.  Michael Riskin's findings mainly
showed that the controls over the Endowment Fund were poor, including a
check being written out to cash.  While the controls are important, the
overall picture is even more important.

In conclusion, I accused Alcor of doing everything wrong to its 
Endowment Fund but embezzling it.  I believe that my accusations have 
proven to be correct.  I hope the current board does all it can to 
correct these problems.  

                                                               Eric Klien
 

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