Getty Trust faces warning over governance

The U.S. umbrella group for non-profit foundations has placed the J. Paul Getty Trust on 60 days probation over allegations of financial misconduct.

The trust, one of the world's richest art institutions, runs the Los Angeles-based Getty museum, a research and conservation institute and the Getty Foundation, which issues grants for art projects around the world.

The warning by the Washington, D.C.-based Council on Foundations carries no finding of wrongdoing, but is notice that the trust is "not in good standing," council president Steve Gunderson said on Wednesday.

"It's like saying, 'You're on watch. Your conduct is of question,'" Gunderson told Reuters. "We have found evidence to date of the allegations to be sufficiently serious that the board felt some action was appropriate."

The Getty's probation was the first ever imposed by the council, acting under a new ethics policy adopted last year.

Recent news reports have accused Getty chief executive Barry Munitz of inappropriate use of funds and questioned the sale of Getty property to Los Angeles billionaire Eli Broad.

The council said it was attempting to examine the allegations against the Getty, but that the trust had failed to send information the council has requested since June.

Legal problems mount

The Getty museum is already under fire from Italy over its collection practices. Former curator Marion True is on trial in Rome on charges of conspiring to receive stolen artifacts.

The California attorney general's office also is investigating both the Getty's financial practices and its collection of antiquities.

The council said it was aware that the Getty was under pressure to deliver information to both Italian authorities and the attorney general's office.

But it issued a statement saying serious charges had been made against the Getty "related to the sale of Getty property, the use of foundation assets for personal benefit, excessive travel and entertainment expenses, inappropriate compensation for the foundation's CEO and potential self-dealing."

Some of the allegations stem from reports in the Los Angeles Times earlier this year that tax-exempt funds of the trust were misused by Munitz for lavish travel and other perks.

The council demanded the trust provide the information requested, establish a plan to prevent further abuses and address governance issues on its board of directors.

Getty has own inquiry

Getty spokesman Ron Hartwig said the institution was "working with the council to address its questions and we look forward to co-operating with them and to reaching a satisfactory outcome."

The Getty's board of directors is conducting its own inquiry into the use of trust funds, he said.

There also have been questions about True's financial dealings at the Getty, including a loan she acquired last year from a Getty supporter. True has since resigned as curator and is now on trial in Rome.

Italian authorities have questioned the origin of more than 42 archeological treasures in the Getty's collection. In an effort to appease Italian authorities, the museum recently agreed to return three disputed artifacts to Italy.