- Associated Press - Thursday, April 5, 2012

HELENA, MONT. (AP) - “Three Cups of Tea” author Greg Mortenson will remain the face of the charity he co-founded, despite his having to repay $1 million after an investigative report released Thursday concluded he mismanaged the organization and misspent its money.

Central Asia Institute Interim Executive Director Anne Beyersdorfer said Mortenson will continue to draw a salary from the charity. But it won’t be as executive director and he is barred from being a voting member of the board of directors as long as he is still employed by the organization.

A new title has not been created for the mountaineer and humanitarian, but he will continue to represent the organization in speaking engagements and work to build relationships in Pakistan and Afghanistan, where the charity builds schools and promotes education, she said.

“He’s the heart and soul of the organization,” Beyersdorfer said. “He’s the co-founder and I think we all think of him as our chief inspiration officer.”

A yearlong investigation by the Montana attorney general, who oversees charity organizations operating in the state, found Mortenson exerted tremendous control over the charity as tens of millions in donations poured in after the 2006 release of “Three Cups of Tea.”

Mortenson’s best-seller and a follow-up book, “Stones Into Schools,” came under scrutiny last year when reports by “60 Minutes” and author Jon Krakauer alleged the CAI co-founder fabricated parts of both and that he benefited financially from the charity. The attorney general’s probe focused only on the charity’s finances and operations, and did not examine the books’ contents.

The investigation found Mortenson had little aptitude for record keeping or personnel management, resulting in still-unknown amounts of cash earmarked management costs or wired overseas for projects without receipts or documentation on how that money was actually spent, the report said. The two other board members were Mortenson loyalists who generally did not challenge Mortenson, and he resisted or ignored CAI employees who questioned his practices, it said.

Mr. Mortenson may not have intentionally deceived the board or his employees, but his disregard for and attitude about basic record keeping and accounting for his activities essentially had the same effect,” Attorney General Steve Bullock said.

The charity’s mission is good and its financial situation is strong, Bullock said. CAI took in $72 million in donations from 2003-2011 and still has more than $23 million in reserves.

Though no criminal wrongdoing was found, CAI needs better oversight so one person does not hold too much control, the report concluded.

Mortenson declined comment through Beyersdorfer because of a separate civil lawsuit challenging the content of his books that is still pending. Penguin spokeswoman Carolyn Coleburn said the publisher had no comment on the report.

At least one Central Asia Institute donor said the findings would not undermine his support of the organization. Don Hammel, a retired real estate agent in Omaha, Neb., said he believes that the problem was Mortenson’s “fuzzy math” and not the charity’s mission to educate more people, especially girls.

“I am pleased with what he has accomplished there and know after he repays what the `Bean Counters’ fret about his Mission will go on,’” Hammel said in an email response to an Associated Press query.

“Three Cups of Tea” details how Mortenson resolved to build schools in Central Asia after he became lost and wandered into a poor Pakistani village, then follows him as he expands his school-building efforts there. The book was originally conceived as a way to raise money and tell the story of the Central Asia Institute, which Mortenson founded in 1996 with a $1 million donation from Dr. Jean Hoerni, a Swiss physicist and mountaineer

The book released in 2006 and tireless promotion of the charity by Mortenson, who appeared at more than 500 speaking engagements in four years, resulted in tens of millions of dollars in donations.

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