The Washington-based Academy for Educational Development announced that it will sell off all of its programs and assets in the wake of a freeze-out of the nonprofit by the United States Agency for International Development (USAID).
“AED will pursue a process to sell itself of all of its highly valued programs and assets,” said Board Chairman Peter Russell in a statement published on the AED website.
AED’s youth portfolio includes domestic and international development projects. Its U.S. programs include community mapping, a youth innovation fund seeded by the W.K. Kellogg Foundation.
AED’s problems became public in December of 2010, when the organization was notified the USAID was suspending it from receiving any federal funds pending an ongoing investigation by the USAID Inspector General. The agency cancelled AED’s $150 million contract in Pakistan, as well as another contract for work educating citizens in Afghanistan.
Initial findings by the inspector general, USAID said in a statement, suggested “serious corporate misconduct, mismanagement and a lack of internal controls.”
AED brought in $433.9 million in revenue during fiscal 2009, according to its tax returns. Of that, $394.1 million was government funding.
After a review of its operation, Russell wrote in the statement, it became clear that many of the organization’s programs had a better chance to survive if they were spun off to other entities.
“We believe that this acquisition of our assets is the only way to ensure the continuity of our programs and projects and to provide a new home and safe harbor for our talented staff within another appropriate for-profit or non-profit organization,” said Ruseell. “While this is a profoundly sad announcement, it is the right choice.”