Former LSU Health chancellor spent charity funds on lavish trips, dinners, liquor, gifts

While chancellor of LSU Health in New Orleans, Larry Hollier used a special account to buy wedding gifts, liquor, lavish dinners and travel for himself and his wife that included luxury hotel stays, limousines and first-class flights, records show.

Though his annual pay was above $1 million — more than almost every LSU employee — Hollier had tens of thousands of dollars in expenses reimbursed each year by the LSU Health Foundation New Orleans, a university-affiliated nonprofit that acts as the medical school’s fundraising arm.

Hollier stepped down as chancellor last fall after LSU auditors said Hollier tried to sidestep university policies while authorizing pay hikes for his inner circle, among other allegations. But that report did not address his expenditure of foundation money that, while private, is collected to serve the medical school’s public purpose.

Hollier’s foundation account also had far fewer controls.

No one at the foundation ever objected to reimbursing Hollier, even when he didn’t provide detailed receipts or explain how the spending was helping to fulfill the nonprofit’s mission, records show.

In many instances, there’s no indication that anyone at LSU or the foundation reviewed his spending at all, even though it appears similar to foundation expenses charged by another LSU official that created controversy more than a decade ago.

First Class Flights, Lavish Hotels

The Times-Picayune | New Orleans Advocate and WWL-TV uncovered the extent of the spending after reviewing nearly 600 pages of Hollier’s reimbursement requests. The news organizations shared their findings with Hollier’s successor, Steve Nelson, who said through a spokesperson that he would not use the account the same way.

Since 2018, Hollier’s expenses included a trip to New York, where the costs of his and his wife’s hotel stay averaged $574 a night. He was there to attend a single-day event, but the couple arrived three days early and charged more than $4,200 for their lodging, meals and a luxury car service, records show.

There were eight other instances where Hollier charged the foundation for travel with his wife, including stays in Boca Raton, Fla., Los Angeles and Texas. He didn’t always explain the purpose of the trips or why his wife came along. He bought first-class flights for himself and his wife for three of the trips, and flew first class on his own for two other trips, records show. His wife was also reimbursed for her registration fees for at least two conferences.

Overall, Hollier billed the foundation for at least $128,000 over three years, records show.

That would have been enough to cover a year of in-state tuition for four medical students. The foundation offers merit and need-based scholarships to a select number of students each year.

'I would call it abuse'

Hollier stood by his expenses in an interview. 

“I think they were all justified,” he said. 

Foundation President Matt Altier said he had no problem with the spending, and said the foundation’s policies were followed.

But Chad Leingang, the foundation’s former president who left in 2016, doesn’t see it that way. 

“I would call it abuse,” he said, referring to Hollier’s first-class flights. 

Leingang said he never would have approved reimbursements for those and other expenses.

“I think he knew better, as long as I was in that position,” Leingang said. “After my leaving, I would argue it’s a free-for-all.”

Hollier resigned in October after auditors -- among other allegations -- said he authorized improper pay bumps for Keith Schroth, the organization’s former CFO who also had his foundation spending called into question years ago.

Three of Hollier’s grandchildren also received more than $93,100 in scholarships handed out by members of the LSU Board of Supervisors, through a controversial program that has sparked concerns of favoritism for years, The Times-Picayune | New Orleans Advocate reported.

Hollier said he had nothing to do with his grandchildren’s scholarships and has denied many of the audit’s allegations.

He remains an LSU Health faculty member and took a six-month sabbatical after stepping down as chancellor. But for the last two months of 2021 and first half of this year, LSU kept paying him at his $1.1 million annual rate, according to payroll records.

Hollier said that arrangement has changed for the second half of 2022, when his compensation will be cut in half.

Hollier has not been reimbursed by the foundation since he stepped down. Nelson, his successor, has shared the spending account with other top LSU Health officials this year, with charges through May totaling about $22,640, records show.

None of those expenses appear to include alcohol or splurges like first-class flights or luxury vehicle services. An LSU Health in New Orleans spokesperson said Nelson has aimed to use the account for “high-level faculty recruitment, team-building activities” and expenses from graduation ceremonies.

“Dr. Nelson would not use this account for the type of purchases you describe,” said the spokesperson, Leslie Capo.

'An unlimited, unmonitored expense account'

When Leingang, the former president, ran the foundation, he hired an outside law firm to audit expenses that LSU Health officials charged on foundation-issued credit cards. Schroth, then the medical school’s CFO, was reimbursed for expenses at bars, Harrah’s Casino and Ruth’s Chris Steak House, the 2009 report from the Liskow & Lewis law firm found.

The foundation revoked the credit cards after the law firm said they “give the impression of an unlimited, unmonitored expense account.” Under a new policy, Leingang reviewed reimbursement requests and cut the checks himself, he said.

Schroth, who also resigned shortly after the release of last September’s audit, told The Times-Picayune | New Orleans Advocate that his expenses had the backing of his bosses at the time -- Nelson and Hollier.

Altier took over as foundation president in 2017. He sits atop a full-time staff of 16 and manages the foundation’s money -- including more than $7.6 million in donor contributions last year.

Under Altier, Hollier said his expenses have had the full support of the foundation, claiming they were approved by the board’s finance committee.

But the board chairman, Warren Gottsegen, said in an interview that wasn’t the case.

Apprised of that response, Hollier said: “I guess it may not have been by the finance committee. It was approved by the foundation. I don't know who the details are in their management of who reviews all of that. I just turned it in.”

Gottsegen, whose 25-member board meets four times a year, referred other questions about Hollier’s spending to Altier.

Altier said the foundation recommends officials fly coach, but first-class flights are allowed “at the chancellor’s discretion,” adding that “reasonable” purchases of alcohol for business purposes are also allowed.

James Fishman, a retired law professor at Pace University who wrote a book on the lack of fiscal accountability for nonprofits, called Hollier’s spending “egregious.”

He flagged the lack of documented approvals of Hollier’s spending. In almost every instance over three years, the section of Hollier’s reimbursement request forms where Altier is supposed to sign off on expenses was blank, records show.

And in another section where Hollier was supposed to detail the purpose of his expenses, it routinely included just two words, “Travel, entertainment.”

“Even if you are the chancellor, you should be getting approval from an official who is responsible for the fiscal wealth of the organization,” Fishman said.

Tickets for his wife

Some of Hollier’s expenses seem perfectly legitimate, such as meals or events the LSU Health Sciences Center hosted in New Orleans, or other instances when Hollier was courting potential donors.

Others are more questionable, like Hollier’s frequent use of luxury car services while traveling out of town.

And some appear to have no basis in supporting the foundation’s mission.

He and his wife’s 2018 trip to New York included a lengthy stay at the Empire Hotel overlooking Central Park. They were there for a one-day event at the New York Academy of Medicine on a Monday, but arrived the Friday before.

A chauffeur brought them to and from the airport. Hollier charged more than $500 for meals at La Boite en Bois, a “romantic French restaurant at the heart of the Upper West Side” and other cafes without providing itemized receipts, records show. The trip totaled at least $4,270.

Other luxuries included a $675 a night hotel for him and his wife in Palm Beach; two dinners at Commander’s Palace that each totaled nearly $1,000; a $231 bar tab at a Minnesota hotel and other instances where he routinely ordered top-shelf liquor at restaurants.

He charged the foundation for his wife’s airfare to or from Minnesota, Chicago, Houston, Austin, South Florida and Los Angeles. They flew first class together in at least three instances, receipts show, including $3,231 flights to the West Coast. Hollier also flew first class to Washington and for another trip to Minnesota.

Hollier said his expenses involved meetings he held with executives at out-of-state hospitals, or were related to his work as a vascular surgeon, even though he rarely outlined those purposes when requesting reimbursements.

His wife helped him court donors and potential employees, he said.

“It was understood that for the Chancellor and his wife, because we were working as a team to recruit people, to recruit doctors and so forth, and meet with the different hospital executives that we had multiple discussions, multiple dinners with different individuals,” Hollier said.

Wedding Gifts

He gave little explanation for the $436 in wedding gifts charged to the foundation in 2018, including a rug for a Baton Rouge geneticist and a vacuum cleaner for a New Orleans financier and his wife, a real-estate agent.

“If we were going to be providing... I guess gifts or entertainment for anybody associated to the professional thing, then that would go through the foundation,” Hollier said. “We wouldn't charge that to the state. We would charge it to the foundation. The foundation reviewed that and if they accepted it, they would pay for it.”

He also bought a $155 glass bowl for the wedding of David Nelson, Steve Nelson’s son. At the time, Steve Nelson was the dean of LSU medical school. Capo, the LSU Health spokesperson, said, “Dr. Nelson not only had no knowledge of it, but it would never even occur to him that this gift could have been paid for this way. That’s a foreign concept to him.”

The gift came with a message, “Best wishes, from Dr. and Mrs. Larry Hollier.”

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