Substantial repayments' expected as SUNY Upstate President remains on leave

<font size="2">Dr. David Smith</font>

As the head of Central New York's largest employer remains on paid leave, we are learning more about what lead up to the trouble.

In a letter obtained by the Albany Times Union, SUNY Chancellor Nancy Zimpher issues four directives to Dr. David Smith, President of SUNY Upstate Medical University. He was placed on leave after concerns arose that he was padding his state pay without permission.

The discovery came just as Dr. Smith was about to become the new president of Pennsylvania State University.

In the letter, Zimpher says 'it appears likely that substantial repayments from you will likely be due.' The exact amounts of the repayments have not yet been determined.

Zimpher says preliminary information indicates that Dr. Smith accepted a substantial increase in his compensation in 2012 and continuing into 2013 paid through the Pediatrics Service Group, LLP. This came without Zimpher's prior approval. The letter also says that in 2010, Smith was actively involved in the establishment of a deferred compensation plan through MedBest Medical Management, Inc., an entity affiliated with Upstate University Health System. As part of that, Zimpher says Smith received nearly $350,000 without approval.

Based on that, Zimpher issued the following directives:

- You shall cease receiving any compensation from or through Pediatrics Service Group, LLP.

- You shall relinquish any claim, right or entitlement to any and all funds in the deferred compensation plan through MedBest Medical Management, Inc. for which you are a named recipient, beneficiary or the like, and shall not receive or accrue any further funds in such plan.

- All expense reimbursements to you shall be subject to the prior written approval of Curtis Lloyd, SUNY Vice Chancellor for Human Resources, or me or my other designee

- You are directed to provide a full accounting of all compensation and remuneration received, directly or indirectly, by you in any form and from any source during the term of your employment with SUNY, and all documents indicating approval or requested approval of all such sources. Such information should be provided to Michael Abbott, SUNY"s University Auditor, by no later than Friday, November 15, 2013.

The two companies named in the report have been the beneficiaries of major multi-million dollar contracts with SUNY Upstate. A search of state records shows there are 21 contracts between Pediatric Service Group LLP and Upstate Medical University total $35.6 million. There are two contracts between Medbest Medical Management and Upstate Medical University totaling $22.4 million.

There is still no word how long Smith will be on leave. Further directives or disciplinary action could be taken as the review continues.

Zimpher has named Dr. Gregory Eastwood officer-in-charge of SUNY Upstate Medical University effective immediately. He previously served as president of Upstate from 1993-2006.