Federal prosecutors in Manhattan are investigating a controversial deal that producer Harvey Weinstein made to funnel some proceeds from an auction for AIDS charity amfAR to a nonprofit theater where he had staged a show.
The U.S. attorney's office in Manhattan has subpoenaed financial records and emails from amfAR related to the 2015 benefit, two sources with knowledge of the subpoena told NBC News. Prosecutors declined to comment on the probe, which was first reported by The New York Times.
"We were told unequivocally that we are neither a subject nor a target of the investigation — we are a witness," amfAR board chairman Kenneth Cole, the shoe designer, told NBC News on Friday.
A spokesperson for the American Repertory Theater (ART), the other organization in the arrangement, said in a statement that it was aware of the investigation.
"We are not the target, but of course we are cooperating fully. In light of the ongoing investigation, we are not able to provide further comment," the statement said.
The deal in question was arranged between Weinstein and Cole a few days before the 2015 event. Proceeds from auction lots donated by Weinstein — up to $1.2 million — were to be split between amfAR and ART; an insert in the auction booklet noted some of the money would go to ART.
Weinstein had staged "Finding Neverland" at ART in 2014 before the show moved to Broadway. According to the Times, ART had agreed to reimburse Weinstein and other investors money they sank into the show if they got third parties to donate those sums to the theater.
After the auction, Cole approved a request by Weinstein's office for $600,000 to be wired to ART, over the concerns of amfAR's chief executive and without board approval, according to emails reviewed by NBC News.
"Nothing about this deal feels right to me,” CEO Kevin Frost wrote to amfAR CFO Brad Jensen. When a senior amfAR staffer pressed Cole about what the payment to amfAR was for, he responded, "We don’t want to know," some board members alleged.
The transaction caused a rift in the venerable charity that continues to reverberate — even as the former Hollywood powerhouse has been engulfed by a sexual-misconduct scandal that has spawned criminal investigations.
An attorney hired by amfAR to investigate the matter in 2016 concluded that "Mr. Weinstein used amfAR as a conduit to channel $600,000 to ART."
Weinstein subsequently accused the lawyer of digging into his sex life and threatened to "investigate" every board member, according to minutes of a board meeting. Months later, Cole urged board members to sign nondisclosure agreements about Weinstein. Cole told NBC News that Weinstein offered $1 million to amfAR if everyone signed.
Four members refused to sign and sent a letter of complaint to New York's attorney general alleging a "coverup." The AG's office said it conducted a review of the charity's governance and ordered "deep and meaningful reforms."
Cole would not discuss details of the subpoena amfAR received, which was sent in the last few weeks.
In a statement, he said he "had no idea there [was] a commercial arrangement between Harvey Weinstein and ART." He added, "I have always fulfilled my fiduciary responsibilities in my 30 years at amfAR, and I certainly did not ignore the CEO, who had more knowledge of the circumstances than I."
A spokeswoman for Weinstein referred NBC News to an earlier statement about the amfAR situation: "There was no evidence that Mr. Weinstein engaged in any violation of state or federal charity law or that any charity, bidder or donor was harmed in connection with the amfAR event."
Since the 2015 auction in Cannes, six members have resigned from the 19-seat amfAR board — one of them, a prominent AIDS researcher, just last month.
Two of the board members who wrote the complaint letter to the attorney general issued statements blasting Cole on Friday.
"If Mr. Cole had fulfilled his fiduciary duty by listening to amfAR’s executives and following our governance policies, amfAR would never have been placed in this unfortunate position," said Jonathan Canno, who has been a board member since he helped found the organization 32 years ago. "The launch of a criminal investigation by federal prosecutors makes it even more incomprehensible that our nonexecutive Chairman continues to claim he has done nothing wrong."
Another veteran board member, Arlen Andelson, added, "He [Cole] also had no authority to ignore amfAR’s rigorous governance policies simply because he wanted to satisfy the demands of Harvey Weinstein."