NYU's Rejection of CPA's MBA Upheld

Posted by: Louis Lavelle on September 14, 2010

I came across a really interesting tidbit while scanning the headlines last night. There’s a delicious piece of irony involved, so bear with me.

Bloomberg News is reporting that a U.S. district judge in New York yesterday upheld a decision by New York University to withhold an MBA degree from Ayal Rosenthal after it learned that he had pleaded guilty to insider trading charges. The charges were that he leaked tips to his brother that he learned at his job as a certified public accountant at PricewaterhouseCoopers. He ultimately served 2 months in prison.

Rosenthal, a part-time student at the Stern School of Business (Stern Full-Time MBA Profile) at the time, had already completed all his coursework for the MBA degree. The faculty’s decision “that Rosenthal was not fit to receive a degree on the basis of his admitted felonious conspiracy to commit securities fraud” was “fully within the faculty’s power and discretion,” wrote the judge, Lewis Kaplan.

Rosenthal, who filed suit in 2008, argued that Stern faculty lacked jurisdiction to discipline him and that NYU failed to comply with its own disciplinary procedures. His lawyer, Edward Hernstadt, said in an interview today that those procedures limit the faculty’s authority to academics, and criminal matters that do not involve the school are typically referred to authorities with the proper jurisdiction. “He did something stupid and it was a crime, but it had nothing to do with academics.”

Okay, now for the irony. During his time at Stern, Rosenthal was a teaching assistant, in a course on professional responsibility.

Reader Comments

John

September 26, 2010 10:09 PM

I'm all for B-schools emphasizing ethics, but this is out of bounds. The guy earned his degree, and his actions outside of the classroom have nothing to do with that. Prison inmates earn degrees all the time, why does NYU think it gets to play high-and-mighty?
And if they DON'T give him the degree that he's already earned, then they owe him back all his tuition, fees & books - plus $100/hour for all the classtime he wasted there.

Honor

October 26, 2010 2:44 PM

I'm pretty sure he had to sign some sort of honor code before attending NYU -- pretty much every school has one -- which gives them plenty of leeway to not award a degree for this type of behavior.

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