Report on Harvard’s Endowment

November 2022

Harvard Prison Divestment Campaign

Stop Harvard Land Grabs

Harvard College Palestine Solidarity Committee/Harvard Out of Occupied Palestine

Harvard Act on a Dream

Researchers: Brit Shrader (they/them), Syd Sanders (he/him), Rachel Carle (she/they), Liren Ma (he/him), Renee Perpignan (she/her), Joel Sabando (he/him), Josh Willcox (he/him)

Table of Contents

Introduction

Who are we? What did we find? What are our demands?

Background

1. Lack of Transparency

a) Case Study: Tax Havens

i) The Cayman Islands

ii) Delaware

b) Case Study: Villa “Fintana”

c) Case Study: Offshore Leaks Database

2. Case: Human Rights Abuses

a) Land Grabs

i) Case Study: Amerra Agri Opportunity Fund

b) Israel’s Occupation of Palestine

i. Case Study: Certares Holdings (Optional) LLC

ii. Case Study: Walkers Group

c) Prison Industrial Complex

i. Case Study: HITE Carbon Offset Ltd and HITE Hedge Offshore Ltd

ii. Case Study: Kepos Institutional Opportunities Fund LTD

iii. Case Study: Harspring Capital Offshore Ltd

d) Eviction Crisis

i. Case Study: OAK-Mosser REIT Inc

Conclusion: Organize, Mobilize, and How to Get Involved

Methodology and Data

Introduction 

Who are we? What did we find? What are our demands? 

The following report was compiled from a semester of research from student organizers and activists, as well as the extensive research already conducted by organizations such as the International Consortium of Investigative Journalists, the Open Sanctions Database, Rede Social de Justiça e Direitos Humanos, GRAIN, Worth Rises, the American Friends Service Committee, Mijente, LittleSis, Prison Free Funds, and the Action Center on Race & the Economy.

Who are we?

We are a group of students and alumni from different organizing groups on campus working to expose Harvard’s investments in and profiteering on human rights abuses. We include:

• Harvard Prison Divestment Campaign – an abolitionist organizing group dedicated to fighting for Harvard’s divestment from the Prison Industrial Complex and reparatory reinvestment into the communities it has harmed, as well as supporting currently and formerly incarcerated individuals and community abolitionist organizations.
• Harvard College Palestine Solidarity Committee/Harvard Out of Occupied Palestine – a non-sectarian student organization dedicated to supporting the Palestinan struggle for self-determination, justice, and equality through raising awareness, advocacy, and non-violent resistance. Our organization aligns itself with the demands of the Boycott, Divest, and Sanctions movement.
• Stop Harvard Land Grabs – a group of Harvard students and alumni organizing in solidarity with frontline communities to end Harvard’s destructive farmland investments around the world and demand reparations. Harvard has reportedly invested over $1 billion in land investments globally since 2008. These investments have led to vast harm to people and the environment.
• Harvard Act on a Dream – a student-led, student-run organization at Harvard College focused on supporting and advocating for the immigrant community on campus, our local community, and beyond.

Too many students must grapple with the tormenting fact that their university has invested into the systems that incarcerate, deport, and kill their loved ones, all while occupying and destroying their lands. As Harvard students, we don’t pretend to be fully representative of those impacted by this violence  – our experiences are incomparable to those of the millions who are imprisoned in or deported from the US, whose indigenous lands are stolen worldwide, or who live under a system of apartheid, as more than three million Palestinians do –– but we do promise to always stand in solidarity with all people subjugated by racial capitalism and state violence. We can only hope this report can convince you to do the same.

What did we find?

We define the Prison Industrial Complex as “the overlapping interests of government and industry that use surveillance, policing, and imprisonment as solutions to economic, social, and political problems.” This includes, but is not limited to, occupations, prisons, militaries, land grabs, policing, and border control.

Our research on Harvard’s endowment clearly shows that Harvard 1) completely lacks transparency in its endowment investments and 2) is at the very least complicit with corporations that participate in the Prison Industrial Complex. Some of these findings are outlined below. The rest will follow in a second report.

As a corporation and university with incredible power and prestige, Harvard must use its influence to repair the harms it has caused and set an example for other actors around the world.

What are our demands?

The Harvard Prison Divestment Campaign, Palestine Solidarity Committee/Harvard Out of Occupied Palestine, Harvard Act on a Dream, and Stop Harvard Land Grabs demand the following from Harvard:

1. Transparency. We must know who Harvard is working with, what these companies do, and Harvard’s connection to the exploitation of millions. Specifically, we call on Harvard to make public all of its direct and indirect investments. Additionally, we demand that Harvard clearly specify the structure of the Harvard Management Company’s subsidiary investment complex.
2. Accountability. We call on Harvard to be accountable to impacted communities. Harvard must provide reparations to the communities it has harmed through its investments, the process of which will be led and determined by these communities (i.e. incarcerated individuals, Palestinians, land defenders).
3. Divest. Harvard must take a hard look at the brutality it has invested billions into and reject it. This will be a continuous, ever-fluid process, guided always by the relentless, liberatory critique of the marginalized. The first step is a full divestment from the Prison Industrial Complex, one which will be paired with investment into systems of healing and people power. Only then can Harvard begin to reckon with its violent past.

Until then, we will continue to amplify Harvard’s incriminating silence.

Background 

Let’s start with the “easy” stuff – public holdings, which comprised roughly 2% of Harvard’s endowment in early 2022. The Harvard Management Company (HMC) controls Harvard’s endowment via asset management. It controls and decides the companies, corporations, groups, and individuals that Harvard’s endowment is invested in. In the past, its public holdings have generally consisted of direct stocks (like Alphabet, Google’s parent company), gold, and Exchange Traded Funds (ETFs), collections of many different stocks or bonds purchased on the market as you would a single stock.

Historically, Harvard student-activists seeking transparency analyzed the publicly available investment portfolios of the ETFs Harvard invested in. This research identified whether the ETFs contained shares of companies that profit from the Prison Industrial Complex. For example, as of November 2021, the iShares Core S&P 500 ETF invested 0.27% of each share in Boeing, one of the world’s largest military contractors. That same month, HMC invested $28,151,000 into this ETF and, accordingly, over $76k into the Prison Industrial Complex through Boeing. Although the ETF portfolios are released on a varying basis, using November and December ETF holding data along with the HMC's November SEC filing, we rinsed, repeated, and found the HMC held approximately $17.5 million in the Prison Industrial Complex across its public holdings in late 2021.  

This was the relatively easy way to identify some of the companies HMC invests in. Here’s the problem: In February 2022, HMC sold all of their ETFs, without explanation. Although ostensibly good, this move had a sinister effect: it cut off almost all public information about Harvard’s investments.

What about the billions Harvard has in private holdings, you ask?

As a 501(c)(3) non-profit, Harvard Management Company is required to report its assets in a yearly tax filing called the IRS 990 form. That should tell us everything it’s invested in, right? If only it were that easy.

The first layer of secrecy is the subsidiaries — companies owned or controlled by a parent company that are taxed and sued separately, reducing tax liability (taxes owed) and legal risk. For example, Instagram and Whatsapp are subsidiaries of Facebook. The HMC has six subsidiaries for investment management: Demeter Holdings Corporation, Phemus Corporation, Blue Marble Holdings Corporation, Shipping Venture Corporation, Harvard Private Capital Realty Inc, and Harvard Management Private Equity Corporation (links to IRS Form 990). These subsidiaries aren’t technically the HMC, but are controlled by the “President and Fellows of Harvard College,” have the same address as the HMC, and share employees with the HMC.

Knowing this, we can examine the subsidiaries’ IRS 990 forms detailing the endowment’s private holdings. The HMC’s own Form 990 Schedule R, Part III and IV states it has zero assets, income, and percent ownership for any company. The Form 990s of HMC’s subsidiary companies, however, tell a different story. They reveal, for example, that the HMC subsidiary Phemus Corp has $28,049,444 invested in and 100% ownership of “Nicarao LTD.”

But what is Nicarao LTD?

1. Lack of Transparency

In our research, we found that HMC’s subsidiaries are invested in 341 companies. Of these, we were able to deduce little to no information about 161 companies. Harvard’s investments in these companies total at least $7,532,847,960.

Although the ability to quantify “little to no information” is impossible, our research on these 161 companies led us nowhere. These aren’t companies like Patagonia, where you can look up what they are and know what they do.

What does little to no information look like? Well, if you look up “Associated Funds SPV LP,” which Harvard has $20,136,960 invested into through subsidiary HMPE, all you will find is its SEC registration page and a couple of other pages that lead you nowhere. For most of these organizations, the only thing that appears when you search for them online are Harvard’s tax returns and some obscure address.

At least ten of these companies only exist on Harvard’s Form 990s, with no other web pages appearing.^[1] For example, a Google search for “144 Fulton MMEE JV LLC” lists only 6 results, all of which are Harvard tax records. Other companies only have their initial company SEC filing. Some companies have a website, but the website does not include information about what the company is or what it is invested in.

1. Case Study: Tax Havens^[2] 

i) The Cayman Islands

Out of the 341 related organizations on the HMC’s 990, 81 companies are based in the Cayman Islands – a world renown tax haven – with holdings of over $4.89 billion.

When we say a company is based in the Cayman Islands, all this means is that these companies are registered with an address there. This does not mean that any activities of said companies are conducted in the Cayman Islands. For example, TPRV Capital Fund LTD is a company registered in the Cayman Islands. However, the investment manager of TPRV Capital Fund LTD is TPRV Capital LP, a Harvard-sponsored hedge fund located in Boston, Massachusetts at 699 Boylston St.

Why would companies register in the Cayman Islands, or bother with such intricate and confusing corporate structures? To avoid taxes and to hide information.

Tax havens are countries or states defined by factors such as “no, or nominal, tax on relevant income”, “lack of effective exchange of information”, and “lack of transparency.” The Cayman Islands, for example, has “no income taxes, no property taxes, no capital gains taxes, no payroll taxes, no withholding taxes, and… no corporate taxes” in exchange for these companies paying “licensing fees to the government of the Caymans.” Regarding a lack of transparency, in 2020, the Financial Secrecy Index ranked the Caymans number one for financial secrecy, determined by a jurisdiction’s role in “enabling secretive banking, anonymous shell company ownership, anonymous real estate ownership or other forms of financial secrecy, which in turn enable money laundering, tax evasion and huge offshore concentrations of untaxed wealth.”

Case in point: at least forty of the HMC subsidiaries’ investments in the Caymans are registered at the same address, the infamous “Ugland House.” The Ugland House is a stout, boxy building that, on paper, is home to over 19,000 companies and has been infamously labeled by former President Obama as either “the largest building in the world or the largest tax scam."

In practice, this means that for the vast majority of the companies based in the Cayman Islands, we know absolutely nothing about who this money is connected to and where it is going.

In 2021, Harvard invested over $4.89 billion in the Cayman Islands.  

ii) Delaware

Surprise: the state of Delaware is a tax haven.

According to the New York Times, the "Delaware loophole” enables “companies to lower their taxes in another state… by shifting royalties and similar revenues to holding companies in Delaware, where they are not taxed.” In terms of secrecy, David Finzer, the chief executive of Capital Conservator, claims that Delaware “‘requires the least amount of information… Basically, it requires none.’”

In 2021, out of the 341 related organizations on the HMC’s 990, 116 companies were based in the state of Delaware. Harvard invested over $7.47 billion in these 116 companies.

2. Case Study: Villa “Fintana”  

In 2021, the HMC subsidiary Phemus had a sum of $28,660,657 of assets in nine companies^[3] all associated with the same address “VILLA FINTANA DEL CLUB TERRAZA 2 C MANAGUA NU.” What happens if you look up this address? Well, first you’ll learn that the HMC probably made a mistake, a typo, in its IRS Form 990s that “under penalties of perjury'' are supposed to be “true and complete”. “Villa Fintana'' does not appear to exist.

But the correction suggested by Google, “Villa Fontana,” doesn’t really clear things up. The first result with the typo corrected is Hotel Fontana, a small hotel ​​in Nicaragua with one review. The second result shows that the address “Villa Fontana, Club Terraza 2 C, Oeste, 1 C, Sur 25 VRS, Oeste Casa 137, Managua” is listed as an “entity of interest” on the OpenSanctions website, which describes itself as “an international database of persons and companies of political, criminal, or economic interest.”

Although this address itself is not internationally sanctioned, it is associated with Leonardo Ovidio Reyes Ramirez. The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) placed Ramirez on “OFAC's Specially Designated Nationals and Blocked Persons List.” Reyes Ramirez, President of the Central Bank of Nicaragua (BCN), was sanctioned for supporting Nicaragua’s oppressive “Ortega regime — a regime that has undermined democracy, abused the human rights of civilians, enacted repressive laws with grave economic consequences, and tried to silence the independent news media.”

To be clear, we are in no way implying that the HMC has any connection with Ramirez. Maybe they don’t even know he exists. But that’s not the point — the point is that where the HMC’s investments are housed should absolutely raise eyebrows.

In 2021, Harvard invested $28,660,657 into these nine companies.

3. Case Study: Offshore Leaks Database

        There are at least 49 companies registered under addresses in the Offshore Leaks Database. The Offshore Leaks Database is a database of information from the Pandora Papers, Paradise Papers, Bahamas Leaks, Panama Papers and Offshore Leaks investigations. It aims to “[strip] away the secrecy that cloaks companies and trusts incorporated in tax havens and exposes the people behind them” arguing that “the anonymity granted by the offshore economy facilitates money laundering, tax evasion, fraud and other crimes. Even when it’s legal, transparency advocates argue that the use of an alternative, parallel economy undermines democracy because it benefits a few at the expense of the majority.”

Ara Inc, Nicateca, and Aquila Inc are registered at 87 Mary St, George Town, Grand Cayman, CJ, which appears in the Paradise Papers and Panama Papers. LCM Global Alternative Returns Feeder Fund LP is registered at Whiteley Chambers Don Street St. Helier JE4 9WG, Jersey, which appears in the Panama Papers. PAG Asia Alpha Feeder Limited is registered at PO Box 472 2nd Floor Harbor Place 103 S Church St George Town, Grand Cayman KY11106 CJ, which appears in the Paradise Papers. Toucanet SA is registered at PLAZA 2000, 16TH FLOOR 50TH STREET, PANAMA PM, which appears in the Offshore Leaks Database. As stated earlier, at least forty companies are registered at the infamous “Ugland House” in the Cayman Islands, which appears in the Panama Papers and the Paradise Papers.

2. Case: Human Rights Abuses

1. Land Grabs

i) Case Study: Amerra Agri Opportunity Fund

Amerra Agri Opportunity Fund, L.P. is a hedge fund in Delaware that acts as an investment vehicle for Amerra Capital Management LLC (Amerra). Amerra is an “investor focused on agriculture.” Amerra invests in biofuels and farmland throughout Brazil, including “one of the largest palm oil producers in Perro.” Additionally, Amerra has been sued “by several major banks for aiding and abetting fraud committed by the international cocoa trader Transmar.” Amerra finances the deforestation of  “thousands of hectares of Amazonian forests.”

In 2021, Harvard invested $84,315,353 in Amerra Agri Opportunity Fund, L.P.

2. Israel’s Occupation of Palestine

i. Case Study: Certares Holdings (Optional) LLC

Certares Holdings (Optional) LLC is an insider for TripAdvisor with a history of insider trades. Insiders constitute “officers, directors, or significant investors (greater than 10% ownership) in a company,” meaning that Certares Holdings (Optional) LLC is either an officer, director, or significant investor into TripAdvisor.

TripAdvisor is complicit in Israel’s occupation of Palestine. TripAdvisor’s travel site “has dozens of listings in illegal Israeli settlements in the occupied Palestinian and Syrian territories… driving tourism and providing jobs and income, financing continued settlement existence and expansion, in violation of international law.”

In 2021, Harvard invested $70,204,235 into Certares Holdings (Optional) LLC.

ii. Case Study: Walkers Group

Three companies^[4] are registered under the “care of” Walkers SPV Ltd and one company^[5] is registered under the “care of” Walkers Corporate Limited. Walkers SPV Ltd and Walkers Corporate Limited are part of the Walkers Group. The Walkers Group boasts “a long history of working with clients in Israel, advising on matters of Cayman, BVI, Bermuda, Jersey, Guernsey and Irish law” and “advising clients on Corporate, Investment Funds, Finance and Regulatory matters.”

Particularly, the Walkers Group “acted as [the] Cayman counsel to Group 11…  alongside Israeli lead counsel” during the launch of Group 11’s $200 million Fund V.

Group 11 is “the first venture capital fund to join trading on the TASE UP platform”, which allows “trade on the Tel Aviv Stock Exchange,” an Israeli stock exchange.

In 2021, Harvard invested $211,232,880 into these four companies.  

3. Prison Industrial Complex

i. Case Study: HITE Carbon Offset Ltd and HITE Hedge Offshore Ltd

HITE Carbon Offset Ltd and HITE Hedge Offshore Ltd are based in the Cayman Islands. HITE Hedge Asset Management LLC is the director for both of these companies. While we don’t know the portfolio of its subsidiary companies, HITE Hedge Asset Management LLC is a hedge fund based in Quincy, Massachusetts, whose portfolio includes Microsoft Corp, JPMorgan Chase & Co, Costco, and Exelon, four companies who are complicit in the Prison Industrial Complex. For example, Microsoft provides surveillance and management services for ICE, prisons, and Israeli police, and Costco uses prison labor. In 2018, Microsoft “‘boasted that its Azure services enable ICE to ‘process data on edge devices or utilize deep learning capabilities to accelerate facial recognition and identification.’”

In 2021, Harvard invested $238,401,271 into HITE Carbon Offset Ltd and $202,280,671 into HITE Hedge Offshore Ltd.

ii. Case Study: Kepos Institutional Opportunities Fund LTD 

Kepos Institutional Opportunities Fund LTD is based in the Cayman Islands. The investment manager of Kepos Institutional Opportunities Fund LTD is Kepos Capital LP. While we don’t know the portfolio of its subsidiary companies, Kepos Capital LP is a Hedge Fund based in New York, whose portfolio includes DelTek, Exelon, and Kantech, three companies who are complicit in the Prison Industrial Complex. Exelon, for example, owns Constellation Energy, a company that was contracted by the New York State Department of Corrections and Community Supervision and completed work at several correctional facilities.

In 2021, Harvard invested $5,838,618 into Kepos Institutional Opportunities Fund LTD.

iii. Case Study: Harspring Capital Offshore Ltd

Harspring Capital Offshore Ltd is based in the Cayman Islands. The investment manager of Harspring Capital Offshore Ltd is Harspring Capital Management, LLC. While we don’t know the portfolio of its subsidiary companies, Harspring Capital Management, LLC is a hedge fund in New York whose portfolio includes Google, Amazon, and Wells Fargo & Co, three companies who are complicit in the Prison Industrial Complex. For example, Google’s Cloud Platform is used by the U.S. Customs and Border Protection “to integrate artificial intelligence (AI) into the work of the agency’s Innovation Team (INVNT)... Google’s cloud would reportedly connect with surveillance towers along the U.S.-Mexico border developed by Anduril Industries.” In addition, Google and Amazon are working together to create “a new cloud infrastructure for the Israeli government… one of the largest technology projects in Israel’s history.”

In 2021, Harvard invested $190,267,519 into Harspring Capital Offshore Ltd.

4. Eviction Crisis

i. Case Study: OAK-Mosser REIT Inc

OAK-Mosser REIT Inc is registered under agent Mario N Dahdah, who is also the agent for The Mosser Companies, Inc. The Mosser Companies has been identified as “both a driver and beneficiary of California’s housing and gentrification crises.” Additionally, Mosser Companies faced five lawsuits in 2021 for harassment with the intention to push tenants out. Tenants claimed that Mosser “broke Oakland rental laws by overcharging tenants for utilities, neglecting necessary repairs, and for allowing hazards like mold and pests to fester.”

OAK-Mosser LLC is also listed on HMC’s 990, but there is no information available on this company, including its registration.

In 2021, Harvard invested $4,526,926 into OAK-Mosser REIT Inc and $5,956,849 into OAK-Mosser LLC.

Conclusion: Organize, Mobilize, and How to Get Involved

        As students at Harvard, we have the power and resources to hold our institution accountable and use our voices to draw attention to the harms that Harvard exacts upon peoples and lands around the world. It is our duty as students of this institution to take action against Harvard’s complicity and violence. Here’s how you can get involved:

Harvard Prison Divestment Campaign:

• Website: https://harvardprisondivest.org 
• Listserv/Involvement Form: https://forms.gle/9a76ARU3JZgqq9WS9 
• Insta: @HarvardPDC

Harvard College Palestine Solidarity Committee/Harvard Out of Occupied Palestine:

• Website: https://www.harvardpsc.com/
• Insta: @harvardpsc

Stop Harvard Land Grabs:

• Website: https://stopharvardlandgrabs.wordpress.com/ 
• Insta: @stopharvardlandgrabs

Harvard Act on a Dream:

• Website: https://www.actonadream.org/ 
• Insta: @actonadream

Methodology and Data

For the findings of our report, we used data from the 2021 President and Fellows of Harvard College tax return, as well as the tax returns of the Harvard Management Company and its six subsidiaries for investment management: Demeter Holdings Corporation, Phemus Corporation, Blue Marble Holdings Corporation, Shipping Venture Corporation, Harvard Private Capital Realty Inc, and Harvard Management Private Equity Corporation (links to the IRS Form 990s). We used a PDF to Excel OCR converting tool and edited for any errors. For aggregate data on Harvard’s 2021 investments (i.e. Harvard’s investments in the Cayman Islands), we used RStudio as a coding tool. The code and data used can be found here. For individual examples of Harvard’s 2021 investments, we used data accessible to us on the internet.

For calculating Harvard’s investments in the Prison Industrial Complex, we used Harvard's November 2021 SEC filing report, the six ETFs portfolio data from November and December 2021 (iShares Core S&P 500, 11/2021; iShares Core S&P Small-Cap, 12/2021; iShares Core S&P Mid-Cap, 11/2021); Invesco QQQ, 11/2021); Vanguard FTSE Emerging Markets, 11/2021; Vanguard FTSE Developed Markets, 11/2021), and a database of companies complicit in the Prison Industrial Complex. We used coding to multiply Harvard’s shares in these ETFs by the percentages for companies complicit in the Prison Industrial Complex in the ETF portfolios. The data used for this can be found here. Because the release dates for ETF portfolio data vary and Harvard’s ETF holdings are only released quarterly, this estimate is an approximation. For more detail about this methodology, see HPDC’s 2020 report.