A Georgetown University fraternity is at the center of a legal fight that involves a longtime member, the fraternity’s nonprofit foundation and D.C.’s attorney general.
In a civil complaint filed in D.C. Superior Court in June, Karl Racine alleges that a longtime officer for both Delta Phi Epsilon and its nonprofit foundation accumulated power over the course of decades, then used his position to gain foundation help in buying his Georgetown home.
It also alleges that 80-year-old Terrence Boyle transferred the fraternity’s longtime “Alpha House” — without the fraternity’s approval — to the foundation, which then sold it below market value.
The Georgetown house and Alpha House
According to the attorney general’s complaint, the Delta Phi Epsilon Foundation for Foreign Service Education paid $150,000 of Boyle’s $200,000 down payment to buy the home in 1990. It also allegedly paid 20% of his monthly mortgage payments and helped with both taxes and insurance premiums.
Boyle did pay that $150,000 back to the foundation eight years later, but Racine says “the foundation did not recover any of its mortgage, tax or insurance payments” — nor did it get “consideration of appreciation.”
The fraternity’s Alpha House – which was appraised at $4 million in 2019 — was sold last year. 3401 Prospect St. NW represented over two-thirds of the fraternity’s assets as of early 2020. But it was transferred to the foundation for $1 “with no restrictions or conditions on the donation,” per the complaint, before the foundation sold it to an LLC for $2.6 million.
“At the time of these transactions, the fraternity members had not provided the requisite approval for: the Fraternity’s donation of the Alpha House to the Foundation; the foundation — not the fraternity — entering into a contract for the sale of the house; or the foundation having no obligation whatsoever to purchase a new house for the fraternity’s benefit,” the attorney general alleges.
“Boyle was treasurer of both [Delta Phi Epsilon] entities at the time of the donation and subsequent transfer of the Alpha House, with sole control over the financial accounts of both entities.”
The fraternity is required to maintain a five-member board, but the complaint alleges that since at least 2018, the board only consists of Boyle and two others.
Racine also alleges that the foundation – which was founded in 1960 “to promote the calling of foreign service” through scholarships – “has ceased functioning” under Boyle’s control.
“No foundation funds have served the organization’s nonprofit purchase of awarding educational scholarships,” the complaint alleges.
‘That stuff is nonsense’
Boyle denies wrongdoing.
“All of that stuff is nonsense,” he told The Washington Post in a story that was published Tuesday morning. And a lawyer who represents Boyle, the fraternity and its foundation told the Post that Boyle has not profited off the fraternity.
“It’s a crying shame that these clowns brought this suit,” Harvey Volzer told the Post. “[Racine] has no good faith factual basis for that complaint, and he’s lucky that he has immunity from defamation suits because he is the AG.”
The suit seeks various reform measures, including court-appointed oversight and the removal of Boyle from any leadership role.
Delta Phi Epsilon’s national organization is not named as a defendant in the attorney general’s complaint.