An article in an August issue of The Chronicle of Higher Education reported that Duke was paying back nearly $700,000 in grant money it says was misspent by two former employees accused of swindling Kenneth Manton Ph.D. '74, then director of the Center for Demographic Studies, after he was hospitalized for depression.

Duke officials defended the operations at the demographics center, saying that problems two years earlier had been rectified and appropriate oversight procedures are in place to support its research. The university had notified the National Institute on Aging (NIA) in April 2001 that it would reimburse the government $682,000 in expenditures from 1998 to mid-2001 that could not be properly documented.

Although the university removed Manton as director of the center, Duke officials and the NIA agreed Manton should stay on as principal investigator on his grants. Officials have emphasized that neither the NIA or Duke have any evidence that the quality of Manton's research had been compromised by the center's financial difficulties or his own personal problems.

Manton is reportedly among the ten-biggest recipients of National Institutes of Health grants, and is perhaps best known for his research (highlighted in the Duke Magazine story) showing that older Americans are healthier now than they were twenty years ago. That finding has influenced debates on Medicare and Social Security.

The Chronicle of Higher Education reported that Duke learned Manton had been institutionalized in early 2001, and there appeared to have been an effort to keep this information from his superiors. (University officials were quoted as referring to a "cult of personality" that grew up around Manton.) Duke immediately informed NIA officials about the situation and appointed another center researcher, Ken Land of the sociology department, as acting director. Around the same time, two employees at the center were fired. One of them was arrested by Duke police in April 2001 on charges of using a Duke credit card to purchase personal items for his restaurant. He posted bail and later fled with the other employee.

According to John Burness, senior vice president for public affairs and government relations, "Professor Manton is widely respected in his field. Duke has tried to provide an environment in which he can continue to be a productive scholar while also ensuring that appropriate safeguards for the administration of his grants are in place." The university has established controls to track how the center's grant money has been spent and reduced the number of credit cards given to staff members.