The financial dealings of Oral Suer, the former United Way chief accused in an audit last week of taking more than $1.5 million in questionable payments from the local charity, were first flagged by auditors more than 15 years ago but remained a closely held secret among a handful of prominent board members even as the losses mounted over time, audits and interviews show.

As far back as 1987, auditors reported that Suer took $470,000 in advances from the United Way of the National Capital Area, and he professed privately to being "embarrassed by the situation," according to an auditor's memo from October of that year.

But he failed repeatedly to comply with requests to repay the money and continued to withdraw more than his $196,000 annual salary for years afterward, according to the investigative audit released last week.

A few leading board members -- including William G. Tull, then a bank president, and Burt Fischer, then executive partner at Grant Thornton, an accounting firm -- were informed of Suer's withdrawals and tried to handle the matter privately, according to the audit, which examined the finances of the United Way of the National Capital Area going back nearly three decades.

But the matter appears never to have been fully disclosed to all members of the board, who serve as stewards of the millions of dollars in public donations that flow through the organization annually.

This confidentiality may have allowed Suer to keep his job, and may have allowed the United Way of the National Capital Area to avoid scandal. But it proved over time to be a costly display of discretion.

"This is probably the biggest mystery to me," said William Couper, chairman of a reconstituted board at the organization, which ordered the expanded audit. "Why, given the evidence, did they just try to paper it over?"

From the time Suer was confronted in 1987 with that year's audit findings until his retirement in February 2001, he continued to supplement his salary with questionable withdrawals of United Way funds, roughly tripling the amount of losses to the charity, according to last week's audit.

Moreover, under his leadership, ethical and accounting standards at the organization lapsed, former employees and auditors said, leading to lax credit-card documentation, bloated overhead costs and exaggerated fundraising claims. Then, when those practices prompted charges of mismanagement, the revelations of financial improprieties at the charity blew up into a breach of public faith that has proved many times more costly to the National Capital affiliate than the checks written to Suer or the related credit-card abuses.

The group's most recent fundraising drive saw private-sector donations drop from $45 million to $18 million, essentially stranding dozens of social service agencies in the region that depend on United Way support to run shelters, medical clinics and other programs.

Tull and Fischer declined to comment last week and did not talk to United Way auditors. Suer and his attorney did not return phone calls seeking comment.

"The organization has learned a painful lesson here," said Eric Holder, attorney for the reconstituted United Way chapter.

As federal investigators, who are probing the charity's past financial practices, and the organization's new leadership, which is aiming to prevent a repeat, review the paper trail, the central questions are: Why and how were the questionable practices allowed to happen?

Oral Suer, the first chief executive of the United Way of the National Capital Area, led the group from 1974 until his retirement in 2001. He created the charity out of a merger of two others, building it into one of the largest of the United Way of America's 1,200 affiliates.

Suer, now 68, was gregarious, a chain smoker known to be loyal to his staff and respected above all for the charity's ever-increasing donations.

Because of this, he may have been granted some leniency, friends and former colleagues said. And if he took more than $1.5 million in questionable payments, as auditors say, he doesn't appear to have much to show for it.

An avid bowler, he claimed to keep more than 100 bowling balls in his basement. He fixed up three or four vintage Buicks. He liked to buy the newest cameras and televisions. And occasionally, he'd check the odds and lay bets on a football game or a horse.

But the friends and former colleagues say they are mystified by how any of those habits could have amounted to trouble.

"We used to go to the racetrack occasionally," said Frank Barstow, a friend and former United Way employee who said federal investigators have asked him about Suer's gambling. "I never think he lost more than $800. If he's got a gambling problem, I don't know about it."

Suer wore Hush Puppies and outdated suits. He drove a company car, a station wagon sometimes crammed with bowling equipment, to work. And he still lives in the Alexandria house that he and his wife bought in 1971 for $69,000.

"He doesn't have any kind of lifestyle that would call for that kind of money," said Richard Fusco, a former United Way of America vice president and a fellow bowler. "He's got an old car and a house he's had for 30 years. He doesn't drink. He wasn't the most stylish dresser. Nothing would indicate he needed that kind of money."

The 216-page audit released last week, conducted by PricewaterhouseCoopers LLP, stated that Suer began receiving checks far in excess of his salary beginning about 1980. They totaled $33,000 that year, and they rose steadily to a peak of $440,000 in 1986, auditors found.

Each year, Suer made some repayments, but they never covered even half the principal balance.

By 1987, auditors at the time calculated, he still owed the charity more than $470,000. Auditors and some leaders at the organization began crafting a repayment plan, apparently without informing the rest of the board.

Suer, board member Tull and an auditor from the firm of Councilor Buchanan & Mitchell met on Oct. 23, 1987, at American Security Bank to discuss the matter.

"I made sure that Mr. Tull was aware that as of June 30, 1987, the total amount that Mr. Suer owed to the United Way amounted to $470,209.21," reads a memo from E. Burns McLindon, the auditor. "Mr. Suer indicated that he was embarrassed by the situation and everyone was in agreement that immediate steps should be taken to solve the problem as soon as possible."

The problem was not soon resolved, however, according to other notes disclosed in the audit last week.

In early 1989, according to memos, Suer was to have begun repaying his debts with $2,500 payroll deductions. That didn't happen.

"[A bookkeeper] suggested that this delay was due to the installation of the new computer system," according to memos written by Councilor auditor Tony Vallieres. But Vallieres noted that the new system did not go into effect until later. "I believe [the bookkeeper] was pressured into not making the first $2,500 deduction," he wrote.

What's more, Suer at this point turned to other methods of withdrawing money from the United Way, the audit shows, including taking advances on its American Express accounts.

"There were only a few transactions each month and they were all advances on a line of credit," Vallieres noted at the time. "It appeared that the individual advance amounts were very similar to the amounts of the advance checks which Mr. Suer has requested in the past."

In 1991, Tull and Suer made a formal agreement under which Suer was to repay more than $323,000 by surrendering his deferred compensation and having $5,000 a month deducted from his pay, according to a copy of the agreement. United Way's then-attorney, Irving Kator, drafted the agreement and Fischer was consulted, sources familiar with the process said.

It is unclear whether any other board members knew, but the PricewaterhouseCoopers auditors were struck by the secrecy surrounding these transactions.

"We found no footnote disclosure of this significant amount of recurring unpaid advances in UWNCA's financial statements," the auditors said. "We also found no discussion of this issue in the Board of Director's [sic] meeting minutes. . . . It raises questions as to why Mr. Tull did not apparently inform the full Board of this problem and discuss it with them."

What is clear, however, is that Suer continued to take what auditors believe were questionable withdrawals, though in more moderate amounts. By 1999, however, he was padding his pension by more than $200,000, auditors found, by taking payment two years before he retired. Then, in 2001, after he actually retired, the United Way paid him an additional $78,000 in consulting fees, though his successor told auditors that Suer "provided little in the way of personal services to earn that amount."

Last week, after the audit was released, the United Way of the National Capital Area filed suit against Suer, charging that he defrauded the organization of more than $1.5 million.

The new, 21-member board that took over leadership of the United Way this year has sought ways to avoid repeating the problems connected to Suer.

One of the key actions has been in ensure that the full board of directors is given an increased oversight role. The directors now meet at least monthly, instead of quarterly, and virtually every matter of governance must win board approval.

The organization has discontinued its longstanding practice of allowing employees to be paid for unused sick leave and vacation, has eliminated executive employment contracts and has tightened oversight of expense accounts.

And the salary and expenses of Charles W. Anderson, who started last month as its new chief executive, will be reviewed by the entire board.

"In the past, there was a positive effort made to keep the board relatively fragmented. Board members could never even get a list of the other board members," said Couper, the new chairman. "Some of them felt very uncomfortable about the lack of information, but they could never develop a critical mass to press the issues. It allowed a small subset of the group to direct the organization."

That diagnosis has shaped the changes, United Way representatives said.

"There's nothing that happens now in this organization that isn't shared by all the board members and the management," Holder said. "The level of transparency is as high as I've ever seen at any organization."

Former United Way chief Oral Suer in 1991, the year of a repayment deal.