Questions over Greg Mortenson's stories

The following is a script from "Greg Mortenson" which originally aired on April 17, 2011 and was rebroadcast on June 24, 2012. Steve Kroft is the correspondent. Andy Court, Kevin Livelli and Maria Usman, producers.

Greg Mortenson is a former mountain climber, best-selling author, humanitarian, and philanthropist. His nonprofit organization, the Central Asia Institute, is dedicated to building schools and promoting education, especially for girls, in remote parts of Pakistan and Afghanistan. President Obama donated $100,000 to the group from the proceeds of his Nobel Prize.

Mortenson's book, "Three Cups of Tea," has sold more than four million copies and been required reading for U.S. servicemen bound for Afghanistan. But after receiving complaints from former donors, board members, staffers and charity watchdogs we began what turned out to be a seven-month investigation.

The story which aired last year had major consequences, raising serious questions about how millions of dollars were being spent, whether Mortenson was personally benefiting from his charity, and whether some of the most dramatic and inspiring stories in his books are even true.

Greg Mortenson's books have made him a publishing phenomenon and sought-after speaker on the lecture circuit, where he has attained a cult-like status. He regularly draws crowds of several thousand people and $30,000 per engagement.

And everywhere Mortenson goes, he brings an inspirational message built around a story that forms the cornerstone of "Three Cups of Tea" and his various

ventures - how, in 1993, he tried and failed to reach the summit of K2, the world's second tallest mountain, to honor his dead sister, how he got lost and separated from his party on the descent and stumbled into a tiny village called Korphe.

Greg Mortenson (speaking on big T.V. screen): My pants were ripped in half and I hadn't taken a bath in 84 days.

Mortenson (in T.V. interview): And I stumbled into a little village called Korphe, where I was befriended by the people and...

Mortenson (in another T.V. interview): They gave me everything they had: their yak butter, their tea. They put warm blankets over me, and they helped nurse me back to health.

Mortenson tells how he discovered 84 children in the back of the village writing their school lessons with sticks in the dust.

Mortenson (speaking on stage): And when a young girl named Chocho came up to me and said...

Mortenson (speaking on another stage): Can you help us build a school? I made a rash promise that day and I said, "I promise I'll help build a school." Little did I know it would change my life forever.

It's a powerful and heart-warming tale that has motivated millions of people to buy his book and contribute nearly $60 million to his charity.

Jon Krakauer: It's a beautiful story, and it's a lie.

Jon Krakauer is also a best-selling author and mountaineer, who wrote "Into Thin Air" and "Into The Wild." He was one of Mortenson's earliest backers, donating $75,000 to his non-profit organization.

But after a few years, Krakauer says he withdrew his support over concerns that the charity was being mismanaged, and he later learned that the Korphe tale that launched Mortenson into prominence was simply not true.

Steve Kroft: Did he stumble into this village weak in a weakened state?

Krakauer: Absolutely not.

Kroft: Nobody helped him out. And nursed him back to health.

Krakauer: Absolutely not. I have spoken to one of his companions, a close friend, who hiked out from K2 with him and this companion said Greg never heard of Korphe till a year later.

Strangely enough, Krakauer's version of events is backed up by Greg Mortensen himself, in his earliest telling of the story. In an article he wrote for the newsletter of The American Himalayan Foundation after his descent from K2, Mortenson makes no mention of his experience in Korphe, although he did write that he hoped to build a school in another village called Khane.

We managed to track down the two porters who accompanied Mortenson, and spoke to them in Pakistan's remote Hushe Valley. They also told us that Mortenson did not stumble into Korphe lost and alone, and that he didn't go to Korphe at all until nearly a year later on another visit.

Kroft: He did build a school in Korphe.

Krakauer: He did. ...and it's a good thing. But if you go back and read the first few chapters of that book, you realize, "I'm being taken for a ride here."

It's not a solitary example. Upon close examination, some of the most touching and harrowing tales in Mortenson's books appear to have been either greatly exaggerated or made up out of whole cloth.

Mortenson (in an interview): One of the most compelling experiences I had was in July of '96...I went to the area to find a place to build a school. And what happened is, I got kidnapped by the Taliban for eight days.

The kidnapping story was featured in "Three Cups of Tea," and referred to in his follow-up best seller, "Stones Into Schools," with a 1996 photograph of his alleged captors.

We managed to locate four men who were there when the photo was taken - two of them actually appear in the picture. All of them insist they are not Taliban and that Greg Mortenson was not kidnapped. They also gave us another photo of the group with Mortenson holding the AK-47.

One of the men, Mansur Khan Mahsud, is the research director of a respected think tank in Islamabad and has produced scholarly articles published in the U.S.

Until recently, he had no idea that he had been shown as a kidnapper in a best-selling book.

We spoke with Mahsud via Skype. He told us he and the other people in the photograph were Mortenson's protectors in Waziristan - not his abductors.

Kroft: The story, as Mr. Mortenson tells it, is that he was held for eight days, and won you over by asking for a Koran and promising to build schools in the area. Is that true?

Mahsud: This is totally false, and he is lying. He was not kidnapped.

Kroft: Who are these people that are also in the picture?

Mahsud: Some are my cousin. Some are our friends from our village.

Kroft: Well, why do you think Mr. Mortenson would write this?

Mahsud: To sell his book.

Another place where no one has done much checking is into the financial records of Mortenson's non-profit organization, the Central Asia Institute, which builds and funds the schools in Pakistan and Afghanistan, and is located in Bozeman, Montana, where Mortenson lives.

He says the charity took in $23 million in contributions in 2010 -- some it from thousands of school children who emptied their piggy banks to help its Pennies for Peace program, and some of it from large fundraisers like this one in Santa Clara, California.

Daniel Borochoff: One. (LAUGH)

Kroft: One.

Borochoff: It's amazing that they could get away with that.

Daniel Borochoff is president of the American Institute of Philanthropy, which has been examining and rating charitable organizations for the last two decades. He says the Central Asia Institute's financial statements show a lack of transparency, and a troublesome intermingling of Mortenson's personal business interests with the charity's public purpose.

According to the documents, the non-profit spends more money domestically, promoting the importance of building schools in Afghanistan and Pakistan than it does actually constructing and funding them overseas.

Borochoff: What's surprising is that most of the program spending is not to help kids in Pakistan and Afghanistan, it's actually... what they call domestic outreach where he goes around the country speaking and the cost incurred for that, things like travel is a major component of that. You know, just advertising.

Kroft: What does that mean?

Borochoff: Sounds like a book tour to me.

His point is that when Greg Mortenson travels all over the country at the charity's expense, he is promoting and selling his books and collecting speaking fees that the charity does not appear to be sharing in. According to the financial statement, the charity receives no income from the bestsellers, and little if any income from Mortenson's paid speaking engagements, while listing $1.7 million in "book-related expenses."

Kroft: The $1.7 million that they spent for book-related expenses is more than they spent on all of their schools in Pakistan last year.

Borochoff: Correct.

Kroft: What do you say, I mean...

Borochoff: It's disappointing. You would hope that they would be spending a lot more on the schools in Pakistan than they would on book-related costs. Why doesn't Mr. Mortenson spend his own money (LAUGH) on the book-related costs? He's the one getting the revenues.

In fiscal year 2009, the charity spent $1.5 million on advertising to promote Mortenson's books in national publications, including a full page ad in "The New Yorker." And there are $1.3 million in domestic travel expenses, some for private jets.

On Saturday, April 16th, we received a statement from the board of directors of the Central Asia Institute acknowledging that it receives no royalties or income from Greg Mortenson's book sales or speaking engagements. But the board says the books and the speeches are an integral part of its mission, by raising public awareness and generating contributions. And it claims that Mortenson has personally contributed hundreds of thousands of dollars to the organization.

But the American Institute of Philanthropy is not persuaded.

Borochoff: I don't think the charity's getting a fair share here, based on the financial reports that I've reviewed.

Kroft: Do you think contributors are being misled?

Borochoff: I think so.

Krakauer: In 2002, his board treasurer quit, resigned, along with the board president and two other board members and said, "You should stop giving money to Greg."

Kroft: Did he say why?

Krakauer: He said, in so many words, that Greg uses Central Asia Institute as his private ATM machine. That there's no accounting. He has no receipts.

Over the years, a half a dozen staffers and board members have resigned over similar concerns, especially about money Mortenson has sent overseas to build schools.

Krakauer: Nobody is overseeing what goes on. He doesn't know how many schools he's built. Nobody knows how much these schools cost.

The IRS tax return Central Asia Institute filed in 2010 included a list of 141 schools that it claimed to have built or supported in Pakistan and Afghanistan. Over a six-month period, we visited or looked into nearly 30 of them. Some were performing well, but roughly half were empty, built by somebody else, or not receiving support at all. Some were being used to store spinach, or hay for livestock; others had not received any money from Mortenson's charity in years.

The principal of one school told us that the institute had built six classrooms poorly several years ago and since then provided not a single rupee. In Afghanistan, we could find no evidence that six of the schools even existed, most of them in war-torn Kunar Province.

Krakauer: In Kunar Province, it's really violent. He built three schools there in 2009. So he goes on Charlie Rose, he says he built 11 schools in Kunar Province.

Mortenson (on Charlie Rose): Today we have 11 schools also in that district.

Krakauer: Why can't he just say he built three? I mean, that's impressive. You say you built 11, I go, "Why are you lying about this?"

One of the schools we looked into in Afghanistan is in Bozoi Gumbaz, a remote outpost in the Wakhan Corridor, on the roof of the world. Mortenson's second book, Stones Into Schools, begins with Abdul Rashid Khan, the leader of a semi-nomadic people, sending horsemen to summon Mortenson to his camp. The book ends with Khan, on his deathbed, ordering every available yak in the high Pamir to haul supplies for a school that will serve 200 children.

But Ted Callahan, an anthropologist who spent nearly a year in the area, says the story doesn't ring true.

Callahan: The number of children that this one school's going to educate - that's just nonsense. The words that Abdul Rashid Khan says in this book - this is a man who probably came to my tent every day for an hour or two. And the man that I knew is not the man who's portrayed in this book.

Kroft: You seem to be saying that most of it is B.S.

Callahan: The most generous thing I could say is that it's grossly exaggerated. And probably the harshest thing I could say is a lot of it just sounds like outright fabrication.

We obviously wanted to talk to Greg Mortenson, who has appeared on just about every news and talk show on television, but he didn't want to talk to "60 Minutes."

Mortenson: How ya doin'?

Kroft: Steve Kroft.

Mortenson: Nice to meet you.

Kroft: How ya doin'?

Mortenson: Thanks.

Kroft: You got five minute for us today?

Mortenson: I need to sign these books right now, so...

Kroft: Yeah, I know, you know, we haven't heard from...it's been almost a week. We haven't heard from you or the board. And we're just trying to...

Mortenson: I need to sign these right now.

Kroft: I don't wanna disrupt this, but...

Mortenson: Well, you're already disrupting it, so, thanks...

Kroft: Okay. Can we come back? We'll wait for ya.

Mortenson: Thanks.

Mortenson's staff immediately contacted hotel security, which asked us to leave. They told us if we retired to the lobby one his staff members would stop by or call us to discuss a possible interview. They never did. Mortenson cancelled his afternoon appearance and left the hotel through a back entrance.

Krakauer: He's not Bernie Madoff. I mean, let's be clear. He has done a lot of good. He has helped thousands of school kids in Pakistan and Afghanistan....He has become perhaps the world's most effective spokesperson for girls' education in developing countries. And he deserves credit for that...Nevertheless, he is now threatening to bring it all down, to destroy all of it by this fraud and by these lies.

After our story aired, Greg Mortenson dropped off the lecture circuit and became the subject of an investigation by Montana Attorney General Steve Bullock, who concluded that Mortenson had failed to reimburse his charity for more than a million dollars in expenses related to the promotion and the sales of his book.

As part of the settlement with the attorney general's office, Mortenson agreed to pay the money back, and the charity agreed to install a new board and a new executive director. Mortenson is allowed to remain with the charity as an employee but he is prohibited from holding any position involving financial oversight.

Response from Central Asia Institute

"Details of Central Asia Institute's ongoing project survey, which credentials the organization's performance in Pakistan and Afghanistan, are documented in the Master Project List available at www.ikat.org.

Also at www.ikat.org are financial information and CAI's Communique, which provides relevant information and includes responses to specific media allegations made against CAI.