By James B. Stewart, New York Times |

In what should be a ringing alarm for nonprofit boards across the country long accustomed to minimal scrutiny or accountability, Attorney General Eric T. Schneiderman of New York has signaled that the laissez-faire approach to nonprofit governance is over.

Mr. Schneiderman’s office has sent letters to the board members of Cooper Union for the Advancement of Science and Art, the prestigious college founded in Manhattan in 1859 by the philanthropist Peter Cooper on the premise that it be “open and free to all.” Last year, after the school said it faced financial ruin otherwise, it began charging tuition.

The investigation, reported earlier by The Wall Street Journal, is focusing on the board’s management of its endowment; its handling of its major asset, the Chrysler Building; its dealings with Tishman Speyer Properties, which manages the skyscraper; and how it obtained a $175 million loan from MetLife using the building as collateral, according to people involved.