Following a two-year investigation, the Senate Finance Committee has issued a report raising questions about a range of financial practices at the Arlington-based Nature Conservancy and recommending regulatory changes that would affect many of the nation's nonprofit organizations, the Washington Post reports.

The committee's report questions whether the Conservancy's actions at times may have been "inconsistent" with federal tax laws and raises concerns about the size of tax breaks claimed by the organization's supporters, its shortcomings in monitoring development restrictions on some land under its supervision, and certain private deals with Conservancy "insiders." The report also sheds light on the organization's financial dealings and highlights its failure to fully disclose transactions with officials and corporations whose officers sat on its board. Among other recommendations, the report calls for an accreditation system for conservation groups, limits on tax deductions associated with conservation easements, and increased public disclosure for charities.

Senate Finance Committee chairman Charles E. Grassley (R-IA) praised the organization for enacting some reforms on its own. "This report makes it clear that such reforms were necessary, and I commend the Nature Conservancy for making them," said Grassley. "Yet, in several areas, such as related party transactions, public disclosure, conservation buyer transactions, and the reporting and payment of taxes, my hope is that this report will encourage the Nature Conservancy to consider additional reforms."

In a statement, the Conservancy said the committee's concerns largely focused on past practices. "The Conservancy remains confident that all of our work is, and has been, in compliance with the law and in furtherance of our mission. Not everything we tried succeeded, and on occasion we made mistakes, but all of our work was done in good faith and was undertaken to accomplish significant conservation goals."

The committee launched its investigation in May 2003 in response to a multi-part Post examination of Conservancy programs and practices. After the series ran, the Conservancy restructured its board and dropped some practices, including making loans to insiders, selling conservation easements to trustees, and allowing drilling on some of its preserves.