Harvard is found culpable in a conflict-of-interest scandal over privatization in Russia: Harvard University may have to repay millions of dollars in federal funds after a judge ruled Monday that the university broke a contract when two employees advising the Russian government on privatization made investments violating conflict-of-interest rules. U.S. District Judge Douglas P. Woodlock's ruling came more than three years after federal prosecutors in Boston filed the complex civil case against Harvard, employees Andrei Shleifer, Jonathan Hay and their spouses. The lawsuit arose out of work by the Harvard Institute for International Development's "Russia Project" in the 1990s to help the country shape its post-Communist government into a modern, capitalist system. The U.S. Agency for International Development gave Harvard about $34 million for the project. The unnamed culprit? Farallon Capital Management.