NCCU: Worker diverted funds

Audit handed over to state

Staff WriterApril 2, 2010 

— N.C. Central University has turned an internal audit over to state regulators after finding evidence that a former university employee may have embezzled money from a project funded in part by federal and state grants.

In a March 29 letter to state officials, NCCU Chancellor Charlie Nelms says that the former director of the Historically Minority Colleges and Universities Consortium funneled some of the group's funds into a personal bank account. NCCU is a member of the consortium and serves as its fiscal agent. .

"It now appears that substantial funds may have been diverted into this Bank of America account," Nelms wrote. "The account may also have been maintained covertly by the former employee for improper purposes."

The letter doesn't say how much money was diverted, and NCCU spokeswoman Cynthia Fobert said the university doesn't know. Over the past decade, the program has received more than $13 million from state appropriations, federal and state grants and private foundations.

Nelms' letter does not name the employee, but the consortium's director at the time was Nan Coleman. Earlier this year, Nelms confirmed that Coleman had been fired from the university for poor performance.

An effort to reach Coleman on Thursday was unsuccessful.

The consortium represents a dozen public and private institutions across the state that have traditionally had heavy minority enrollment. Based at NCCU, it helps minority children close the achievement gap. More than a dozen programs operate under its umbrella.

In a statement released Thursday, Nelms said that the consortium has done some very good work for at-risk youth but that he has heard concerns about it since 2007 when he was hired at NCCU.

After consulting with the state Auditor's Office, the state Attorney General's Office and the State Bureau of Investigation, Nelms turned the investigation over to the state Auditor's Office because NCCU doesn't have the resources to untangle the "complicated network of accounts and transactions," he wrote.

"I believe my referral to these better-resourced state agencies will ensure that full discovery and prosecution, if warranted, takes place," he said.

eric.ferreri@newsobserver.com or 919-932-2008.

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