A single employee of Ball State University unilaterally made a decision to invest over $13 million with individuals who later defrauded the university out of the money. Nobody at the university charged with supervising this lone employee was disciplined. State lawmakers are padding university officials on the back for a job well done. From the
Indianapolis Star:
A report released Friday by a former federal prosecutor who investigated the Ball State University investment scandal does not include what everybody wants to know: How did a lone employee, Gale Prizevoits, the former director of cash and investments, invest $13.165 million with two criminals without the knowledge of anyone else at the university?
“There was not a detailed, play-by-play report about what transpired and how these investment frauds were accomplished,” Indianapolis attorney Rick Hall, chairman of the Ball State board of trustees, told The Star Press Friday, after he and President Paul Ferguson appeared before the State Budget Committee.
“That information was reviewed by (CPA firm) Crowe Horwath and (former U.S. Attorney) Deborah Daniels,” he said, “and we will provide information in that regard to prosecutors, and they will make a decision as to who should be prosecuted.”
Hall told the State Budget Committee, meeting in Richmond, that the university doesn’t expect to recover any more than half a million dollars of the investments made with two perpetrators of securities fraud, one from Bronx, N.Y., and one from Boynton Beach, Fla. Both pleaded guilty to federal charges . . .
Hall told lawmakers: “We had a single individual, our director of cash and investments, who intentionally decided to circumvent our internal controls. She knowingly entered into investment contracts outside the scope of the investment policy, and subsequently proceeded to try to cover up those efforts.”
He added, “We had internal controls in place that should have prevented this fraud. Individuals with responsibility of following those internal controls failed us. Those individuals are no longer with the university, so the personnel has changed. This loss of money was not the result of a flawed system. This was a result of flawed individuals.”
In an interview, Hall declined to name any responsible parties other than Prizevoits, saying, “I don’t want to dive into the gory details and re-live that. It’s important to move forward with best management practices in place.”
Prizevoits was fired, but no other BSU employees in the controller’s office or business affairs were disciplined . . .
Here's the reaction of state lawmakers:
“Thank you, folks, for realizing the problem and stamping it out immediately,” Rep. Terry Goodin, D-Austin, told the two BSU officials. “And I think you guys are doing a great job.”
Rep. Tim Brown, R-Crawfordsville, said Ball State’s transparency “re-establishes and elevates your trust in this state.”
“I appreciate your response today,” said Sen. Luke Kenley, R-Noblesville, who chairs the committee.
I guess nobody cares how a person who wasn't even remotely qualified for the job she was hired to do wound up in that job in the first place. Isn't the fired employee
living in Florida with one of her former supervisors?
5 comments:
So,we are supposed to accept the fact that over $13 million just simply disappeared from the coffers of a State university due to the malfeasance of an unqualified employee? I'm not going to buy that.
The money trail led to at least $2 million that Seth Beoku Betts blew on himself but the balance of over $8 millian ended up with the Hebrew Boys operating out of the Bronx with tentacles all the way to LA.
In the 21st centurym money moves by wire so how is it that Feds don't want us to know where the Hebrew Boys wired the hefty balance of money stolen from Ball State to.
"He added, “We had internal controls in place that should have prevented this fraud. Individuals with responsibility of following those internal controls failed us. Those individuals are no longer with the university, so the personnel has changed. This loss of money was not the result of a flawed system. This was a result of flawed individuals.”"
Um no, you didn't have internal controls in place, as this wouldn't happen if there were internal controls in place. Internal controls would have caught this if it truly were a lone employee doing this. Internal controls can be circumvented if there is collusion.
The other incredibly stupid sentence is "if those employees had followed the internal controls in place". Of course this person wasn't going to follow the internal controls, they were planning to steal $13 million!!!
The article by the Star would not meet minimal standards for a first year journalism class. The article is the usual cut and paste from other sources and bagged up as "Reporting."
Our Legislators who have over sight responsibilities are left off the hook, by the article. No tough questions asked about Legislative and State Responsibilities -Just Opps one bad apple, and move on. Perhaps the Legislators are too busy fighting over Same Sex Marriage or Same Sex Civil Unions, Creation Science, or Intelligent Design.
The Eric Turner debacle and now this leads you to think the whole bunch of Legislators needs to be turned out to pasture.
ANON 9:50, your comments hit the Bulls Eye. I did find some information concerning an Audit performed by the State Board of Accounts in 2011 - I thought a telling sentence was, "Accordingly, we do not express an opinion on the
effectiveness of the University's
internal control over compliance."
http://www.in.gov/sboa/WebReports/B38541.pdf
one would think that the legislature would deduct 13 million from ball state's next round of funding. Some one should pay for the misdeeds and neglect of the administration. There should be consequences. Luke, are you listening.
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