Bowie State foundation audit criticizes Pollard University system blames president for misspending at school

Oversight panel formed

August 29, 1998|By Tom Pelton and Ivan Penn | Tom Pelton and Ivan Penn,SUN STAFF

State university system officials released a blistering audit report yesterday that blames Bowie State University President Nathanael Pollard Jr. for much of the misspending of nearly $182,000 in scholarship and campus activity money from the school's fund-raising organization.

In response to the report on the Bowie State University Foundation and recent articles about mismanagement at the Salisbury State University Foundation, the university system announced the formation of a special commission to review the oversight of all fund-raising organizations affiliated with Maryland's public universities.

The problems came to light after investigations by The Sun showed how foundation officials at Bowie and Salisbury had set up business contracts involving family members, made personal purchases with university credit cards and gave questionable deals to university employees.

The 22-page audit report revealed fresh details of Bowie State's misspending, criticizing the university's top fund-raiser for such personal expenses as $2,000 in local trips around town in an Enterprise Rent-A-Car, $116 for Kennedy Center tickets, $102 worth of pet-care products and $51.35 in silk clothing.

The report also questioned $29,726 in banquet, luncheon and other food expenses the foundation paid and an improper $2,910 pay raise for the foundation director -- all with restricted scholarship and campus activity money.

"We reviewed the audit of the BSU foundation and we report that there were many managementproblems there, lack of communication, a deficit approaching $182,000 in unrestricted funds," said former Gov. Harry R. Hughes, who is a member of the regents' audit committee. "There was a lack of checks and balances over the foundation's funds and they could not find any budget.

"They did not find any fraudulent activity, with the possible exception of the credit card being used for personal purposes and that's being investigated," Hughes said.

In their report, auditors blamed Pollard in part for these and other expenditures, stating that the president should have overseen the organization more closely to prevent misspending.

"We did not, however, find evidence that Dr. Pollard had routinely requested or received the relevant information he needed to assure himself that the foundation's finances were in good order and that the foundation was able to support the many demands placed upon it -- many of which came from his office," auditors stated.

"Based on the conversations we had with those who managed the foundation, there was a conviction that Dr. Pollard had ordered many of the unrestricted expenses. On the other hand, Dr. Pollard maintains that he did not order these expenses, but only requested them, expecting to be rebuffed if funds were unavailable."

Pollard would not comment on the audit, saying, "I think the report to the board today closes the issue on the foundations."

The Board of Regents is considering whether Pollard and others should be punished.

"It has been referred to the organization and compensation committee, which decides evaluations and pay for university presidents. It is up to them to determine responsibility and if any action will be taken" against Pollard, said John Lippincott, a spokesman for the university system.

Bowie's chief fund-raiser, Alvin Major, who made the personal purchases, left the university under pressure in April in the wake of the controversy. The audit report stated that the foundation has billed Major for the expenditures.

The report also criticizes the organization's treasurer, Henry Arrington, who signed checks for a lobbying contract with his son, Michael Arrington, a former state delegate.

The $12,000 contract was for Michael Arrington to represent Bowie State's interest in the state legislature during the 1997 General Assembly session.

But auditors found little evidence that Michael Arrington did any work to earn those payments, only attending one meeting. The )) foundation paid him, even though he was not an employee and did not have a contract, the auditors said.

Moreover, the foundation failed to report to the Internal Revenue Service that it was spending money on lobbying -- a violation of IRS tax law, according to the foundation's tax records.

The auditors warned that the lobbying contract "might jeopardize the foundation's nonprofit status."

The foundation board's chairman, Ira Moss, told auditors that Henry Arrington was a "patsy" for Pollard who would "sign anything" to approve any money Pollard wanted, according to audit records.

In return for this favor, Pollard allowed the payments to both Henry Arrington's son Michael and also hired Henry Arrington's wife as a university employee, according to the account Moss gave auditors.

Auditors also cited Henry Arrington in their report for having used Redskins tickets with the chairman of the foundation board. The foundation signed a $50,773 contract for five years' worth of Redskins season tickets.

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