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NC Audit Reveals Fayetteville State University Misappropriated Nearly $700K In Credit Card Funds

Employees at Fayetteville State University‘s communications office are under scrutiny for alleged misuse of university-issued credit cards, as revealed in an investigation conducted by the North Carolina auditor’s office. The investigation uncovered questionable purchases totaling $692,239.

FSU’s former associate vice chancellor for the Office of Strategic Communication, former director of digital strategy, and assistant vice chancellor for marketing and creative services were among the unnamed staff implicated in the investigation.

Of the questionable expenditures, $165,570 was disbursed to businesses owned by employees who had not disclosed their financial interests, potentially creating conflicts of interest. These transactions occurred between January 2022 and August 2023.

“Upon learning of these egregious and disturbing allegations, the University, working in concert with the UNC System, acted quickly and decisively in improving processes,” Fayetteville State Chancellor Darrell Allison said in a letter to the auditor.

Fayetteville State, a historically Black university, is one of the oldest schools in North Carolina’s public university system.

According to the audit report, these findings included:

  1. $575,123 in P-card purchases which were unallowable per University policy.
  2. $84,469 in T-card purchases which were unallowable per University policies.
  3. $322,743 in P-card and T-card purchases which did not contain sufficient documentation to support that they were for a valid University purpose.

The total amount above in findings one through three includes $290,096 of purchases that were both unallowable per University policies and did not contain sufficient documentation.

  1. $165,570 was paid to businesses owned by employees who had not disclosed a financial interest in the business, creating a potential conflict of interest.
Fayetteville State University is a public historically black university in Fayetteville, North Carolina.

The funds designated for travel expenses, initially allocated to the former associate vice chancellor and former director of digital strategy, were diverted to pay consultants, amounting to $71,792 across 26 transactions and other unauthorized expenditures.

The travel-related costs also included a $1,009 expenditure for early arrival and first-class airfare to a conference in New York City, followed by a $287 rideshare to a spa on the conference’s inaugural day. Two individuals from the strategic communications office, as outlined in the report, are no longer affiliated with the university, according to FSU.

Furthermore, procurement cards assigned to all three officials were misused for a range of purchases, including acquisitions from Amazon, gifts, travel-related expenses, IT hardware or software, and invoice settlements.

“FSU’s leadership has been forthcoming, collaborative, and solutions-oriented throughout this process,” State Auditor Jessica Holmes said. “We appreciate their assistance in helping us identify and work together to address these issues and strengthen their internal protocols.”

According to the report, the results of the investigative audit will be forwarded to the State Bureau of Investigation for assessment of the available evidence and consideration of potential criminal charges.

Please see the full audit report here for more information.

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