UCA Internal Audit finds 'fraudulent behavior'

UPDATE: Gillean's attorney responds...

Update, response from Gillean's attorney Sam Perroni, "It is very difficult to comment on an edited and redacted report containing hearsay, opinions, and innuendo predicated on the lies of a coddled prosecution witness, but the material contained therein does not diminish the prosecution's ever present burden of proving guilt beyond a reasonable doubt. It is time for the prosecution and the University to stop trying this case in the media."

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Officials at the University of Central Arkansas may have played favorites — including renewing a scholarship worth thousands for a student who might not be qualified — and turned a blind eye to questioning then Chief of Staff Jack Gillean about his missing key.


That key was used to break into buildings and steal exams to cheat on tests, according to a draft internal audit report dated Monday.


The “Security Breach Audit Report” will be unveiled during UCA’s Audit Committee meeting at noon Friday.


The report details a lack of policy, oversight and communication at the university leading up to the resignation of Gillean, according to the report. Gillean, who was arrested in October, has been charged with four felonies, including commercial burglary, for allowing then student Cameron Stark to use his key to break into buildings and steal exams, according to an affidavit filed at the Faulkner County Courthouse.


Gillean’s attorney Nicki Nicolo said she had not read the audit report by Wednesday evening but said she may comment later.


Stark did not respond to a message left on Facebook. His attorney, Angela Byrd, did not return a message left at her office Wednesday afternoon.


In the report, Internal Audit Director Pamela Massey wrote that the audit is meant to see “if there were additional security breaches” by Gillean. In her conclusion, she wrote the audit found that there has been “fraudulent behavior of upper administration in the last four years at UCA.”


“We are looking at processes, and we look for adequate documentations to support (them),” Massey said. “We are just very factual. We’re kind of the eyes and ears of the board.”


A team of investigators worked on and off on the report since June. Administrators are working on a response to the draft version. Those responses will be included in the final version presented to trustees, Massey said.


Findings in the audit revealed problems in many areas on campus.


In Spring 2011, when a physical plant employee found Gillean’s key on the ground on Farris Road, Physical Plant Director Larry Lawrence returned the key to Gilleon without documenting the incident, according to Massey’s report.


When Gillean said he misplaced his key later that same year, a group of officials, including President Tom Courtway, “collectively determined that since that particular master key would not open dorms or put our students in harm’s way, that UCA would not re-key and it was not a critical issue,” according to Massey’s report. Normal procedure is to file a police report, the audit report said.


That next spring, Assistant Director of Financial Aid for Scholarships Andrew Linn notified police Chief Larry James that a student had Gillean’s master key. That key allows access to almost any building or office on campus and is not supposed to be given to anyone besides the person to whom it was issued. Another key, the Schlage Key, allows access to some of the older offices on campus and is also not supposed to be given to anyone other than the person to whom it was issued, according to the affidavit.


Both keys were used in the break ins, police say.


But police could not validate Linn’s warning and did not question Gillean or take the matter to Courtway, according to the report. On June 11, Linn called police to report someone had broken into the building and stolen prescription medication over the weekend.


Later, police found Stark had used a university grand master key to gain “unlawful entrance” to McCastlain Hall. Stark is a witness against Gillean.


But the audit report also scrutinizes Linn, who increased a student’s cost of attendance for transportation after the student’s car was stolen and damaged. A Conway police report from around the same time — March 8, 2010 — shows Stark reported his vehicle stolen but prosecutors decided not to file charges in the case, according to the report.


According to the UCA audit, that police report is not included as “supporting documentation” for giving Stark more money.


Linn has since provided Internal Audit with the police report, he said.


“I’m a very conscientious in the way I conduct myself professionally and that is why I reported my knowledge of (the student’s) possession of the key,” Linn said. “I believe that this report shows that I did not break any rules or regulations and that proper documentation is in the file and corroborates my statements.”


Linn said he knew Stark because Stark worked in the President’s Office at the time but that the two were not friends.


The report admits Linn did not violate any federal rule, but Internal Audit’s “opinion is that documentation was insufficient to support the unusual circumstances.”


Internal Audit also investigated the scholarship documentation of 11 students who were reviewed because of their association with Gillean. One student was awarded the Presidential Scholarship in 2006-2007, but UCA allowed it to be put on hold for military service and readmission in fall 2008.


Stark served in the military, although the name of the student is not in the report.


Upon review of the student’s course and grade history, auditors found the student completed 26 hours the 2010-2011 school year, even though at least 30 hours and a grade point of 3.25 is required.


The director of Special Projects was unable to give auditors “supporting documentation or evidence of supervisory approval.” Director Larry Burns said the renewal was “based on a medical exception but also could not provide supporting documentation,” according to the audit report.


The audit report’s recommendations included that as “an internal control and to prevent fraud, no single individual should have the authority to renew academic scholarships when the student hasn’t met the renewal criteria of the scholarship.”


Money comes up again in the report.


Between 2008 and 2011, Gillean “displayed management override on student worker pay” in the President’s Office for employees he hired, reported directly to him or were paid from the office funds but worked in Environmental Health and Safety.


Stark worked in the office until April 2011.


Shortly after Gillean resigned, UCA began an audit into a former employee of Gillean’s, Adam Henderson, who resigned just weeks after Gillean. Henderson, who worked in the environmental health and safety office, was interviewed for the audit report.


Henderson received a $20,000 pay raise that was cut in July, according to UCA documents.


According to the audit report, Gillean completed and approved time sheets for employees. Some of those times Gillean put down that a student worked, but the times conflicted with class time or hours “submitted for a local internship,” according to the report.


“It was found that there were four work study students employed by the President’s Office that indicated their time sheets frequently conflicted with class schedules and lacked supervisory approval,” the report said.


The office no longer has student workers since Gillean resigned.


The audit is cc-ed to the state legislative audit committee, where it could be included in a state audit.


The report is filled with recommendations. After the audit committee reviews the report, their decision will go before the Board of Trustees at 1:30 p.m.


“I’m sure the university will look at the recommendations and look at if we need to change some procedures or policies,” UCA spokesman Jeff Pitchford said. “We will certainly take into account how we are operating, and if we need to make changes, we will make changes.”

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