WSU had 'regime of secrecy'
Audit exposes multitude of issues
Wright State released an “unflattering” 108-page audit Friday that identifies problems at the university and its research arm in the wake of a federal investigation. Misuse of temporary work visas,
conflicts of interest and lacking financial controls were among concerns cited in the audit that WSU paid the forensic auditing firm Plante Moran more than $360,000 to conduct.
The audit comes two years after the university fell under the scope of a federal investiga
tion in 2015. The school refused to release it before Friday, and now note that many of the issues have been addressed.
“All the good, the bad, the ugly. It’s all here,” said Wright State University Board of Trustees President Michael Bridges of the audit and 764-pages of attachments.
But not all of the audit documents were released. Trustees say that WSU administrators
wrote objections to some of
the audit’s findings, which they continue to claim is exempt from Ohio public records law.
State leaders expressed simultaneous dismay with the audit’s findings and encouragement to the university for addressing them.
Gov. John Kasich’s press secretary Emmalee Kalmbach said the trustees were right to conduct the audit once the depths of the university’s problems became apparent.
“We’re currently in the process of reviewing its find
ings but what’s clearly evident is the previous administration’s disturbing, long-running practice of seeking to prop itself up by cultivating a regime of secrecy that allowed it to conceal prob- lems from key leaders. It’s incumbent upon this era of university leaders to turn the page, restore confidence and commit itself to the transparency and accountability essential to healthy organizations,” Kalmback said.
Dennis Andersh, director of the Wright State Research Institute, which was a focus of the Plante Moran audit, said “we are committed to transparency. We are com
mitted to compliance... We are committed to living within our means. That was not the case before.”
He said WSRI has made changes including upgrades in compliance, operational efficiency’s, and budget cuts and the institution has recently won $35 million in contracts to conduct research for federal entities such as the Office of Naval Research, DARPA and AFRL.
Local companies named in visa issue
The companies named in the audit as playing a role in WSU’s use of the H-1B per- mits are Lexis/Nexis of Miami
Twp., Beavercreek-based UES, Inc., Beavercreek-based Universal Technology Corporation, and a company based in Montgomery Coun- ty’s Washington Twp. named Web Yoga.
Two of the companies named in the audit are led by current and former Wright State trustees: LexisNexis top-level executive Sean Fitzpatrick was appointed by Gov. John Kasich last year, during the audit. Former WSU trustee Nina Joshi, who resigned from the board during the audit, oversees the Beavercreek-based com- pany UES, Inc.
Fitzpatrick declined to comment on the issue at Friday’s board meeting.
UES issued a statement Friday saying it “has com- pleted an internal review with expert consultants, and come to the conclusion we have acted appropriately.”
“We view this report as an issue internal to Wright State. UES remains focused on our recent business growth and on product development,” the statement says.
All four had contracts with Wright State Research
Institute or its contracting arm Wright State Applied Research Corporation that included work done by people using H-1B visas obtained by Wright State between July 2010 and June 2015.
“Our analysis id e nti- fied multiple occurrences whereby it appears WSRI/ WSARC utilized the H-1B Visa program to obtain foreign labor which was contracted out to external companies (i.e. to obtain foreign labor for clients),” the audit says.
Joe Sciabica, president of UTC, said the call from a reporter was “the first we
knew that UTC had any affiliation or anything with this whole H-1B visa thing with Wright State.”
Web Yoga officials could not be reached for comment Friday.
The audit says WSU provided 22 foreign workers for Web Yoga, four for UTC, at least one to LexisNexis and one to UES.
Federal probe of WSU
Federal officials won’t comment on the scope of
the investigation. The audit cites other
potential examples of this happening, but says before more info could be gath- ered auditors were told “to discontinue researching
the Visa issue and focus on other potential issues.”
The audit is dated October 2016. In September 2015, this newspaper published an investigation that found WSU was sponsoring visas for foreign workers whose listed work location was Web Yoga, UES and LexisNexis.
Immigration experts said the arrangement may violate immigration laws designed to prevent staffing agencies from trafficking in cheap labor from overseas. They said the arrangement also allowed companies to use special rules for universities that allow visas for less-than-market wages and that get around an annual visa cap that doesn’t apply to universities.
The audit questioned the actions of numerous local business leaders, private companies and WSU affiliates.
It questioned a business arrangement with a com
pany named Advratech, which Wright State purchased part of in 2012, then awarded contracts to, the audit says. The audit says
the company gave loans and paid large bonuses and commissions to its executives and sub-contracted work to other companies affiliated with company executives, but the firm returned
little to WSU. Tim Sparling, listed in contract documents as company controller, declined to comment Friday saying the company was sold in the fall.
And auditors questioned bonuses given to executives at the WSU-affiliated Advanced Technical Intelligence Center and its agree
ment to pay WSU’s former police chief up to $250,000 under contract after he was terminated from the university in 2013.
Also Friday trustees directed university administrators to review the audit and decide whether any law enforcement referrals or discipline are warranted.
Lack of transparency
WSU board vice chairman Doug Fecher said WSRI suffered from a culture that coveted winning research contracts at any cost and lack controls and transparency. He admitted that the audit and budget cuts hurt the university’s reputation. “We will get past this.”
Board of Trustees Chairman Michael Bridges said
that the announcement represents a path forward for
the university. “Wright State University
has seen its fair share of turmoil during recent times,” Bridges said. “As we look ahead to the next 50 years as a campus community, the release of this audit report represents one more step toward putting the university on firm footing.”
Trustees said they did not release the report sooner because they did not want to interfere with the federal visa investigation. “We didn’t want to
obstruct anything in terms of their work,” Bridges said. “We have been very desirous and yet we had to wait patiently for this time to come.”