The selection of a new chancellor for N.C. State University, William Randolph Woodson of Purdue University, ends the latest chapter of financial misbehavior in the University of North Carolina system. But it would be a mistake to assume complacently that all troubles are over. Consider these six examples of high-level financial malfeasance discovered in the UNC system over the past seven years:

East Carolina University

In 2003, internal audits turned up two financial problems. One was mismanagement of a $4.6 million federal grant from the National Library of Medicine. The second was embezzlement by an associate vice chancellor who also headed student housing. The associate vice chancellor was convicted of the crime, returned $84,000 to the university, and received a suspended sentence.

UNC School of the Arts

A special investigative review issued in October 2004 found that:
• The vice chancellor for finance and administration had violated UNC policies in receiving more than $90,000 in consulting and expense payments over 13 years. The controller of the school’s foundation had misled auditors about these payments.
• The vice chancellor made unauthorized transfers of land held by the foundation to a nonprofit corporation he controlled.
• He and the dean of the filmmaking school received payments from a nonprofit corporation in violation of UNC regulations.
• Money from the school’s foundation was diverted to administrators’ discretionary accounts; excessive overtime pay was made; and rules of the employee loan program were violated.

Fayetteville State University

In November 2007, the state auditor’s office revealed financial deficiencies during the year ending June 30, 2006. Specifically:
• Accounting was chaotic. Cash was understated by $831,825, accounts payable by $657,926, and student tuition and fees revenue by $2,224,826. Too many people had access to the purchasing and payment process.
• The university had overpaid financial aid refunds to students by $163,577. Six out of 81 students sampled did not meet the academic standards for financial aid. The university had credited 100 students’ accounts with a total of $180,255 under a debt forgiveness program that lacked eligibility criteria.
Outside the financial sphere, the bachelor of nursing program was in trouble. In 2007, 24 out of 31 students failed to graduate because they failed a standardized exam, and the Board of Nursing put the school on probation for violations.

N.C. Agricultural & Technical State University

In June 2007, the state auditor reported severe financial mismanagement at N.C. A & T, following an internal audit that had identified $2 million in mismanaged funds. Among the problems:
• Questionable payments of about $500,000 were made from a program funded by the federal Office of Naval Research. Some were payments for excessive travel expenses for family members of the program manager.
• An administrative assistant in the Natural Resources and Environment Design Department made $101,000 in unauthorized payments. That person pled guilty to misusing funds.
• The former vice chancellor for information technology and telecommunications misappropriated $87,000 in funds from rebates on computer purchases. He also directed a contract to his executive assistant’s mother.
• Revenues of $380,000 from a beverage vending contract were transferred to the chancellor’s discretionary fund and used for purposes such as artwork, travel for the former chancellor’s wife, and foundation or alumni events.

North Carolina Central University

N.C. Central operated an unauthorized satellite campus at a church in Lithonia, Ga., for four years.

The school, which started in 2004, had enrolled 126 students. It was authorized by Chancellor James Ammons and the chief operating officer of the New Birth Missionary Baptist Church and headed by a trustee of N.C. Central.
Neither UNC system President Erskine Bowles nor the Board of Governors knew about the school, although university policy requires approval of any off-campus program. Furthermore, the school was not accredited. Although schools without accreditation cannot accept federal financial aid, New Birth had received over $500,000 in Pell grants and $2.5 million in federal grants and loans.

N.C. State University

In 2005, using intermediaries, North Carolina Gov. Mike Easley pressured the university to hire his wife, Mary Easley. On July 1, 2008, Mary Easley received an 88 percent increase in pay. A subsequent investigation revealed an on-campus culture of privilege among faculty and administrators. In the end, the provost, the chair of the board of trustees, and the chancellor resigned, and Mary Easley’s job was terminated.

These scandals were sizable and significant and should remind the public to be vigilant watchdogs of the university system.

Jane S. Shaw is president of the John W. Pope Center for Higher Education Policy in Raleigh (popecenter.org).