RALEIGH — A project manager at North Carolina State University was fired after he received compensation from contracts that he was responsible for administering, according to a report released Monday by the Office of the State Auditor.
The project manager, who was unnamed in the auditor’s report, was also involved in submitting a bid by a company he managed on the side, interacting with other companies that submitted bids to NCSU, selling equipment to those companies from his own organization, all of which are violations of state law, according to the audit. According to the state General Statutes, no employee may receive a direct benefit from a contract in which the employee is responsible for the administration of the contract.
The case has been sent to the 10th Prosecutorial District for review and possible criminal charges. In his response to the audit’s findings, Chancellor James Oblinger said the project manager was fired in May.
“We believe the project manager violated the provisions of [state law] and his fiduciary responsibility to NCSU,” the report says.
At issue is the purchase and installation of a 650-ton electrical centrifugal chiller at NCSU’s Engineering Graduate Research Center last year. After a public bid, the contract was awarded to Industrial Turnaround Corporation with a bid of $257,025.
After the contract was awarded, ITAC enacted a purchase agreement with GIA doing business as Temperature Control Technology and created a joint payment structure between ITAC and TCT and another organization, Thermal Components. An ITAC employee, the audit said, raised concerns about the payment structure but approved the agreement against company policy. He later resigned from ITAC.
As the contract was executed, ITAC learned of a relationship between TCT and the project manager and cancelled the purchase order. During an investigation, the project manager’s relationship with TCT was learned.
When interviewed by auditors about his involvement with TCT, the project manager at first said his wife, a biology manager and physician’s assistant, “sort of runs it” and that he rarely does any work for the company. After further questioning, he later admitted that he ran the business.
The project manager was also involved in purchase agreements with other companies that supplied equipment to NCSU, including a 2003 bid for a 400-ton chiller at Research Building No. 3. A quote for $217,000 was made by TCT/Comfort Products, according to the audit, and was submitted by the project manager. INCO, Inc., after a quote of $216,600, was awarded the contract.
Information found on the project manager’s computer found a TCT quote sheet to sell a chiller for $132,703 to INCO, Inc., according to the audit. The project manager said it was sold for a “$10,000 mark-up.”
TCT and the project manager also sold other equipment to ITAC that would be used at NCSU, Peace College, and other buildings in state government, according to the audit. Two additional NCSU projects involving a contract between TCT and ITAC were for more than $4,600.
The audit also found that in February a check for $11,953.95 from ITAC to TCT was sent to the project manager’s residence. The project manager endorsed that check.
The audit also said the project manager never informed NCSU officials of his relationship with TCT, also a violation of the state Personnel Manual. The Personnel Manual says that an employee must submit “a secondary employment form for all employment” that is not covered by dual employment.