POCATELLO - Promises of big money only left Idaho State University with an even bigger investigation.
Former ISU Research and Innovation in Science and Engineering Complex director Dr. Eric Burgett is the center of an investigation that could turn into a criminal case, after an internal audit by Reese Jensen discovered Burgett used state and federal funding to benefit a company he was secretly working for on the side, called ScanTech.
The audit claimed Burgett had worked for ScanTech before coming to ISU in 2010, where he then persuaded university officials to purchase the former Ballard building for $3.6 million and transform it into the RISE Complex in 2011.
According to that audit, Burgett and ScanTech told ISU officials the RISE Complex would generate roughly $2.6 million in revenue, but the university later discovered Burgett left, still owing the school $628.792 in personnel reimbursement and other indirect costs.
However, during a routine financial review in 2016, ISU officials discovered evidence leading to several discrepancies, which then prompted the investigation.
The audit revealed revenues were so insufficient, this lead to the layoff of more than 30 employees in August.
Before Jensen was able to interview Burgett for the investigation, Burgett had left his position at ISU and could not be reached.
Jensen interviewed several other employees and former students who worked under Burgett, and combed through 109,000 emails, solely from Burgett's ISU account.
According to some of his former students, they were asked to work 12 hours each day, seven days per week, while only being allowed to document 37 hours on their weekly time sheets. When approached by this issue, Burgett handed each of the students $1,000 cash in an envelope, but that still did not amount to what he owed them.
In the audit, he wrote, "It would be impossible to quantify the actual amount of personnel and related costs that should have been charged to ScanTech...but it's clear that amount would be substantial."
Jensen claims, Burgett's undisclosed consulting created a "significant financial interest with ScanTech in violation of Idaho's Bribery and Corruption and Ethics in Government" statute.
On Tuesday morning, Bannock County Prosecutor's Office said no paperwork has been filed yet on any charges that could be brought against Burgett.
There's no word as well if anyone else was involved.
Below is an official statement from ISU:
"In July 2016, Idaho State University’s Office for Research, during routine financial and operational reviews of the Research and Innovation in Science & Engineering (RISE) Complex, found evidence of what were believed to be financial discrepancies related to the spending of research and contract funds. On July 21, Dr. Neels Van der Schyf, Vice President for Research and Dean of the Graduate School, and Brian Hickenlooper, then Assistant Vice President for Finance & Administration, met with financial personnel from the RISE Complex to have these concerns addressed directly. Based on the response of the RISE personnel at that meeting, Dr. Van der Schyf decided that the financial operations of the RISE Complex should be reviewed immediately.
The ISU Office for Research, in conjunction with the Office for Finance & Administration, began a review of the financial operations at the RISE Complex. This review, which revealed that revenues were not sufficient to cover expenditures, led to personnel reductions that occurred in mid-August. As part of the review process, the RISE Complex University Business Officer (UBO) was reassigned. In the course of this review, evidence emerged that raised concerns regarding the management of the RISE Complex under then Director, Dr. Eric Burgett.
As a result, on September 15, 2016, Dr. Van der Schyf removed Dr. Eric Burgett as Director of the RISE Complex and returned him to his position as tenured faculty. Also on September 15, and with the support of President Arthur C. Vailas and Executive Vice President & Provost Laura Woodworth-Ney, Dr. Van der Schyf asked the Director of Internal Audit, Mr. Reese Jensen, to conduct a comprehensive review. Mr. Jensen functionally reports to the Idaho State Board of Education Audit Committee. This review was to include all activities at RISE Complex, including funding, personnel, travel, and third-party relationships. Dr. Burgett tendered his resignation from Idaho State University on September 16, 2016.
The review by Mr. Jensen has been thorough and encompassed not only interviews of employees but also included a review of nearly one hundred and eighty thousand emails and documents. Because of the large scope of the investigation, ISU auditors divided the investigation into separate reports. Although the entirety of the internal review is not finalized, the Office of General Counsel has received a request for records and released them under the Idaho Public Records Act. The reports that have been completed indicate that there were violations of Idaho state law and University policies and procedures regarding the use of public funds and conflicts of interest.
University administration recognizes that there was a lack of compliance at the RISE Complex. As part of ISU’s commitment to a culture of compliance, the internal auditors will conduct a university-wide conflicts of interest audit. ISU has also instituted a conflicts of interest training for all faculty and staff that is to be completed by December 31, 2017."