The Georgia Bureau of Investigation and KSU Police Department are still investigating a fraud case that lost KSU nearly $1 million.
The most recent arrest happened Tuesday after Julius Ogunshola, a Union City man charged with stealing more thanb $67,000, turned himself in.
One suspect is still missing. Joseph Eto of Stone Mountain, allegedly accepted more than $200,000–an amount slightly less than the kickback of $221,050 allegedly accepted by Ramon Langford Morgan, who surrendered to authorities on April 2.
All six of the accused have been charged with “conspiracy to defraud the state” by accepting money from KSU for overpriced work that was never conducted.
Warrants issued for the suspects on March 28 indicate bail for the accused ranges anywhere from $10,000 to $750,000, the most expensive being assigned to Gerald Donaldson, the former executive director of Environmental Health and Safety at KSU.
Four of the men have been released on bail.
Donaldson, who is still in custody, and the other former EHS employees are believed to have created a number of “shell companies” where funds for incomplete work and fraudulent contracts were directed.
An EHS employee since 2001, Donaldson was fired on Oct. 5, 2012 along with the other suspects following a KSU investigation of fraud believed to have started in the summer of 2002.
The investigation followed reports made by KSU staff about unusual payment invoices.
According to a statement released by KSU on March 28, “[the fraud] extended well beyond KSU, to include private organizations and additional individuals outside of the University System.”
The statement also mentions that the men allegedly conducted false vendor profiles that resulted in fraudulent payments. “Malfeasance and fraudulent behavior absolutely are not tolerated, and we will prosecute any and all employees who abuse their roles to steal from this institution,” Randy Hinds, vice president for operations said in the news release. “We will exercise the full extent of the law to prosecute such criminal activity.”
KSU began the investigation and the case was eventually referred to the Georgia Attorney General’s Office. Since then, the school has made several changes to prevent fraud from going undetected in the future.
These changes include the hiring of a new high-level administrator and “rigorous” reviews of all contracts exceeding $5,000 in the past two years, including 70 contracts exceeding $1 million.
The university plans to implement the use of new fraud-prevention software. The Georgia Bureau of Investigation and KSU are unable to comment on the arrests since the case is still under investigation.
