WRAL Investigates

Lawsuit: NCCU chancellor tried to steer housing contract, bought SUV with state money

A former top finance official at North Carolina Central University filed suit against the university's new chancellor this week, saying he was fired for questioning a $70,000 SUV purchase and accusing the chancellor and two members of the UNC Board of Governors of trying to steer a $90-million-plus contract toward a certain vendor.

Posted Updated

By
Travis Fain, WRAL statehouse reporter
and
Laura Leslie, WRAL Capitol Bureau chief
DURHAM, N.C. — A former top finance official at North Carolina Central University filed suit against the university's new chancellor this week, saying he was fired for questioning a $70,000 SUV purchase and accusing the chancellor and two members of the UNC Board of Governors of trying to steer a $90-million-plus contract toward a certain vendor.

Board of Governors members Harry Smith and Darrell Allison both denied the contracting allegations contained in a lawsuit filed by former Vice Chancellor for Administration and Finance Benjamin Durant. The state confirmed that university funds were used to purchase a GMC Yukon Denali with leather seats and other accessories for Chancellor Johnson Akinleye.

Smith, the current vice chairman on the Board of Governors and set to become the board's chairman, called that purchase "bad judgment" but said he wasn't sure who was responsible. Durant's suit points to Akinleye, saying the chancellor was unsatisfied with a new Nissan Pathfinder provided for him in the summer of 2017.

The Yukon Denali has since been sold by the state at auction for $57,105, according to the state Department of Administration, a loss of more than $12,000.

Akinleye was named chancellor in June 2017, after a year as acting and interim chancellor, but his formal installation is slated for Thursday. The lawsuit was filed Tuesday in Durham County Superior Court.

"Something happened, clearly, that made Chancellor Akinleye feel that he needed to get rid of Ben Durant very, very quickly," Katie Abernethy, Durant's attorney, said Wednesday.

N.C. Central's public affairs office issued only a brief statement on the suit: "North Carolina Central University (NCCU) has acted in accordance to its policies and procedures. The allegations made will be vigorously challenged and defended in the court of law."

The suit accuses Akinleye, Smith and Allison of trying to steer a student housing contract worth $90 million to $120 million toward Preiss Development of Raleigh.

"My client was a real stickler for making sure that the process for picking that development partner stayed on track and that there was an RFQ process that was fair and open, that no particular contractor was given an edge before that RFQ process. And he met a lot of resistance in that," Abernethy said.

Joe Green, president of Preiss Development and, according to the lawsuit, the company point man on the N.C. Central deal, said Wednesday was the first he'd heard of the suit.

Smith said Preiss Development was one of nine potential bidders on the project and was among the first eliminated. A Preiss company attorney confirmed that and said the company is "dismayed to learn it had been identified in the complaint filed by Mr. Durant."

"What you've got right here is you've got a mad employee," Smith said.

Smith acknowledged that he's been an investor with Preiss Development in the past, but he said he didn't believe he's done a deal with the group in three years and wasn't involved in the N.C. Central deal. Durant, Smith said, is "trying to connect dots that he simply cannot connect, and it's unfortunate."

The lawsuit describes "a series of secret meetings" on N.C. Central's plans to build new on-campus student housing, including a Sunday evening meeting at Akinleye's home in September and an October meeting at Allison's office in downtown Raleigh. At the October meeting, Durant alleges that he told Allison the university needed to run "a fair, open and competitive" contract process.

The suit alleges that Allison responded, "In the private sector, we go through those processes too, but we already know the developer we are going to pick up front."

Allison denied that.

"I know nothing about the vendor process," he said. "I didn't inquire about it. ... I would never reach my hand, or intervene in any way, to manipulate that."

The lawsuit names two other N.C. Central employees at that meeting. One did not return a WRAL News message seeking comment Wednesday; the other declined to comment.

At another meeting two days later, Durant alleges that Smith led a discussion about Preiss Development and answered questions on the company's behalf. He also "aggressively questioned" Durant and "suggested at one point that Mr. Durant should disengage" from the process, the suit says.

Smith said he doesn't remember doing that at all, though he would have answered questions if asked. He was in on a number of meetings on the process and said his mantra was "bid, bid, bid, bid" in an effort to save the university money through a public-private partnership.

"Every meeting we were in, we talked about how many vendors we could get to compete," Smith said.

The state had to sell a GMC Yukon Denali at a loss of $12,000 after it was purchased by North Carolina Central University with taxpayer money.

The lawsuit states that Akinleye "repeatedly and aggressively questioned" Durant about the contract in November and December. Around the same time, Akinleye sought funding for what would eventually become a $69,403 GMC Yukon Denali purchase.

The lawsuit notes that Akinleye requested that the SUV be black in color, with black leather interior and Bluetooth technology. An invoice shows $3,800 was tacked onto the final cost for items such as 22-inch wheels, roof rails, tinted windows and all-weather mats.

The purchase went through after the state Department of Administration, which oversees the state motor fleet, denied Akinleye's initial request as a "luxury vehicle" not available through state contract, according to a department letter sent Akinleye in December.

The purchase, using university funds, followed soon after while Durant was on vacation. Durant alleges it was authorized by Akinleye or staff acting on his behalf.

In January, efforts were made to get the university foundation, a nonprofit that raises private money for scholarships and other programs, to reimburse the university for the Denali, the lawsuit states. When the foundation hesitated, Durant said Akinleye told him that he didn't "want to burn my political capital with the foundation over this vehicle."

Antonio McDaniel, executive director of the foundation, didn't return a phone call Wednesday seeking comment.

The chancellor "became enraged" in that meeting, calling Durant "stupid" and "clueless," the lawsuit states. Durant says the last thing he heard as he was leaving the chancellor's office was Akinleye yelling, "You're gone!"

Two days later, Durant got a letter from the chancellor terminating him, the lawsuit states.

Abernethy said UNC General Administration, which oversees the 17-campus system, was told of Durant's allegations two months ago. The lawsuit states Durant also approached N.C. Central Board of Trustees member Michael Johnson with his concerns and lists this as one of the reasons he was fired.

An attempt to reach Johnson Wednesday was not successful.

Durant also filed a grievance with the university over his firing, but administrators refused to hear it because he was an at-will employee.

"They weren’t accusing him of having done anything wrong, [and] because of that, there was no recourse through the grievance process," Abernethy said.

Durant's suit seeks full reinstatement, back pay, attorneys fees and punitive damages from Akinleye himself.

"The lawsuit is basically alleging that an almost 28-year public servant [with an] unblemished record was terminated from his position for no good reason – and for a lot of bad reasons," Abernethy said. "All because he tried to do the right thing and tried to get other people to do the right thing."

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