Why The Story From The University System's Top Auditor Is Credible


Yesterday I wrote a post about the North Dakota University System pushing out two of their top accountability personnel. Namely, Chief Auditor Timothy Carlson (pictured above) and Compliance Officer Kirsten Franzen.

Today, in the interest of full disclosure, I wanted to make sure I presented the university system’s case for putting both Franzen and Carlson on leave pending termination.

You can read NDUS Chief of Staff Murray Saugsveen’s memo to Fransen laying out the cause for her pending termination here. You can read Carlson’s memo here, as well as an investigative report from The Village Business Services commissioned by Saugsveen which took a look at Carlson’s work history.

Perhaps the most damning thing in those documents is the VBS report which concludes that Carlson misrepresented his work history. The claim is that Carlson passed off a cleaning business as an independent consulting firm. I spoke with Carlson about that, and he said he set up the business as an umbrella both for his wife’s cleaning venture and his consulting work. He said that he ended up managing both because his wife lost interest in the cleaning business. He said about 50 percent of his reported taxable income during that time was from consulting work, and that he provided information about 8 – 10 of his consulting clients to the investigators.

Really, though, I think Carlson’s work history is beside the point. Especially given that both Chancellor Larry Skogen and SBHE President Kirsten Diederich are on the record with high praise for Carlson’s work.

More important, I think, is the timing of the action taken against Carlson and Franzen by the university system.

When I first spoke with Carlson about this matter he told me his relationship with the university system began to fall apart after an August 21st meeting of the State Board of Higher Education’s Audit Committee (the NDUS hasn’t bothered to update the meeting minutes for this committee since May but the agenda for that meeting is here). Carlson says that at the meeting he and Franszen presented proposals for a records retention policy and a policy for disclosing conflicts of interest.

These are pretty important proposals. Lawmakers have gone on the record saying they believe the university system may be destroying public records instead of turning them over. Also, the university system was caught trying to hide an oh-so-cozy hunting trip between state Senator and university system contractor Lonnie Laffen and the presidents of UND and NDSU. You wouldn’t think it would be controversial to propose policies addressing these issues.

Yet, it seems the proposals did spur the university system to act against Franzen and Carlson.

Item 5 in the memo sent by Saugsveen to Franzen informing her of her pending termination states: “During the Audit Committee meeting in Fargoon August 21, 2014, you provided misleading and inappropriate statements to the Committee.”

Also, according to the VBS report, Saugsveen contacted them to initiate the investigation…on August 22nd. The day after the audit committee.

My father, a homicide investigator for 20 years and a private investigator for another 20 years, has often told me that he doesn’t believe in coincidence. I’ve found that I believe the same thing.

I don’t think it’s a coincidence that the NDUS began to move against Franzen and Carlson after that August 21 meeting. I think Franzen and Carlson demonstrated a desire to address the university system’s manifest problems with transparency, and Skogen/Saugsveen (among others) didn’t like it.

So they decided to find reasons to terminate both.