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ASU Files Suit Over Critical Audit Of Its Finances

ASU Files Suit Over Critical Audit Of Its Finances

MONTGOMERY, Ala. (AP) — Alabama State University has filed a lawsuit against a company that prepared a preliminary audit report that criticized the university's finances.

The lawsuit accuses Forensic Strategic Solutions of issuing a "false and misleading" report that the lawsuit says was intended to interfere with ASU's economic relationships with alumni, students and supporters.

The lawsuit was filed in Los Angeles where it says FSS has "significant operations."

Alabama Gov. Robert Bentley hired the Birmingham-based company for $650,000 to perform the audit after former ASU President Joseph Silver questioned some contracts.  Bentley has said he plans to have every contract looked at.

The suit seeks an unspecified amount of damages.

Julie Wall, a spokeswoman for the company, issued a statement saying "Bentley engaged Forensic Strategic Solutions, Inc., to conduct an independent financial forensics assessment of Alabama State University, which FSS did.

Concerning the lawsuit, she said "FSS does not agree with the allegations in the complaint and will respond in an appropriate and timely manner.  Out of respect for the legal process, FSS will not comment further about any issue or party at this time."

The lawsuit says that the audit interfered with relations between ASU and Wall Street credit rating agencies and resulted in the reduction of the university's A credit rating. The lawsuit says if the credit rating is further reduced it could mean the university will have to pay higher interest rates.

The lawsuit says ASU was not afforded "a meaningful" opportunity  to review or respond to the report before its public release.

Bentley said Monday the university's spending patterns and management were responsible for the downgrade in the credit rating and not his actions.

"Me releasing a report that was by a forensic group, all that did was show what the real problems were," he said.

Bentley has called a special meeting of the university trustees for Oct. 28 to discuss the audit's preliminary findings. He said he has the authority as governor to do more than pursue a forensic audit, but he has not chosen to do that. Bentley has said the meeting will be open to the public and he will not entertain a motion to go into a closed session.

 

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