MUNCIE, Ind. - Ball State University was the victim of another investment fraud scheme in addition to the $8.1 million scheme announced last week, with the second scheme costing the school $5 million.
University Treasurer Randy Howard tells The Star Press the U.S. attorney's office in Manhattan notified the university in 2011 that it was a potential investment fraud victim, prompting the school to conduct a deep review of all of its investment assets.
Seth Beoku Betts, 38, was sentenced to four years in prison on June 5 in U.S. District Court in New York City. He was arrested in June 2013 in North Carolina on a wire fraud charge.
The U.S. attorney's office discovered the second $5 million investment. Howard would not disclose details of the investment, saying the university was following the recommendation of federal prosecutors "who feel it's in our best interest" to remain silent during ongoing investigations.
Howard acknowledged public outcry over the lack of explanation as to how one BSU employee could make $13 million in bad investments. Howard called the bad investments "a combination of mistakes, negligence and criminal actions," adding Ball State is working with prosecutors and others to determine "which individuals fall into those various categories."
Ball State spokeswoman Joan Todd says the $13.1 million loss will not lead to any cuts at the university or to a tuition increase, saying the money came from unrestricted assets.