UNDNorTH DAKOTA. TO: President Schafer FROM: Tim Rerick, Director, intemal Auciting 7R DATE: April 19, 2016 Joshua Riedy Accusations ‘The following accusations were made against Joshua Riedy, Vice Provost and Chief ‘Strategy Officer: In March 2016, an accusation was made to Tom DiLorenzo, Vice President for ‘Academic Affairs & Provost that State funds were misused to enable an affair between Joshua Riedy and his subordinate Kelsey Svoboda, Workflow Specialist! Special Projects Coordinator. For this accusation, we reviewed their joint travel to determine if they were traveling together without a business purpose. Kelsey was hired by Joshua and began employment at UND on October 8, 2014. Our investigation consisted of the folowing * Reviewing Kelsey's and Joshua's travel reimbursements for the dates that they ‘traveled together starting with November 23 ~ 24, 2014 (Kelsey's first travel dates) through February 11, 2016. ‘+ Reviewing Kelsey's position description (job duties) and comparing these duties to the purposes of her trips per her travel expense vouchers. ‘+ Interviewing Kelsey and asking for explanations for each of her travel reimbursements, We also asked her, “Are you or have you been in a romantic relationship with Joshua Riedy?" ‘Interviewing Joshua and asking for explanations for each of his and Kelsey's travel reimbursements. We also asked him, "Are you or have you been in @ ‘romantic relationship with Kelsey Svoboda?” elsey was reimbursed for 14 trips, 13 of which she traveled with Joshua, Based ‘on our review of Kelsey's job duties and the information provided by Joshua and Kelsey, it appears that all oftheir joint travel had a business purpose. 2. Joshua and Kelsey both responded “No when they were asked if they are or hhave been in a romantic relationship with each other.President Schafer April 19, 2016 Page 2 3. Joshua Riedy misinformed us regarding a Memorandum of Understanding (MOU) between the North Dakota University System and the University of Noth Dakota related to the NexusND initiative, We interviewed Joshua on March 24, 2016. During our interview, we asked him about his and Kelsey's travel related to NexusND on January 6 ~ 7, 2016. His response included the working arrangement outlined in the MOU. He further responded in writing after the interview, “As requested by the Chancellor, this meeting took piace to finalize arrangements for UND staff to assist with the NDUS NexusND Initiative. An ‘outcome to the meeting was the MOU | shared in an earlier email message. Joshua also referred to the MOU when we questioned him regarding his and. Kelsey's travel to Tel Aviv, Israel on January 23 ~ 30, 2018. However, Joshua neglected to inform us that this MOU had been rescinded in mid-January 2016 (one week after it had been executed), 4, The rescinded MOU that Joshua prepared for Mark Hagerott, Chancellor, NDUS, included a 20% permanent increase in Joshua's salary, which at the time was $244,527. Per a statement from Chancellor Hagerot, ‘Dr. Riedy contacted me while I was on annual leave, and presented me an MOU regarding a technology initiative of which he was a member. He stated that without the MOU, he would bbe submiting his name to the UND presidential search. | was under a time ‘constraint to commit to this proposed MOU, being in a leave status, being New ‘Year's Eve and, facing the imminent approach of the UND search deadline.” Lisa Feldner, Vice Chancellor for IT and Institutional Research, received an ‘accusation on March 21, 2016. Lisa summarized the accusation as follows, "I Teceived an anonymous call from a man who stated he had a complaint about Josh Riedy. The man said he was tired of tax payer dolars being used to fund trips and the extramarital affair between Josh and another UND employee, Kelsey Svoboda, a project manager on Josh's team. He said it seems like they take an awful lot of trips together and even if there wasn't an affair going on, with the budget situation the Way itis they shouldn't be traveling. He said Josh bragged about getting Kelsey a raise and himself a raise of 20% through an agreement with the chancellor. ‘According to the caller, Josh bragged about running UND and Ed Schafer being just a figurehead. He also said he was running things in the system office because the ‘chancellor is clueless. The caller reported that Kelsey said Josh is running UND and Ed just agrees with everything Josh says.” Findings 1. We noted that Joshua hired Kelsey as a workflow specialist on October 6, 2016, ata starting salary of $47,500, which was 19% above the base pay for that position. Effective January 16, 2015, Joshua had Kelsey's position reclassified to ‘a workflow specialist/special projects coordinator with a salary of $57,000. ‘Therefore, in 3 1/3 months Kelsey received a $9,500 (20%) salary increase: Effective July 1, 2015, Kelsey received a $6,669 salary increase (a merit and a market increase) bringing her salary to $63,689. Therefore, in ® months Kelsey received a $16,169 (34%) salary increase.President Schafer April 19, 2016 Page 3 2. As stated in part finding #4, a 20% permanent increase to Joshua's salary was. included in the original NexusND MOU that Joshua presented to Chancellor Hagerot. ‘Tne above information is provided to summarize the work we performed and is being ven ‘tc yourself and those copied on this memo for your and their consideration. If you have any questions, please let me know. : Alice Brekke, Vice President for Finance and Operations ‘Tom DiLorenzo, Vice President for Academic Affairs and Provost ‘Mark Hagerott, Chancellor, NDUS Lisa Feldner, Vice Chancellor for IT and Institutional Research, NDUS. Karol Riedman, Compliance Officer, NDUS