Months after the oldest two-year university in the state closed its doors, a serious investigation into its finances has been opened.
The Texas Attorney General's office and Lon Morris college are looking for $1.3 Million in missing endowment funds.
A Rusk man left the money to the school, but explicitly stated in his will that the money would be transferred to Sam Houston State University if Lon Morris College ever closed its doors.
In 2009, a little more than $1 Million was willed to the school by Lon Morris graduate, Dr. James D. Long. Because of interest, that endowment would now be worth about $1.3 Million.
According to the Attorney General's Office, all of that money is gone.
"At this point, it's a paper trail to see what documents there are that would indicate where the money went," says Tyler attorney Joe Thigpen.
Thigpen specializes in civil law. He says that according to Long's will, the original $1 Million was not to be touched.
"They were only to spend interest or income off of that and it didn't appear to me, by just reading the will, that they had any right to invade the corpus or use the corpus for any purpose at all. They were just to use interest or income off of the principal," says Thigpen.
Now, the Texas Attorney General's Office is requesting interviews with the college's accountant and former-president who resigned last spring.
The AG's investigators are demanding a long list of documents, including emails, bank records and minutes from board meetings. They're looking for anything that leads their office to who was managing the funds that should have been deferred to Sam Houston State University.
"That's money, in effect, that a state agency would have received. The Attorney General has an obligation to look into what happened to those funds," says Thigpen.
Long left the money specifically to the Lon Morris College Library. Long asked that a committee of librarians, faculty and staff dictate how the interest from his gift was spent. If that was ever done, it should be clear where the money went.
The Attorney General's Office says the missing endowment funds were brought to their attention after a lawyer for the Long Estate contacted the Texas State University System.
Wednesday, May 22 2013 1:15 PM EDT2013-05-22 17:15:29 GMT
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