WINNEBAGO COUNTY, Wis. (WBAY) - The Wisconsin Department of Justice has filed felony charges against a former chancellor and a former vice chancellor for UW-Oshkosh.
Richard H. Wells and Thomas G. Sonnleitner each have been charged with five felony counts of Misconduct in Office-Acting in Excess of Lawful Authority as party to a crime.
Wells and Sonnleitner are accused of improperly funneling millions of dollars of university money into real estate projects through a private foundation.
The counts filed against Wells and Sonnleitner say they signed loan guarantees which created "debt or liability against the state."
In August 2016, the state started investigating the financial relationship between UW-Oshkosh and the UW-Oshkosh Foundation. The foundation is independent of the university and is used for charitable purposes.
The criminal complaint states between 2009 and 2011, the foundation set up limited liability companies for business ventures -- the most prominent being the UW-Oshkosh Foundation Hotel Project, the Alumni Welcome and Conference Center, and the UW-Oshkosh Foundation Rosendale Biodigester.
"With regard to business ventures undertaken by each of the above limited liability companies, the defendants, Wells and Sonnleitner, in their official capacities as Chancellor and Vice Chancellor, knowingly made financial guarantees which were in excess of their authority and contrary to the Wisconsin Constitution and state law," reads the complaint.
The UW-Oshkosh Foundation filed for Chapter 11 bankruptcy protection in an effort to reorganize.
Wells' attorney, Raymond M. Dall’Osto, says, "Former UW Oshkosh chancellor Richard Wells and I are saddened that the Attorney General's office has chosen to issue criminal charges against him, based upon memoranda of understanding, loans and undertakings through the UW Oshkosh Foundation, which were intended to benefit the university."
The UW Board of Regents released this statement Thursday:
“Last year, the Board of Regents and UW System asked the Wisconsin Department of Justice to pursue civil and criminal charges against two former campus leaders who broke the sacred trust they carried as public UW officials. The Board took this unprecedented action because Dr. Wells and Mr. Sonnleitner failed to follow rules and statutes that govern university operations, and we are working diligently to rebuild confidence in our institutions and to improve the transparency of foundation transactions. We support these charges by DOJ, and will continue to seek justice in this case while serving students with integrity and transparency.”
Court records show special prosecutor Randall Schneider has been appointed to the cases.
Both men are scheduled to appear in Winnebago County Court on June 11.
Current UW-Oshkosh chancellor Andy Leavitt released this statement to the campus community:
"I know the circumstances surrounding this matter can be concerning for students, faculty, staff, alumni and university partners. However, together we will continue to exemplify resilience through stewardship.
We all care about this institution’s mission, reputation and future, and we are moving forward. We remain focused on transforming lives through learning, teaching, research, service and support at UW Oshkosh.
Together, we also continue to cultivate a campus culture of greater transparency and ethical behavior. UW Oshkosh’s many stakeholders share confidence and compassion as they see us putting our values into practice every day, fulfilling our honorable mission. Your integrity and resolve inspire me daily."