Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, October 26, 1994 TAG: 9410260038
SECTION: VIRGINIA PAGE: A-1 EDITION: METRO
SOURCE: STEPHEN FOSTER STAFF WRITER
DATELINE: BLACKSBURG LENGTH: Medium
According to a search warrant filed in Montgomery County Circuit Court, police seized a check from the account of Antoine Hobeika, director of the school's Center for Transportation Research. Police were looking at monthly bank statements and deposit records and were searching specifically for a $2,500 check from the Hong Kong Port Authority, the warrant said.
Hobeika met Tuesday with his boss, Vice Provost for Research Leonard Peters, and was presented with an internal audit the school has been conducting since summer, when it was made aware of "suspicions of inappropriate use of funds," at the center, said Larry Hincker, director of university relations.
The audit and the police investigation prompted Hobeika to step down for now. As head of the center, Hobeika has headed the university part of a General Motors-led consortium that won a $150 million federal grant this month for "smart road" and "smart car" research.
"I do not want to jeopardize in any way the activities or good name of the center or the university," Hobeika wrote in a letter to Peters. "In order not to hamper the operations, I hereby temporarily resign my position as director of the center until I have had an opportunity to clear the allegation levied against me.
"I trust I will be able to satisfactorily respond and clear this allegation in short order," Hobeika wrote.
Hincker said the school's audit investigation is focusing on whether Hobeika sold software that rightfully belonged to a private company or to publicly funded Tech.
"That's the question that has to be answered," Hincker said. "It's a question of ownership of intellectual property."
No charges have been filed against Hobeika. State police and university officials cited the early nature of the investigation in declining to provide more specifics about the case this week.
"There's been some allegations made that he sold some software that belonged to Tech," said Lee Bradley, state police Bureau of Criminal Investigation special agent.
"We simply don't know at this stage," Hincker said. "Allegations are easy to make. Proof of wrongdoing is much more difficult."
Hincker took issue with the warrant's use of the term "embezzlement," saying, "We feel like that's an awful strong word. It may have been a poor choice of words."
From Tech's perspective, the investigation is looking more into questions of "scholarly conduct."
However, Bradley said the possibility of "embezzlement" is the crux of a criminal investigation. He said state police have "a number of leads and things that they want to check into."
The warrant says that David Goodyear, the university's audit director, gave police documents that show Hobeika sold computer software developed on a research project and put the money into his own account. Tech police also provided their state counterparts with information.
An official with the Hong Kong Port Authority refused to supply documents to Tech, saying it had purchased the software personally from Hobeika and not the school, the warrant said.
Monday, Hincker said Tech would decide in about a week whether there has been a violation of university policy, law, or of the contract with the sponsor of the research - or no violation at all. Of the check, Hincker said, "the issue ... is one of the things we've uncovered."
He said Hobeika, who will remain a faculty member and could be reappointed to the center's top post, had not yet had a chance to present his explanation.
Hobeika could not be reached for comment despite repeated attempts to contact him at his home and office Monday and Tuesday.
Hobeika's letter said the research was done for the federal government, but Hincker declined to name the research's sponsor or explain how the investigation began.
Hobeika helped persuade Gov. George Allen in February to pledge that the state would build the first two miles of a six-mile link between Roanoke and Blacksburg if the GM-consortium won the "smart road" federal grant. Now that the grant has been won, that pledge could cost the state more than $11 million.
Hobeika, a 51-year-old civil-engineering professor, has been employed by Tech for more than 20 years. He makes $79,500 a year at Tech.
Earlier this week, Hincker said the university had not planned to ask Hobeika to step aside while the investigation continued. But Tuesday evening, Hincker said Hobeika and Peters "came to a mutual agreement" about the resignation.
"We're concerned because this is a very high-profile project," Hincker said earlier. Of Hobeika's role: "It's a high-profile position."
An interim director of the center should be appointed within a day or two, Hincker said. He would not speculate on how long Hobeika's resignation might last.
by CNB