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Alleged embezzler gets boot at UWM

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Also by Tom Schalmo:

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by Tom Schalmo

Monday, October 30, 2006

The president of the University of Wisconsin-Milwaukee Student Association temporarily suspended the government's legislative body speaker Friday, following allegations of a $10,000 embezzlement.

Samantha Prahl suspended Student Senate Speaker Russell Rueden, who has been at the center of a scandal involving the alleged use of fundraising money for personal expenses.

UW-Madison junior Matt Gigot was on the UWM Student Senate with Rueden two years ago and said he is not surprised Prahl decided to suspend him.

"When or if Russ is cleared, I'm confident he will be able to resume his role in student government," Gigot said. "But [Prahl] had to show that she is fully behind this investigation, and she wants to look like she is only interested in providing students unbiased representation."

The money in question was intended for the Sandburg Halls Administrative Council, or SHAC, which is an independent division of the Student Association. The SHAC president is responsible for two separate bank accounts — one including student fees and one with just fundraising money.

Current SHAC President Jesse Dercks said while Rueden's roommate Matt Franson was SHAC president last academic year, Franson wrote a $10,000 check from the fundraising account to AcerPrudens, a private marketing firm that Rueden owns.

Gigot said the issue is not a legal matter, but rather an ethical one.

"It was not illegal for Matt and Russ to do what they did," Gigot said. "The SHAC president was given sole authority over that checkbook … so he could do whatever he wanted with it. But what they did was ethically wrong."

Dercks said while Rueden was SHAC president two years ago, he developed his position to include too much power and gave himself the ability to keep financial records secret.

Dercks added that he immediately reformed his position at SHAC to decrease his level of power and open financial records, saying Rueden was "blatantly lying to parents" in an effort to increase the amount of money in the bank account.

"Up until Russ Rueden, these were open accounts," Dercks said. "Russ stepped in and made it his checking account."

UWM administrators shut down the entire Student Association Oct. 20 following the allegations. For legal reasons, however, the university has yet to directly accuse Rueden of any wrongdoing, only saying there is an ongoing investigation.

Four days later, though, UWM Provost and Vice Chancellor for Academic Affairs Rita Cheng sent a letter to students and faculty about the university's handling of the possible embezzlement, saying Prahl's cooperation has led them to develop a plan to restart the Student Association.

Gigot said UWM and Chancellor Carlos Santiago should not have shut down the entire student government in the first place.

"In my opinion, the chancellor and SA have always been at odds, and this is his way of intimidating them and showing them what power he has," Gigot said.

With the embezzlement investigation continuing, UW System Communications Director Doug Bradley told The Badger Herald that UW System auditors are providing assistance in the investigation.

No timetable has been offered on the reopening of the Student Association, but Dercks said SHAC's operations are back up and running.

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Anonymous (October 31, 2006 @ 12:51pm):

The facts should remain clear that Matt Franson was no longer a member of SHAC when the check cleared from the bank account. Matt wrote the check in Feb/March and the check didn't clear until August. A concern is that why would a check sit uncleared for so long? But one fact is definitely clear, this is an ethical issue and I wonder when it will truely become a legal issue. Why would Russ even accept a check that large from SHAC?