William Campbell, 59, of Rainbow City, is charged with using his former position as the director of the Alabama Small Business Development Consortium to obtain more than $7 million over a five-year period. As many as five JSU employees have been subpoenaed to testify by federal prosecutors, said acting university counsel Sam Monk.
In the case, Campbell is facing a 96-count indictment and charges of fraud, money laundering and conspiracy. The indictment includes three counts of mail fraud, 56 counts of wire fraud and 36 counts of money laundering.
Campbell worked out of office space on the JSU campus. Funding for the organizations he headed came from the Legislature, through JSU’s budget.
The trial began Monday and is expected to continue into next week, according to Peggy Sanford, spokeswoman for the federal court in Birmingham. By Wednesday, Monk said, three of the university’s employees had testified, including Meehan and the university’s government relations director, Don Killingsworth. It is not clear when, or whether, the remaining employee might be called to the stand.
Monk also said that the witnesses are under judge’s orders to remain mum on the court proceedings. The subpoenaed employees will be released from the judge’s orders at the conclusion of the trial, he added.
The consortium Campbell directed had offices at all of Alabama’s public universities. Its purpose is to facilitate small business growth across Alabama.
Campbell took the helm of the organization in 2003, and in 2005 he incorporated the Alabama Small Business Institute of Commerce, a nonprofit with a very similar mission. He served as the nonprofit’s president, director, registered agent and was the incorporator of the institute.
The state Legislature directed money to JSU’s Center for Economic Development in the university’s state budget appropriation and the university passed it on to both the consortium and the institute. The university was given administrative fees for its handling of the funds.
“Jacksonville State did not give any money to anybody,” Monk said “The university acted in the same way a grant administrator would.”
The indictment, handed down in the spring, followed a federal investigation. An accounting discrepancy linked to the institute surfaced last year in an audit by the Department of Examiners of Public Accounts.
University officials said Monday that they could not say how much money the university redirected to the business institutions, though The Birmingham News reported Tuesday that Meehan testified that the figure was an estimated $10 million.
If found guilty on all counts, Campbell faces a maximum of 45 years in prison.
Star staff writer Laura Johnson: 256-235-3544.