Several Georgia Tech employees contacted its ethics line two years ago when they thought the relationship between a top official at the school and an employee for a vendor crossed professional boundaries.
Campus investigators didn’t find any violations.
But in August, another complaint about the relationship came to the University System of Georgia and the results of that investigation released Tuesday afternoon by Georgia Tech showed why the employees were concerned. The official, Mark Hoeting, violated ethics rules when he directed business to the vendor based on a relationship, which began in 2015, and was briefly romantic, the report said.
More than $5 million in equipment to protect the school’s computer systems was purchased in 2017 by Georgia Tech in deals Hoeting and his subordinates negotiated with the unnamed sales representative, the report by University System of Georgia investigators concluded. The report was completed on March 25.
Hoeting, Georgia Tech’s chief information officer, sent the school a two-sentence resignation letter Tuesday, effective immediately.
Tuesday’s report is the latest disclosure in recent months by the school outlining ethics abuses by top officials. The violations included an official who was paid by a German company to serve on its board at the same time the company was getting paid to do work for Georgia Tech; supervisors playing golf with vendors during work hours; and those supervisors expensing after-hours dining and drinking.
Georgia Tech President G.P. “Bud” Peterson wrote in a letter to the University System released Tuesday that it has put in place new measures to flag potential conflicts of interest, including a review process for all purchases over $500,000. In recent months, Peterson fired some officials, accepted the resignation of others and revamped the reporting structure of his leadership team by having its chief internal auditor report directly to the president. Peterson also brought in consultants to improve ethics training and practices.
PREVIOUS COVERAGE | Georgia Tech president updates campus on changes to improve ethics
“It’s regrettable that these things happen but when they do, it helps us reinforce the messages of ethics and compliance campaigns that when you violate the policy there will be consequences,” Georgia Tech spokesman Lance Wallace said in an interview Tuesday afternoon.
As for why state investigators were able to unearth the relationship and Georgia Tech officials didn’t, Wallace said “in a lot of these cases, it’s having fresh eyes” reviewing new information that has resulted in additional findings.
University System officials recommended Georgia Tech ensure all purchases are done in ways that avoid conflicts of interest. The system is forwarding the report to the state’s Attorney General’s office, like it has done with other ethics reports.
The Atlanta Journal-Constitution reported in late September that Georgia Tech has often been slow to investigate employee complaints about ethics abuses or conflict-of-interest violations. Georgia Tech took an average of 102 days last year to investigate a complaint, the second-longest time of any institution in the University System, according to a report presented in April to the state’s Board of Regents. On average, it took 48 days for a University System school to conduct and complete an investigation.
Georgia Tech has about 80 outstanding reports outlining various ethics complaints, officials said Tuesday. Some of those complaints may be on the same topic, they said.
In October, the AJC and Channel 2 Action News reported Georgia Tech maintained a no-bid agreement for some services with Coca-Cola for at least a quarter-century when there should have been a bid process.
In January, vendor Sodexo, filed a lawsuit against Peterson and the University System of Georgia, accusing the school of withholding documents that it believes may show some top officials who resigned last year in an ethics scandal favored the other company, Aramark, in the selection process.
Peterson, who announced plans to retire this year, has called some of the revelations embarrassing.
In this instance, Hoeting began a personal relationship with the sales representative in question in the summer of 2015, the report said. The relationship included hanging out and getting drinks after work. Hoeting began working for Georgia Tech in April 2016 as its chief operating officer. The relationship with the sales representative became romantic sometime in late June or early July 2016, according to the report. The romantic relationship ended about a month or so later, Hoeting said.
There wasn’t enough evidence to determine whether Georgia Tech overpaid for the equipment purchased from the vendor, but Hoeting also recommended the sales representative and the vendor she represented for other University System and government contacts, the report said.
>> RELATED | Georgia Tech had warning about looming ethics problem
Hoeting said he mentioned the relationship in a meeting with his supervisor, Steve Swant, in January 2017. Swant was fired last yearfrom his position as executive vice president of Administration and Finance for being paid to serve on the board of a vendor that was getting paid to do work for Georgia Tech. Tuesday’s report found no Georgia Tech employee recalled being informed of any such disclosure by Hoeting.
“Some of his employees did, however, suspect that Mr. Hoeting had more than a professional relationship with the sales representative based upon what they observed as the sales representative’s access to Mr. Hoeting, the way negotiations were handled between Mr. Hoeting and the sales representative and the lack of a deep discount that GT was accustomed to receiving from vendors,” the report said.
Support real journalism. Support local journalism. Subscribe to The Atlanta Journal-Constitution today. See offers.
Your subscription to the Atlanta Journal-Constitution funds in-depth reporting and investigations that keep you informed. Thank you for supporting real journalism.