Attorney Donald Watkins files criminal complaint with U.S. Dept. of Justice over fraud and conspiracy related to Alabama A&M, as law firm sends letters threatening defamation lawsuits for reporting on scandals related to $527-million debt and other dubious actions

U.S. Department of Justice

 

Attorney and online investigative journalist Donald Watkins has filed a criminal complaint with the U.S. Department of Justice (DOJ) over actions that have prevented Alabama A&M University from collecting a $527-million debt it is owed by the state of Alabama. The Watkins complaint includes a legal twist, as he explains in a post published yesterday under the headline "Criminal Complaint Filed with the U.S. Department of Justice Names Alabama A&M University as the "Victim" of an Honest Services Fraud Scheme and Conspiracy." Writes Watkins:

Yesterday [12/26/23], I filed a criminal complaint with the U.S. Department of Justice naming Alabama A&M University as the "victim" of an honest services fraud scheme and conspiracy arising from the university's failure to aggressively, faithfully, and fully pursue collection of a $527,280,064 debt owed to this Second Morrill Act of 1890 land-grant institution by the state of Alabama. 

This $527,280,064 debt was publicly announced on September 18, 2023, by the Departments of Education and Agriculture. As alleged in the complaint, the honest services fraud scheme is led by Alabama A&M President Daniel K. Wims, and it has jeopardized and compromised the university's ability to collect this $527,280,064 debt.

In my opinion, the honest services fraud scheme alleged in the complaint is an unconscionable and despicable "sellout" of a premier Historically Black College or University (HBCU) in America. In my view, no other legal action is sufficient to stop this "sellout."

The complaint speaks for itself. Click here to read the complaint.

Watkins' criminal complaint comes six days after the MaynardNexsen law firm, acting on behalf of Alabama A&M and unidentified university employees, sent Watkins a "cease and desist letter," threatening to file a defamation lawsuit against him for reporting on scandals swirling around the A&M campus in Huntsville, including A&M's failure to demand payment on a $527,280,064 debt the U.S. Departments of Education and Agriculture  say the state of Alabama owes A&M due to chronic underfunding over a period of roughly 30 years.

 

Here are key sections of Watkins' complaint to the DOJ:

 

(1) The Honest Services Fraud, Waste, and Abuse at Alabama A&M

 

Alabama A&M is the victim of honest services fraud, waste, and abuse with
respect to this $527,280,064 debt. This case involves an ongoing honest services fraud scheme, in violation of 18 U.S.C. §1346, and a conspiracy to commit honest services fraud, in violation of 18 U.S.C. §1349.

By state law, President [Daniel] Wims and the university’s board of trustees have a statutory and fiduciary duty to provide honest services to Alabama A&M. This duty includes the responsibility to protect, secure, and safeguard all assets in the university’s portfolio of assets, including: (a) all university funds, (b) legal claims to university funds in the possession of another person or entity, and (c) causes of action in major debt-collection matters, without any regard to personal gain or loss.

No state or federal statute authorizes Wims and those acting in concert with
him to engage in an honest services fraud scheme and conspiracy that has the purpose or effect of wasting university assets, jeopardizing  university financial claims, and abusing the university’s governance apparatus.

 

After Gov. Ivey and Daniel Wims received the federal government’s
September 18, 2023, letter, Wims, acting in concert with (i) certain university trustees, who had a conflict of interest, (ii) the Dentons law firm, which is conflicted, (iii) the MaynardNexsen law firm, which is conflicted, and (iv) various professional services vendors chosen by Wims, engaged in an honest services fraud scheme to undermine, compromise, or otherwise harm Alabama A&M’s entitlement to the $527,280,064 referenced in the federal government’s September 18th letter.

The object and purpose of the scheme and conspiracy was to: (a) secure and
protect Wims’ presidential job and his attendant $400,000 annual salary in the face of Gov. Ivey dismissive attitude towards the government’s claim that Alabama A&M is entitled to $527,280,064, (b) protect the revenue streams flowing between the state and certain business interests tied to the conflicted trustees, and (c) allow the conflicted law firms and other participants to feast off Alabama A&M’s operating budget monies.

The following section is of particular interest because MaynardNexsen, which has an office in Birmingham, has sent "cease and desist" letters to both Watkins and me, threatening defamation lawsuits against both of us for our reporting on matters of public interest at Alabama A&M. From the Watkins criminal complaint:

MaynardNexsen’s role in the fraud scheme is to silence whistleblowers by
using the threat of state-law defamation prosecutions against them. The law firm’s authority to do so comes from approvals granted by Wims and others who are acting in concert with Wims to defraud Alabama A&M of honest services with respect to the $527,280,064 debt.

MaynardNexsen’s predecessor, Maynard Cooper & Gale PC, represented
Defendant University of Alabama Board of Trustees in opposing the legal claims and relief obtained in 2004 by the Knight plaintiffs for the benefit of Alabama A&M. Whether Alabama A&M suffered “unequitable funding” during the 1993 to 2005 portion of the past 30 years, as claimed by the Departments of Education and Agriculture, was one of the hotly disputed legal claims in the Knight case before it was finally resolved in 2005. The Knight case did not and could not resolve funding inequities between Alabama A&M and Auburn University arising from acts of discrimination from 2005 to 2023.

Additional material facts regarding Wims’ honest services fraud scheme and conspiracy with respect to this $527,280,064 debt will be shared with investigators during the Department’s investigation.

At this time, it is unclear if the threats in the Maynard/Nexsen letters have any basis in law or fact. It is clear, the Maynard firm claims to be acting on behalf of Alabama A&M, as an institution, and certain university employees, who are unidentified in the letters. Here is more from the Watkins complaint:

 

(2) Request for a Full Criminal Investigation and Whistleblower
Status and Protection
 

I am seeking whistleblower protection in my interaction with the Criminal
Division. I am also seeking protection from retaliation, as the Office of Governor views itself as the “Chief Magistrate of the State” and has a history of abusing the power of this Magistrate’s position to unlawfully harass and retaliate against individuals who report fraud, waste, and abuse to regulatory and law-enforcement agencies. (See, Report of the House of Representatives Judiciary Committee on Articles of Impeachment Against Governor Robert Bentley Pursuant to House Rule 79.1, dated April 25, 2017, Attachment titled, Pre-Hearing Submission of Special Counsel regarding Governor Bentley’s “Special Investigations,” at pp. 86-92.) I was a target of Gov. Bentley’s “Special Investigations.” (Id. at p.87).

Finally, I am also reserving my right to receive whistleblower compensation,
if and to the extent that (a) the Department’s investigation of my complaint finds criminal/civil wrongdoing by Wims and those who acted in concert with him to defraud Alabama A&M out of money and honest government services, and (b) the investigation results in Alabama A&M University obtaining the full amount of debt payment/restitution that is due and owing the university, together with statutory interest accruing at 7.5% per annum. AL Code § 8-8-10 (2022).