Nelms said he's asked the State Bureau of Investigation to look into the case involving the Historically Minority Colleges and Universities Consortium which has collected over $13 million from state appropriations, federal and state grants and from private foundations.
The consortium was created by the N.C. General Assembly in 1999 to assist in closing the academic achievement gap between minority and majority school children.
Nelms said an internal audit he initiated last fall has turned up mismanagement of funds.
"Last week, we obtained records of a business checking account opened by a former NCCU employee in the name of HMCUC. Information found in those records triggered additional reporting requirements to the office of the State Auditor and State Bureau of Investigation of potential criminal wrongdoing and/or misuse of state funds," said Nelms in a news release.
Nelms did not name the employee involved. He said he was committed to uncovering the truth.
"If wrongdoing occurred, then the wrongdoers should be prosecuted to the full extent of the law," he said.