No one mentioned the reputational damage to FAMU as a result of the misuse of the $237 million donation or the leadership of former President Larry Robinson during the donation acceptance process.
Watch FAMU accept and celebrate Gregory Gerami’s donation, which is now in question
FAMU accepted a $237 million stock option donation from Gregory Gerami. The donation is now on hold and in question.
FAMU
After discussing an investigative report that found the administration was deceived by a donor’s “fraudulent” $237 million gift to Florida A&M University, FAMU’s Board of Trustees decided to take steps to strengthen its gift acceptance policies.
The trustees also voted to support a work plan and timeline to be developed by FAMU Interim President Timothy Beard along with Executive Vice President and Chief Operating Officer Donald Palm that will outline how the gift report recommendations will be implemented.
However, there was little comment on the reputational damage to FAMU as a result of the misuse of the gift or on former President Larry Robinson’s handling of the alleged donation.
“It is important that we learn from this and that something like this never happens again at FAMU or any other university,” Chair Kristin Harper told trustees during a virtual meeting Thursday morning on the gift report, followed by a full board meeting.
The panel’s meetings on Thursday came just days after the release of the final report, which followed an investigation by law firm Buchanan Ingersoll & Rooney into the alleged donation to FAMU by Texas hemp farmer Gregory Gerami to clarify the incidents and recommend corrective measures.
More: Dubious donation of $237 million to FAMU is “fraudulent,” says final report of investigation
According to the report, the investigation found that the large donation “was fraudulent and the assessment made by Mr. Gerami was without merit,” and outlined how the university “improperly handled” the donation during its private review process.
None of the FAMU trustees were part of the inner circle that knew the details of the gift. The reason for this, according to the report, is Robinson’s “lack of confidence in the university administration and the Board of Trustees’ ability to maintain confidentiality and not leak information about the donor to the media, which led to the perception that secrecy must be the highest priority.”
The law firm recommended that the university amend the FAMU Foundation Policies and Guidelines and clarify the regulations detailing the president’s responsibilities regarding providing information to the university’s Board of Trustees on financial matters.
“The foundation’s policies and procedures do not address private equity at all, and that was one of the loopholes we found,” said Michael McLaughlin, head of government relations at Buchanan Ingersoll & Rooney, the lead investigator. “Those who accepted the gift were really trying to put a square peg in a round hole and leverage the process for in-kind donations.”
Related news: State steps in to oversee investigation into questionable $237 million donation to Florida A&M University
Palm said he will work with Beard and the FAMU Foundation board to implement the recommendations. The information will be presented to trustees at their upcoming board meetings on Sept. 11 and 12.
Although FAMU Trustee Otis Cliatt felt the September deadline was appropriate — since Beard only started his interim role a few days ago and is still evaluating his staff while the fall semester begins on August 26 — Beard assured the board that the 30 days or so was plenty of time.
“Given the impact and consequences of this report, I think it’s a very high priority,” Beard said. “There’s still a lot of work to be done at this point.”
“Poor decision making… lack of common sense”
McLaughlin attended Thursday’s board meeting on the investigation to answer questions and clear up misunderstandings during the trustees’ discussion, which was led by Michael White, a FAMU trustee and chair of the audit and compliance committee, who worked with the Florida Board of Governors to hire the law firm for the investigation.
During the discussion of the report, FAMU Trustee John Crossman asked McLaughlin if there was any illegal activity or intent for personal gain on the part of university members involved in receiving the gift. The answer was no.
“What happened was poor decisions and – these are my words – it seems like there was a lack of common sense,” Crossman said.
In addition, Harper and trustee Kelvin Lawson wanted to know if the university still owned shares in Gerami and the Isaac Batterson Family 7th Trust. The transfer had already been declared void on May 14, McLaughlin said, adding that the stock certificates owned by the foundation had been canceled.
“Essentially, Mr. Gerami did not transfer the shares, he simply identified the foundation as the owner of 15 million shares,” McLaughlin said. “That is not a proper way to transfer the shares.”
McLaughlin also suggested to the board that the positions of vice president for university advancement and executive director of the FAMU Foundation should have separate roles within the university.
Before Shawnta Friday-Stroud, dean of the School of Business and Industry, resigned from both positions in the wake of the controversial donation, she had held those posts since her first permanent appointment in 2018.
“These two positions should check and balance each other,” McLaughlin said. “While the vice president for advancement is truly responsible for prioritizing the needs of the university, the executive director of the foundation is responsible for ensuring that incoming donations are properly allocated.”
The trustees did not specifically discuss whether the proposal regarding the roles would be taken up by the board.
“I would like to see how we try to restore the trust of many of the stakeholders here, especially the donors who give to this institution,” said FAMU Trustee Kenny Stone. “I think it’s important to voice the changes we’re going to make – and do it in the right way.”
Contact Tarah Jean at [email protected] or follow her on X: @tarahjean_.
