Investigator says ‘fraudulent’ gift to Florida’s only public historically Black university is void
A record multimillion-dollar gift to Florida’s only public, historically black university has been invalid for months, an independent investigator said Thursday. A third-party report found that school officials failed to verify a “fraudulent” contribution and that the donor’s self-promotion of his fledgling cannabis business was “unfounded.”
The little-known entrepreneur Gregory Gerami donation of more than $237 million was declared “invalid” ten days after the big reveal in Florida A&The M-University graduation ceremony was the result of procedural errors, researcher Michael McLaughlin told trustees.
Gerami violated the terms of his asset management account by initially transferring 15 million shares of stock improperly, according to an Aug. 5 report from law firm Buchanan Ingersoll & Rooney, PC. When the company terminated Gerami’s contract on May 14, McLaughlin said all stock certificates held by FAMU Foundation were canceled.
Furthermore, the foundation never co-signed the donation agreement, after both parties signed an incorrect version on the day it came into effect.
Thursday’s meeting came three months after that celebratory event. The university’s president posed onstage with a jumbo check next to Gerami, who had been invited to speak despite a documented history of questionable business ventures and failed higher education donations.
Things quickly fell apart. After almost immediate public outcry, the school stopped the gift and a vice president left her position. President Larry Robinson resigned last month.
Gerami, who founded Batterson Farms Corp. in 2021, did not immediately respond to a phone call seeking comment. He previously told The Associated Press that the full donation would be completed.
Millions intended for scholarships, sports facilities, the nursing school and a student business incubator are not being realized. Instead, they are being replaced by reputational damage and withdrawn contributions from previous donors who assumed the university’s financial windfall made additional gifts unnecessary, the report said.
The investigation blamed executives’ lack of due diligence on their overzealous pursuit of such a transformative gift and a lack of understanding of private stock donations. Robinson repeatedly told employees “don’t screw this up,” investigators said. Ignored warning signs cited in the report include:
1. An April 12 notice from financial services firm Raymond James retracting its previous verification of Gerami’s assets. In an email to two trustees, the firm’s vice president said that “we do not believe the pricing of certain securities was accurate.”
2. “Derogatory” information uncovered by the communications director while drafting Gerami’s graduation speech. That included a failed $95 million donation to Coastal Carolina University in 2020. The report said the official “chose to ignore these concerns and did not report them to anyone else, assuming others were responsible for due diligence.”
3. An April 29 anonymous tip to the ethics hotline that the Texas Department of Agriculture was able to substantiate alleges that Gerami is a fraudster. The Office of Compliance and Ethics reviewed the tip but took no action because the confidentiality of the gift meant the office was unaware of Gerami.
Senior management “was deceived by, and allowed itself to be deceived by, the donor — Mr. Gregory Gerami,” the report concluded.
“Neither Batterson Farms Corporation nor any of its affiliates had the resources to fulfill the promises made in the grant agreement,” the authors wrote.
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