FAMU Puts $237 Million Donation on Hold Amid Questions Over Donor's Credibility

Florida A&M University puts a record-breaking $237 million donation on hold due to concerns over the credibility of the donor and the gift's value. The university's leadership faces scrutiny over the handling of the donation and the lack of transparency surrounding the process.

author-image
Aqsa Younas Rana
New Update
FAMU Puts $237 Million Donation on Hold Amid Questions Over Donor's Credibility

FAMU Puts $237 Million Donation on Hold Amid Questions Over Donor's Credibility

Florida A&M University (FAMU) has decided to put a record-breaking $237 milliondonationon hold due to concerns over the credibility of the donor, Gregory Gerami, and the value and source of the gift. The donation, announced on May 4 during the university's annual commencement ceremony, was made by Gerami and the Isaac Batterson Family 7th Trust of Batterson Farms Corporation.

Why this matters: The controversy surrounding this donation raises concerns about the transparency and accountability of large gifts to educational institutions, which can have a significant impact on their financial stability and academic programs. It also highlights the importance of thorough vetting and due diligence in ensuring the credibility of donors and the legitimacy of their gifts.

The donation, believed to be the largest ever received by a historically Black college or university (HBCU), was presented in the form of millions of shares of stock, with an estimated value of at least $239 million. An additional $61 million was pledged to be donated over the next 10 years. The gift is nearly double the value of FAMU's $121 million endowment.

However, questions quickly arose about Gerami's credibility, particularly due to his past dealings. In 2020, he presented a $95 million gift to Coastal Carolina University, which ultimately fell through. Experts have also raised concerns over the valuation of the stock, with Professor Rebel Cole of Florida Atlantic University stating,"Where does this valuation come from? It raises more questions than it answers."

Members of FAMU's board of trustees expressed reservations about the donation, leading to the decision to put it on hold. Vice Chair Deveron Gibbons called for greater transparency regarding the circumstances surrounding the gift. Foundation members also expressed frustration over the lack of transparency in the donation process, with member Chekesha Kidd asking, "How did we get this far without knowledge of the transaction or the donor?"

President Dr. Larry Robinson announced the decision to pause the donation process at an emergency meeting of FAMU's fundraising foundation on May 9. "With regards to the gift and the processing of it and so forth, in terms of future processing, we've already decided it's in our best interest to put that on hold," Robinson stated. Vice President for University Advancement Shawnta Friday-Stroud defended the initial decision to accept the gift, saying, "Yes, there is clearly a risk, and we are seeing that in everything that has shaken out. But at the time, that was the decision."

The donation was initially intended to support student success initiatives and athletics at FAMU, potentially benefiting students and faculty for generations to come. However, university officials were bound by a non-disclosure agreement, which prevented them from discussing the gift publicly. The university community had expressed skepticism about the donation from the start, leading to the emergency meeting and the decision to pause the process.

The fate of the $237 million donation now remains uncertain as FAMU conducts further due diligence on Gerami and the source of the funds. The university's leadership faces scrutiny over their handling of thegiftand the lack of transparency surrounding the donation process. As the situation continues to unfold, the FAMU community awaits more details on the future of this potentially transformative but controversial donation.