An independent investigation found that a $237.75 million donation to Florida A&M University was fraudulent, citing significant mishandling, lack of due diligence, and improper influence from former university leaders.

An independent investigation report published on Monday determined that a $237.75 million donation to Florida A&M University (FAMU) was fraudulent, noting significant lapses in the university’s handling and due diligence of the gift.

The probe found that the donation, announced by Gregory Gerami, CEO of Batterson Farms Corporation, lacked a valid basis, alongside several layers of mishandling including leadership influence, secrecy, a rushed timeline, and insufficient understanding of private stock.

Former President Larry Robinson and Dr. Shawnta Friday-Stroud, former Vice President for University Advancement, who have both since resigned, were central to the donation’s acceptance, the investigation found. The report noted that their roles created pressure to proceed without proper scrutiny. Secrecy agreements limited wider consultation, with only a select few aware of the donation details, resulting in a transparency deficit.

“Typically, a 409A valuation from an independent third-party is obtained before gifting shares, but this step was not taken, raising concerns among members of the University Board of Trustees and the Foundation Board of Directors about the true value of the Major Gift,” the investigation report states.

The donation was announced during FAMU’s commencement on May 4, purportedly the largest ever to a Historically Black College and University (HBCU). However, within hours, concerns were raised by other institutions and individuals familiar with Gerami.

Gerami, who portrayed himself as a successful entrepreneur, was found to have a history of fraudulent activities and manipulative tactics. Despite claims of multiple business affiliations, corporate records only confirmed Batterson Farms Corporation. His ventures were marked by unverifiable progress and inconsistencies.

In 2020, Gerami promised $95 million to Coastal Carolina University, but the deal fell through, leading the university to cut ties with him. Upon the discovery, it prompted FAMU’s Board of Trustees to pause the gift and initiate the investigation. According to the university, he first reached out to the FAMU Office of University Advancement’s Audrey Simmons Smith in fall 2023 about making a “sizable donation.”

The urgency to announce the donation at commencement led to Keith Miles, the institution’s Director of Communications, recommending the announcement without consulting Robinson.

FAMU relied solely on Gerami’s valuation of the gift, neglecting an independent assessment, indicating a severe due diligence failure. The investigation also identified a lack of a clear protocol for raising concerns, compounding the issue.

The report recommends revising FAMU Foundation policies to give the Foundation Board of Directors sole discretion over significant gifts. It also advises establishing strict procedures for accepting private stock donations and separating the roles of Vice President for University Advancement and Executive Director of the Foundation to enhance oversight and accountability.