In what was supposed to be a historic donation to a historically Black college or university, a promised $237 million gift to Florida A&M University (FAMU) may turn out to be a hoax. Gregory Gerami, a 30-year-old who claimed to be Texas’ “youngest African American industrial hemp producer,” pledged the substantial amount, but the funds never materialized.
During the first weekend of May, FAMU celebrated Gerami’s purported contribution with much fanfare. Gerami spoke at commencement, and university officials posed with a large ceremonial check. He reassured everyone that “the money is in the bank.” It wasn’t, and now all signs point to the fact that it may never be.
Facing backlash for failing to properly vet Gerami and the donation, FAMU has paused the gift, dashing hopes of increased financial stability for the 137-year-old institution and its 9,000 students. Gerami insists the situation will resolve, but other universities he approached have yet to see any money.
An impressive yet dubious offer
Gerami contacted FAMU’s development office last fall, according to Shawnta Friday-Stroud, the then-vice president for university advancement. University officials, including President Larry Robinson and Athletic Director Tiffani-Dawn Sykes, began virtual meetings with him shortly afterward. In January, Atlanta’s Spelman College publicized a $100 million gift, the largest donation to any HBCU at the time. Gerami aimed to surpass that with a donation of 14 million shares from his fledgling industrial hemp company. However, the company’s value and those shares remain unclear.
Batterson Farms Corp, founded by Gerami in 2021, aspires to lead in hemp plastics production. While the Texas Department of Agriculture confirms the company’s hemp-growing license, little else suggests it’s operational. The company’s website is sparse, with broken affiliate links and non-functional shopping cart payment features. A confusing investor message warned of late fees for missed monthly payments.
Kimberly Sue Abbott, a founding board member incorrectly listed as co-CEO, doubted Gerami’s valuation of the shares, stating Batterson Farms “is not farming any hemp anywhere that I’m aware of.” She met Gerami around 2013 during her tenure on the Birmingham City Council and felt he needed guidance on using his money for good. He invited her to various ventures, none of which lasted.
“He never holds to a schedule. The information he provides is always flawed somehow. Technicalities are always an issue,” she said.
Greg Wilson, HempWood’s founder, confirmed Gerami as a customer but noted he doesn’t buy much. Wilson mentioned high interest rates affecting home sales and remodeling interest, impacting wood-alternative businesses.
Gerami dismissed Abbott’s claims as “inaccurate” and outdated. He did not specify whether Batterson Farms is growing hemp but said his company acts as an intermediary between farmers and consumers. He refused to disclose details about the company’s contracts, revenue and staffing. He claimed a third-party developer created the company’s website, which was never intended for direct sales.
Questionable Vetting and NDAs
FAMU officials have shared little about their knowledge of Gerami or their vetting process. Friday-Stroud told FAMU Foundation board members last month that an “expansive screening” produced the same information that surfaced “on social media,” referring to online scrutiny of Gerami’s past donation attempts and his company’s obscurity. Despite this, they proceeded after involving Robinson.
Friday-Stroud signed a nondisclosure agreement (NDA) on behalf of the foundation board on April 26 at Gerami’s request, according to a copy obtained by the AP. They announced the donation while awaiting an independent appraisal of the private stock’s worth, which Gerami assessed based on undisclosed sales contracts. Officials acknowledged the appraisal might return a much lower valuation. Stock donations and NDAs are not abnormal for university advancement offices. However, according to some higher education fundraisers, such donations usually come from wealthy shareholders of reputable public companies, and NDAs should include the entire foundation board.
“You want to make certain those resources are available, always, before you make the announcement,” said W. Anthony Neal, a longtime HBCU fundraiser who had dealt with Gerami in the past. “Because you don’t want to come back with egg on your face.”
Bob Musumeci, an Indiana University business professor with a background in corporate finance, stated that companies typically get what’s known as a 409A valuation from an independent third party before gifting shares. Equity ownership, employee numbers, financial projections, and other details factor into the assessment. Outside investments from things like a family trust can also boost a company’s worth beyond what sales numbers — and public data, if available — might suggest. Gerami didn’t break any laws by flouting that norm, Musumeci said, but the fact that the gift wasn’t properly assessed before being publicized is questionable.
“I would certainly be cautiously pessimistic about it. But I can’t say whether it is or it isn’t,” Musumeci said regarding the valuation’s accuracy. Both FAMU and Gerami have stated that the transfer of the stock certificates between their respective accounts took place in April. A spokesperson for Carta, the equity management company they said completed the exchange, confirmed that the platform notified Gerami on May 14 that his contract was terminated over “misrepresentations” he made. They declined to comment on FAMU’s assertion that it had an account with Carta and Gerami’s claim that the company sent documentation confirming the transfer.
Small Schools with Small Endowments
Florida A&M is not the first school to receive a pitch from Gerami. Neal, the HBCU fundraiser, was overseeing a $3.4 million fundraising campaign in 2023 for the 150th anniversary of Wiley University in Marshall, Texas, when Gerami reached out. They discussed funding for new campus facilities in the $1 million to $2 million range, Neal said, and he began the “normal vetting process” as the senior vice president of institutional advancement at the time. But not much information surfaced.
After at least seven conversations, Neal sought a one-on-one meeting to verify Gerami’s legitimacy in person. Communications subsequently dropped off.
“Sometimes donors just pull out,” Neal said. “Doesn’t mean anything bad.” However, three years prior, Coastal Carolina University also withdrew from a $95 million contribution made by an anonymous donor because he had “not fulfilled an early expectation of the arrangement,” according to a press release. While CCU declined to name the anonymous donor in an email to the AP, Gerami was identified as the benefactor last spring by The Sun News in Myrtle Beach, South Carolina.
Gerami told AP that he “considered” as many as 15 colleges and universities in recent years as part of a strategy to establish research partnerships that he said would make his company eligible for grants. Though Gerami did not disclose the names of those schools, those documented are all small institutions with scant endowments. He said he eyed institutions that needed funding and had the capacity for hydroponics, a method of growing plants without soil.
A Transformative Gift Gone Sideways
The fallout at FAMU is palpable. The school ended its engagement with Gerami. Friday, Stroud resigned. University trustees — surprised they were left in the dark throughout the six-month process — approved a third-party investigation that state officials have joined. Speaking May 15 before the trustees, Robinson described the announcement of Gerami’s gift as “premature at best.”
“I saw in this unprecedented gift the potential to serve our students and our athletic programs in ways unimaginable at that time,” Robinson said. “I wanted it to be real and ignored the warning signs along the way.”
Days after announcing the donation, Robinson withdrew a $15 million request to a local economic development board to enhance FAMU’s football stadium, according to records obtained by the AP. While he did not give a reason and the university declined to comment, the gift agreement shows a one-time $24 million allocation of Gerami’s donation for athletics facilities. Millions annually were also supposed to fund scholarships, the nursing school, and a student business incubator over the next decade.
The public embarrassment has worried some HBCU supporters, who hope the outsize negative attention won’t dampen an otherwise resurgent fundraising atmosphere.
“As somebody that wants HBCUs to always succeed, this is really heartbreaking because there was so much excitement,” said Marybeth Gasman, an education researcher at Rutgers University and three-time HBCU board member. “Just real, real excitement for just a transformative gift of this magnitude.”
There was a time when HBCUs might have had to gamble on an unknown miracle donor, but Gasman said that’s less common now. Long overlooked by foundations and underfunded by some states, the schools have courted and gained newfound corporate interest in recent years.
Still, public funding disparities persist. Historically Black land-grant universities in 16 states missed out on $12.6 billion over the past three decades — including $1.9 billion that should have gone to FAMU — according to a 2023 Biden administration analysis.
For his part, Gerami believes the questions over his donation are unnecessary “whack-a-mole.” He admitted the sum of his donation was his own estimate, but said he expects an independent valuation will confirm the shares’ worth within the month. He said he also believes FAMU will accept the gift once its independent probe is complete.
“Until a third-party valuation is done, this is all speculation,” Gerami said. “We want to tread very carefully because we do not want to play games that lead to speculation without actual, factual information,” he added.
Associated Press contributed to this report.