University of Georgia; Another Day Another Scandal
It seems like everyday some major college is embroiled in scandal for one reason or another, and UGA is trying real hard to claim the top prize in athletic scandals. First it was Jim Harrick in 2003, when Georgia found that there was academic fraud committed involving Jim Harrick Jr., who granted credit hours to three players who did not attend the class in basketball strategy he was teaching, and now former football coach Jim Donnan is allegedly involved in a failed Ponzi scheme which has enevloped coaches from Virigina to Texas. It has been alleged that Donnan who formed GLC Enterprises in March 2004, solicited investments from more than 50 individuals and entities and made commissions ranging from 15 percent to 20 percent for any new investments solicited. According to court documents, investors contributed nearly $82 million into GLC Enterprises, but less than $12 million was spent on inventory and at least $13 million in investor money remains unaccounted for. As revenues declined, it is alleged that GLC eventually used money from new investors to pay old investors, which, according to the court documents, constituted a Ponzi scheme. At this time, Donnan's role in GLC is disputed as court documents indicate the Donnan informed potential investors that he was an officer in the company and indicated he was the vice president and secretary on different occassions. This is an assertion which Donnan's attorney denies. The Donnan's have invested over $5.4 million in the company and have offered to pay GLC's creditors $5 million of the $8.25 million demanded, and when that amount was not accepted, the Donnan's filed for Chapter 11 bankruptcy protection. While, this alleged Ponzi scheme will never be compared to the Madoff scandal, it serves as another black eye on the college athletics landscape, especially as high profile current head coaches are involved. At this point, there has been no independent investigation undertaken by UGA and there probably will not be one as there are no allegations that any criminal activity occurred when Donnan was coach from 1996 to 2000.
My name is Christopher Fusco. I am the managing partner of Callahan & Fusco, LLC with offices in New York, New Jersey, and Pennsylvania.