Four former board members of the New College Foundation threatened to sue the school’s leadership Thursday, alleging that it inappropriately used donor money to pay for the school’s athletic program and President Richard Corcoran’s nearly $700,000 salary.
The draft complaint, emailed to New College leadership, alleges that Corcoran and foundation head Sydney Gruters may have used more than $1 million in foundation funds against the wishes of the original donors to pay for the school’s growing financial reliance on its endowment.
The New College Foundation is a direct support organization, a separate legal entity from the school that collects and distributes donations on behalf of New College.
Among the prospective plaintiffs is former alumni association chairperson Ben Brown, who resigned from the foundation board in March, citing concerns of mismanagement. Brown said the foundation refused to allow directors who oversee its operations the chance to review financial documents indicating the original intent for donated funds.
The four former foundation directors were concerned about the misallocation of donor funds for years, Brown said. But those concerns have only grown as the school’s spending grew under Corcoran’s leadership.
“It doesn’t seem plausible that the foundation can spend as much as it does on athletics and presidential salary without relying on restricted donor funds,” Brown said.
“This is a symptom of business problems over at the college,” he said. “It’s become a financial nightmare, and someday people will have to pay the piper for what’s been done. The responsible thing to do as a citizen is ringing the alarm bell.”
The draft complaint further alleges that “there have been instances where directed gifts for scholarships have not been awarded, despite the presence of students who met the scholarship requirements.”
The alumni said Corcoran and Gruters defamed former and current foundation directors by asserting that they breached their fiduciary oversight of foundation funds.
They demand financial records showing donors’ original intent and how the funds were actually used by the school, according to the letter.
If the school does not comply with the former directors’ demands by June 5, they intend to file the lawsuit in Sarasota, the letter states.