A legal battle is brewing at New College of Florida, as several former Foundation board members have announced their intention to file a lawsuit against the New College Foundation, demanding transparency and accountability regarding the organization’s financial management.
The Core Dispute
On May 22, former directors of the New College Foundation sent a formal legal demand letter to President Richard Corcoran and Foundation leadership, threatening litigation unless the Foundation provides comprehensive financial records and documentation. The lawsuit centers on allegations of financial mismanagement and the misuse of donor funds.
The key players in this dispute include prominent former Foundation leaders:
- Sue Jacobson, former Foundation Board Chair
- Henry Smyth, former Investment Committee Chair
- Ben Brown, former Alumni Association Chair
The controversy stems from New College’s release of an internal investigative report in late 2024, followed by public statements that appeared to blame former Foundation administrators and directors for the organization’s current financial problems. However, the former board members point out a critical flaw: the investigation only covered issues before July 2023, yet attempted to absolve current leadership of responsibility.
- As former Alumni Association Chair Ben Brown stated, “This administration focuses on excoriating those who served in the past. But the evidence of problems is greater than ever, under the current administration.”
Serious Allegations
The legal complaint outlines several concerning financial practices that allegedly occurred under the current administration:
Missing Documentation: Board members repeatedly requested access to donor agreements and directed donation documentation, but were told such records either didn’t exist or were impossible to locate. Suspiciously, the former board members claim that all donor contracts were placed in a locked filing cabinet before the 2023 “takeover” of New College of Florida and its Foundation.
Questionable Investment Moves: The Foundation allegedly made an urgent request to its brokerage (Rothschild) for over $3.15 million, then claimed it only needed approximately $1.7 million. The plaintiffs question whether these funds were properly allocated and whether they included directed donations that should have been restricted for specific purposes.
Scholarship Fund Concerns: The complaint alleges that directed gifts for scholarships have not been awarded despite the presence of students who met the criteria, raising concerns that these funds are being “dissipated with administrative fees” in violation of donor intent.
Budget Discrepancies: The Foundation’s own budget documents show significant inconsistencies. While public documents indicated $3.532 million in unrestricted funds for FY 2024, the actual budget showed only $2.326 million available. This suggests that over $1.2 million may have been improperly used for unrestricted disbursements.
Excessive Spending: The complaint also alleges that the Foundation’s spending rate exceeds the 3.5% spending rate authorized by the Board at their June 16, 2023, meeting.
The Demand for Transparency
Former Foundation Board Chair Sue Jacobson summarized the group’s concerns: “We think the Foundation’s real financial condition is at variance with the image presented by the highly selective information it releases to the public.”
The former board members are seeking:
- Complete financial records showing all fund outflows
- All documentation regarding directed donations
- Verification of whether directed donations have been properly sequestered or misused
- A forensic analysis of all financial records
The former board members sent a draft complaint to President Corcoran, offering the college an opportunity to settle the matter without formal litigation. However, if an agreement isn’t reached by June 5, they plan to file the lawsuit in Sarasota County Circuit Court.
The group has indicated that additional plaintiffs may join the case, and the final complaint may differ from the draft version.
The Bigger Picture
Will the University of West Florida have similar transparency issues when Manny Diaz takes control?
