Quantcast

VUU president accused of fraud

Jeremy M. Lazarus | 2/1/2018, 10:46 p.m.
Dr. Hakim J. Lucas was supposed to be the ideal fit when Virginia Union University’s board named the 40-year-old as ...

Dr. Hakim J. Lucas was supposed to be the ideal fit when Virginia Union University’s board named the 40-year-old as the historic institution’s 13th president in August.

Dr. Lucas, who came to VUU from Bethune-Cookman University in Daytona Beach, Fla., where he was vice president, was described as a person who could be effective with students. He was touted for his ability to connect with the larger community and said to know the ins and outs of fundraising based on his experience in generating dollars for Bethune-Cookman and Medgar Evers College in Brooklyn, N.Y.

But just five months after his appointment at VUU, the board’s decision is looking questionable in the wake of a lawsuit filed by Bethune-Cookman University accusing Dr. Lucas and two other former top officials there of participating in a scheme to defraud Bethune-Cookman of millions of dollars.

At the heart of the lawsuit is an allegation that Dr. Lucas and his fellow conspirators took bribes to rig a deal with private developers that saddled Bethune-Cookman with a 40-year lease on a privately built dorm that will cost the school an astonishing $306 million over the life of the lease if the deal is allowed to stand.

Dr. Lucas and VUU board members have declined to directly comment on the allegations in the lawsuit, including a claim that Dr. Lucas had been suspended for violating Bethune-Cookman’s policies just three weeks before VUU hired him.

VUU issued an umbrella statement on behalf of the board and Dr. Lucas in response to the suit:

“Virginia Union University, under the direction of Dr. Hakim Lucas, is committed to providing an enriched educational experience for our students and the community,” the statement reads.

“VUU utilized a thorough and standard search and vetting process with a private third-party entity in the hiring of Dr. Lucas. It is not appropriate for VUU to comment on any reports of specific litigation in Florida as we are not involved.

“Dr. Lucas has retained private counsel and denies any wrongdoing in connection with his prior employment.”

In addition to Dr. Lucas, the civil lawsuit was filed against Bethune-Cookman’s former president, Edison O. Jackson; Bethune-Cookman’s former chief financial officer, Emmanuel Gonsalves; two developers, Mark O. Glover and Darrell L. Dailey; and four companies the two developers own and control.

Dr. Lucas and his fellow defendants have not yet filed responses to the suit that Bethune-Cookman filed last week in Volusia County Circuit Court, which serves Daytona Beach.

In the lawsuit, Bethune-Cookman alleges that Dr. Lucas, Dr. Jackson and Mr. Gonsalves worked with the developers, Mr. Glover and Mr. Dailey, to win approval from the school’s board to build a dorm for 1,200 students that was to be leased back the school, which lacked the finances and credit to built its own.

According to the suit, Dr. Lucas and Mr. Gonsalves “took control of, and corrupted the ‘review process’ for multiple competing bids that were presented to an internal committee.

“Dr. Lucas and Mr. Gonsalves manipulated and mischaracterized the competing bids” and pressured committee members to accept their favored development, the suit alleges.

The suit also alleges that both men, as well as Dr. Jackson, accepted bribes to support the project and that Dr. Lucas and Mr. Gonsalves, with Dr. Jackson’s consent, passed out “hush money” to keep various lower-level Bethune-Cookman employees from blowing the whistle when they learned some of the facts.

The suit alleges that the three top officials allowed developers to secretly inflate the price for the project from $72 million to $84 million to create a slush fund for bribe payments. At least $5.6 million was funneled back to the developers, the suit alleges.

The three top officials also allowed the developers to drop plans to include a student union and retail space in the project without any notice to the board, the suit claims, reducing the value of the building to the school even further.

Meanwhile, Dr. Jackson sold the board on the plan with help from Dr. Lucas and Mr. Gonsalves, the suit alleges. According to the suit, the school’s board was told Bethune-Cookman would pay nothing up front for the new building, but could expect to gain $260 million from student rents over the lease’s 40-year term.

However, the suit states that the board was never told that Bethune-Cookman would be on the hook for $306 million, a huge debt for an already struggling private school that resulted in a precipitous fall in its credit rating.

The suit asks for the deal to be voided and for all the defendants to pay triple damages for their actions. The school also asks to be allowed to purchase the building at its appraised value, which the suit states is below the $72 million developers advertised as the cost of construction.