by Aloysius St. Bernard
Nathan Gorman has been terminated from his position as Director of the Peyton Randolph University Foundation, after deep losses to the university’s endowment fund landed the institution, one of Virginia’s oldest, on a Department of Education list of colleges that failed to pass a test of financial responsibility.
PRU’s appearance marked the first time a public university made the list, which usually profiles private institutions, and highlights those which may need closer oversight from the government. According to DOE spokesman Gerald Hendershot, PRU made the list due to the size of the loss, and what he termed “a highly risky investment strategy” created by Gorman, including investments in small alpaca farms, counterintuitive stock purchases, and monthly “investment junkets” to Atlantic City, New Jersey.
Director of University Relations Tom Mifflin was asked for public comment on the situation, but referred all questions about Gorman’s dismissal to the University’s General Counsel, Alice Higgenbottom. Gorman, however, was happy to discuss the situation and provide his perspective, in an interview on Thursday, where his attorney was also present.
“Look, those ratings are only part of the picture,” he countered. “They represent the position of our endowment portfolio on the day the snapshot was taken. Investments portfolios gain and fall and then gain again. The day they took our snapshot just wasn’t our day. I could’ve totally turned this thing around, but I wasn’t given a chance.”
Against the advice of his lawyer, Laurie Shively, Gorman offered three examples to “shed light on the big picture.” These examples (and his rationale for the investments) are included in the infographic accompanying this article. In a prepared statement on behalf of the university, Ms. Higgenbottom noted that the university has asked for the assistance of the Federal Bureau of Investigation and the Securities and Exchange Commission in looking into the matter. Further information will be released once it becomes available.