USF President Judy Genshaft has been playing hide and seek with USF students, faculty and staff. She has been found. Not wholly engrossed in USF activities as one might think she should be, Genshaft is taking on a side project as a member of the board of directors of a new bank called American Commerce Bank, which has raised $100 million in startup capital.
Of that $100 million, Genshaft invested $135,000 to the bank, and USF Board of Trustees member Lee Arnold Jr., who will also sit on the bank’s board of directors, invested $1 million. So that’s where part of the money from her recent raise went: from the USF Foundation – where the money for her raise came from – right to potential money in Genshaft’s pocket, provided the bank does well.
The USF Foundation is a private, not-for-profit organization that, according its Web site, “accepts gifts in support of activities directly related to the mission of the University of South Florida” and is “committed to the highest standards of ethics and stewardship.”
To participate in an out-of-work activity, USF employees must gain permission from their immediate supervisor. Genshaft had to clear her out-of-work activity with Dick Beard, the chairman of the Board of Trustees. She wrote Beard a letter detailing her involvement with the bank, stating that she has “used due diligence to avoid any actual conflict of interest.”There may not be an initial appearance of a conflict of interest between Genshaft’s job as USF president and her involvement with the bank’s board of directors, but when examined carefully, the distinct possibility for corruption exists.
Arnold is on USF’s BOT – which is solely responsible for giving Genshaft two raises in 10 months – alongside Genshaft. So if the bank is doing well or more money is necessary for expansion, Arnold could theoretically push for raises so Genshaft could invest funds in the bank project without risking her own capital.
Of course, this is a hypothetical, but very real, possible scenario. Given the audible laughter that followed former Student Government President Bijal Chhadva’s protest of the prior of Genshaft’s raises, Arnold may not need to push very hard.
Yet, most of the University administration and higher-ups are content to leave it up to Genshaft to identify a conflict of interests if it ever arises. That does not seem like an effective use of a system of checks and balances for the leader of a public educational institution.In terms of time commitment, Genshaft said in her letter to Beard that it would only take up “one half day per month.” This is a seemingly low estimate, as one would imagine that starting up a bank is a difficult and time-consuming job.
Both the St. Petersburg Times and the Oracle tried to reach Genshaft for comment on her new role, and both publications were unable to reach her for comment. Guess she’s playing hide and seek again.