Aug 16, 2012
Atlanta — North Carolina State University basketball coach Mark Gottfried lost more than $300,000 in an alleged Ponzi scheme run by a former University of Georgia football coach, records show.
Gottfried is among a group of creditors who claim to have been bilked by Jim Donnan, his wife Mary, and GLC Ltd. Donnan and his wife filed for bankruptcy protection this month. GLC is being restructured, and the documents were filed by the company's current operators.
Jim Donnan is a North Carolina native who played football and tennis at N.C. State before moving into coaching. He spent time at Oklahoma, Marshall and the University of Georgia before a stint at ESPN. In 2009, Donnan was inducted into the College Football Hall of Fame.
Documents claim the Donnans solicited investors for GLC, a company that bought up unsold inventory from retailers to sell at wholesale prices. They made commissions of about 15 percent on each new investments. The filing says Donnan invested more than $5.4 million in the company and that his family ultimately made more than $14.5 million from bringing in more than 50 investors.
GLC's new owners claim, "A tremendous disparity exists between amounts invested in GLC by investors and the actual inventory purchases by GLC." They blame the Donnans for causing GLC to default on financial obligations and allege the Donnans filed for their bankruptcy to avoid GLC's claims.
Gottfried's loss totaled $337,500, according to the bankruptcy filing. Other investors included former University of Alabama and Texas A&M football coach Dennis Franchione, former University of Georgia and NFL player Kendrell Bell and University of North Carolina booster Maurice Koury.
According to the terms of a deal struck Thursday, GLC investors can seek to recover up to 80 percent of the money they lost, although they are likely to see much less.
Donnan's attorney, Ed Tolley, didn't return calls seeking comment, but he has denied allegations of wrongdoing.
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