FAU Dissapointed Over Retraction of $16 Million Pledge

Barry Kaye, 81, a former insurance magnate, has been an FAU donor since 2005 when he pledged $5 million to the school's College of Business. In 2007 Kaye increased his pledge to $16 million and agreed to pay installments over five years.

Part of the money was used to establish a Barry Kaye School of Finance, Insurance and Economics.

FAU will now be removing Kaye's name from that school as Kaye has told FAU fundraisers he will be unable to fulfill his $16 million pledge, the largest in FAU's history.

Kaye agreed to write the school a final $1 million check, bringing his gift total to the original promised $5 million, and asked to take his name off the College of Business. FAU accepted the revised agreement.

FAU programs are not expected to be impacted, spokeswoman Kristine Gobbo explained.

"Programs and faculty hires are not put in place until the funding is received from the donor sponsoring that particular program or faculty member," she said.

"There's no question it's a disappointment," said Norman Tripp, former chairman of the FAU board of trustees. "I think he's just suffering as other people are doing with the economic times. I think [FAU officials] have to be thankful they received the money they did. But on the other side, when a pledge isn't completed, you can't keep the name on the school."

There had been questions about FAU's policies on donor relations due to Kaye's involvement with the university. Critics believed Kaye wanted a business relationship with FAU, not just a philanthropic relationship.

In 2007 Kaye hosted seminars on the campus regarding life settlements, the process of buying insurance policies from the elderly and then cashing them out when they die. He proposed taking out life insurance policies on FAU donors to raise money for the university. Kaye would have made money by brokering the deals.

"He always wanted to sell. You can't fault him. He's a good salesman," said Pamela Peterson Drake, a former associate dean in the College of Business. "But I don't think he fully understood you can't use a university for those purposes."

Kaye's $5 million pledge is the third largest in FAU history.

"There aren't too many people who have given that kind of money to the university," Kaye said. "I feel very good about thing the things I was able to accomplish."

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