Former Georgia and Marshall head coach Jim Donnan is accused of luring several friends and coaching associates into a “fraudulent $80 million investment scheme” and is on trial facing federal charges including conspiracy, mail fraud and wire fraud. Donnan reportedly convinced several prominent coaches to invest including Virginia Tech’s Frank Beamer, Texas State’s Dennis Franchione, Cincinnati’s Tommy Tuberville and former Dallas Cowboys coach Barry Switzer.
The 69-year-old Donnan allegedly ran the scheme with Gregory Crabtree through GLC Limited Inc., a West Virginia-based company “that dealt in closeout merchandise,” and sold investments while “promising rates of return ranging from 50 percent to 2000 percent,” according to the AP.
Crabtree pleaded guilty to conspiracy last month and will testify in Donnan’s trial.
Prosecutor Paul McCommon said that the two worked together, but Donnan “called many of the shots.”
“It was Mr. Donnan who recruited the investors. It was Mr. Donnan who determined who got paid, when they got paid and how they got paid,” McCommon said. “These people invested in GLC because they trusted Mr. Donnan.”
Prosecutors said Donnan and Crabtree rained “more than $81 million from 94 investors” between September 2007 and October 2010. The scheme came crashing down in late 2010.
The scheme crumbled in late 2010 when GLC was no longer able to pay the rates of return investors that had been promised and the company began missing interest payments, prosecutors have said. An investor reorganizing committee was appointed and it was discovered that the company had no means to control or track inventory or measure profits and losses.
Ed Tolley, Donnan’s attorney, said that Donnan “thought he’d found a good investment and wanted to share his good fortune with others” and that Crabtree tried to capitalize on Donnan’s celebrity.
“Jim Donnan was the first investor in GLC and, we say, the first victim,” Tolley said.
Donnan, who was fired by Georgia in 2000 and hasn’t coached since, led Marshall to the I-AA National Championship in 1992 and coached UGA to four straight bowl wins in the late 90’s. Between Marshall and Georgia, Donnan registered a 104-40 combined record. He also served as an assistant coach at NC State, Florida State, North Carolina, Kansas State, Missouri and Oklahoma from 1969-1989 before getting hired at Marshall.
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