Dive Brief:

• The former CFO of Indian River State College Marvin Pyles filed a civil suit against the school, its President Timothy Moore and its board of trustees alleging whistleblower retaliation, defamation and breach of contract by his former employer. Pyles served as CFO and VP of administration and finance at the college from April 2021 before his employment was terminated “for convenience” on April 19, 2024.
• The suit, filed Feb. 25 in Florida’s St. Lucie County Circuit Court, alleges Pyles’ employment at the Fort Pierce, Florida.-based institution was terminated in retaliation for raising concerns about misuse of funds.
• In a Tuesday press release on the suit shared with CFO Dive, Pyles cites messages, including screenshots of texts, between the former CFO and IRSC President Moore detailing the mismanagement. “When I landed as the CFO, I discovered that it was a financial mess,” Pyles told CFO Dive regarding the suit, noting the college had been operating in the red for years. During his tenure as CFO, he uncovered millions in fraud — described as a “$75 million mismanagement scheme,” according to one text message exchange cited in the release —  including false vendors and purchase orders and improper management of donor funds, he said.  

Dive Insight:

The complaint alleges numerous instances of fraud which Pyles disclosed to IRSC leadership, including the board of trustees — appointed by the governor of Florida — President Moore, and other members of the school’s administration.

That includes: improperly funneling state-funded nursing grants to the IRSC Foundation, a non-profit entity; breach of statutory duties related to the “effective management and oversight of federal, state and college funds,” as well as IRSC Foundation and donor funds; “misfeasance, misuse, and the improper diversion of state, foundation, and donor funds under President Moore, the IRSC Board of Trustees, and the 501(c)(3) IRSC Foundation Board of Directors;” and multiple violations of Florida statues surrounding external vendor contracts and college employee rights, according to the complaint.

One example Pyles pointed to was the rollout of a new ERP system, where implementation costs of $8 million were approved by the board and it “ballooned up to about $26, $28 million,” he told CFO Dive. In investigating the jump, Pyles identified false vendors and purchase orders: all told, “We submitted 175 purchase orders under $10,000 to go to a so-called vendor or company that we're working with, which was just a mailbox,” he told CFO Dive.

“That's when I saw there [were] financial problems, there was financial irregularities,” Pyles said, noting that over the course of the next year and a half, he kept uncovering “more and more.”

The disclosures ultimately led to hostile and adverse actions against Pyles, according to the complaint, which ultimately culminated in his April 2024 termination.

The suit also alleges that at the time of the termination, Moore stated in front of witnesses “in regard to plaintiffs consistent disclosures of fraud, waste and abuse, ‘you had to keep pushing.... You couldn’t leave any of it alone.... You keep bringing up all the issues.’”

The text message exchanges between Moore and Pyles include details of the fraud, including use of foundation funds for personal trips. 

“Profligate credit card spending. Trips to Europe for the whole family paid for….wait for it…by foundation funds,” one such message written to Pyles from Moore reads, according to a screenshot included in the Tuesday press release referring to an unnamed employee.  

The civil suit follows after Pyles, after originally filing a grievance with IRSC, filed a formal whistleblower complaint with the Florida Commission on Human Relations regarding the fraud. The commission ultimately declined to accept the complaint on the grounds that it lacked jurisdiction and that the college was not an executive branch state agency, per the complaint.

With the suit, Pyles is seeking reinstatement of his position or an equivalent position, backpay of wages, and damages up to $50,000 for each count, as well as requesting a jury trial, according to the complaint.

“Indian River State College does not comment on pending litigation,” an IRSC spokesperson told CFO Dive in an emailed statement. “Dr. Pyles has raised the same complaints in other forums and each time has been unsuccessful.”