MacKenzie Scott’s historic $20 million donation to a community college is now mired in controversy amid ongoing investigation

MacKenzie Scott has made thousands of donations over the past few years, totaling an eye-popping $26 billion. Organizations focused on myriad causes including education, DEI, disaster recovery, and more have often said these gifts are record-breaking or life-changing—and much of it goes back to Scott’s philosophy: trust-based philanthropy.

But there’s one gift that wasn’t used as intended, at least according to some stakeholders. In 2021, Scott, the billionaire philanthropist and ex-wife of Amazon founder Jeff Bezos, donated a record $20 million to Santa Barbara City College (SBCC)—the largest gift in the school’s 112-year history. The gift came at a time when SBCC and U.S. community colleges were facing a “serious enrollment decline” due to the pandemic, according to an SBCC statement from 2021.

“This gift is an act of incredible generosity and due to its unrestricted nature, a demonstration of tremendous trust in our community’s college,” former SBCC Foundation CEO Geoff Green said in the 2021 statement. “It reinforces the importance of providing quality higher education that is accessible to everyone.”

But in late January, the SBCC Board of Trustees disclosed that about $10.5 million of that gift had been spent without explicit authorization from either the foundation’s board, college officials, or the trustees themselves. 

“The Board of Trustees has initiated its own investigation into what occurred, consistent with its commitment to sound governance and public trust,” according to a Jan. 30 statement. “The use of the MacKenzie Scott gift will be on the February 19, 2026, Board of Trustees agenda for an initial discussion and to hear public comment.”

That gift was supposed to be the kind of feel-good story that has become Scott’s signature: a record donation to a community college that could turbocharge access for low-income students. Instead, the money has become a flashpoint over governance, transparency, and what happens when a “no-strings” philosophy meets a public institution’s accountability rules.

Still, the funds largely underwrote the college’s Promise Program, which covers tuition, books, and supplies for roughly 1,800 local students each year. The problem was the funding was never approved. 

Internal review

About $10.5 million of Scott’s gift was used toward the program from 2021 to 2024, Bobbi Abram, CEO of the SBCC Foundation, told SFGATE, and about $13 million of Scott’s gift is left, according to a Board of Trustees statement. 

Abram, who took over the SBCC foundation in 2024, ordered an internal review after spotting accounting discrepancies, but told People the gift wasn’t “misused.”

“More than 1,800 local students are supported by the Promise each year. This is a nationally recognized program which makes higher education accessible for local families,” Abram told People. “Using some of the Scott gift funds for the Promise was not a ‘misuse.’ It was entirely consistent with the Foundation’s mission and in the spirit of the donor’s intent.”

Instead, Abram chalked it up to just an “accounting process failure” and a “lack of transparency” and claimed they “now have it corrected.”

Still, the board of trustees launched its own investigation and will have a public discussion on the matter on Thursday.

SBCC didn’t immediately respond to Fortune’s request for comment. Scott and her philanthropic foundation, Yield Giving, could not be reached. 

Scott’s trust-based philanthropic philosophy 

Scott, who is worth an estimated $38.5 billion, has a signature playbook for her donations. She has a no-strings-attached approach, meaning recipients can use the donations however they choose. That’s quite different from how other philanthropic donations are handled; they’re often made for a specific purpose and require more oversight and check-ins from the donor.

“She practices trust-based philanthropy,” Anne Marie Dougherty, CEO of the Bob Woodruff Foundation, told Fortune of Scott, who donated $15 million to the veteran-focused nonprofit organization in 2022, and made a subsequent $20 million donation last fall.

With that initial $15 million gift, the Bob Woodruff Foundation established a three-year plan to invest an additional 20% each year for the past three years in programming. 

“There were a couple things we did not do,” Dougherty explained. “We did not establish an endowment, we did not hire a bunch of people, we did not buy real estate, open up an office, anything like that. We just increased our grant making.”

That level of trust bestowed by Scott proved a game-changer for the Bob Woodruff Foundation and for thousands of other organizations to which she made donations. 

To be sure, Scott’s foundation, Yield Giving, has a thorough due diligence process, Dougherty said, including sharing information such as the organization’s strategic plan, audited financials, business plans, organization chart, and grant-making process. But after the donation was received, Scott’s organization was hands-off.

“Unlike traditional funding processes that often involve lengthy applications, specific restrictions, and reporting requirements, her style empowers organizations like ours to determine how best to direct funds quickly and innovatively to address pressing issues,” Noni Ramos, CEO of Housing Trust Silicon Valley, told Fortune in late 2024, when her organization received a $30 million gift from Scott.

This story was originally featured on Fortune.com