| Dear OI Thank you very much for your inquiry. My friend in the garden, Susan Gruber helped me with this one. See below. It sounds like Botrytis (aka grey mold). Take a look at the pictures on this link - it has some great info for identifying all kinds of Hibiscus problems.
http://www.geocities.com/hibiscusred/bug/bug.htm#PEST Here is some info from CT Extension on control: from http://www.ct.gov/caes/cwp/view.asp?a=2823&q=377734
Botrytis blight or Gray mold, Botrytis cinerea.
This disease is an occasional problem, especially when the plant is in flower. Infected flowers develop tan, papery patches and are often covered with gray, fuzzy masses. Senescing flowers are particularly susceptible. Tan to brown spots with a target-like appearance can also develop on the leaves. These patches are often associated with flowers which have dropped onto the leaf surface. Good sanitation practices including grooming the plants and removing spent or senescing flowers can minimize the potential for infection. These affected tissues should be carefully removed and discarded when they are dry. It is also important to avoid wetting the flowers when watering and crowding plants. Adequate spacing between the plants can promote good air circulation. Control can also be achieved with the use of fungicide sprays applied as soon as symptoms are visible. Among the compounds registered for use in Connecticut are potassium bicarbonate, mancozeb, copper hydroxide, and thiophanate-methyl. Consult the label for dosage rates, safety precautions, and indoor use. Again, thanks for the question and let me know if you have more. Respectfully Trey Rogers, The Briggs & Stratton Yard Doctor, YardDoctor.com | 
