Ten days before President-elect Donald Trump was set to go to trial on one of three fraud lawsuits involving his defunct Trump University, the parties involved in all of these cases have reached a settlement worth $25 million.
The deal will close the books on allegations that the unlicensed school defrauded students who paid large sums of money to learn real estate investment from experts handpicked by Trump, only to allegedly be taught by people with little to no background in the field.
There were three lawsuits in total — two filed in California and one brought by New York State Attorney General Eric Schneiderman.
“I am pleased that under the terms of this settlement, every victim will receive restitution and that Donald Trump will pay up to $1 million in penalties to the State of New York for violating state education laws,” Schneiderman said in a statement. “The victims of Trump University have waited years for today’s result and I am pleased that their patience–and persistence–will be rewarded by this $25 million settlement.”
An attorney for Trump University did not yet respond to comment from Reuters.
According to the NY AG’s lawsuit against the company, Trump University, which was launched in 2004, had been advised by the state numerous times that it was violating state law by using the term “University” without a charter, and because it lacked a license to offer student instruction or training in New York.
Students paid as much as $35,000 each to participate in the program, which advertised that the lecturers were “Donald Trump’s handpicked experts,” and that it could “turn anyone into a successful real estate investor, including you.”
However, the complaint clams that only one person who spoke at Trump University presentations had ever even met the real estate mogul.
The case, originally filed in Aug. 2013, received renewed interest this year when a four-judge state appeals court panel found that a lower court had incorrectly dismissed the fraud complaint in 2014.
Back in June, newly unsealed testimony from the lawsuit indicated employees at the real estate training program were more focused on upselling students on additional seminars than they were on providing a bona fide education.
According to this former manager, the school’s speakers, instructors, and mentors lacked any experience in the real estate market. Instead of providing students with instruction they were promised, a former events manager who worked for the school in 2007 testified that “Trump University personnel only provided enough information to get students to sign up for the next seminar or program.”
Trump agrees to settle fraud case for $25 million: source [Reuters]
by Ashlee Kieler via Consumerist
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