7 ms·

Trump University Settles Fraud Claims for $25M

65 points by spuiszis 10y ago

kafkaesq 10y ago
“Donald Trump fought us every step of the way, filing baseless charges and fruitless appeals and refusing to settle for even modest amounts of compensation for the victims of his phony university,” Schneiderman said in a statement. “Today, that all changes. Today’s $25 million settlement agreement is a stunning reversal by Donald Trump and a major victory for the over 6,000 victims of his fraudulent university.” That's not even 5k a head. A pittance, really.
- deleted 10y ago
  [deleted]
- spuiszis 10y ago
  It probably won't even end up costing them the headline amount. Much of the settlement will likely be tax deductible similar to other government deals [1][2]. [1] http://www.forbes.com/sites/robertwood/2016/01/19/goldman-sachs-historic-5-billion-settlement-has-silver-lining-tax-deduction/#45d41fac37be http://www.forbes.com/sites/robertwood/2016/01/19/goldman-sa... [2] http://www.newsweek.com/2014/11/07/giant-penalties-are-giant-tax-write-offs-wall-street-279993.html http://www.newsweek.com/2014/11/07/giant-penalties-are-giant...
- joshmn 10y ago
  Everything seems like a win to Donald Trump. Great (?) watch http://www.pbs.org/wgbh/frontline/film/the-choice-2016/ http://www.pbs.org/wgbh/frontline/film/the-choice-2016/
- bathory 10y ago
  "Trump, 70, was accused of conning thousands of students, [...], into paying as much as $35,000 [...]" Any idea how much money a student on average lost? If that number is close to the 35k, receiving a little less than 5k is an utter travesty.
- chrsstrm 10y ago
  You forgot to take the attorney's fees off the top first. Even at the low end of the scale ~30%, that brings the individual payouts to less than $3K.
  - icebraining 10y ago
    "Lawyers for the students agreed to forgo legal fees as part of the settlement."
    - chrsstrm 10y ago
      You're right. That detail was left out of another article I read about the case, which must have been what I used as my source. It seems strange that attorneys would waive fees in a suit against a billionaire that has dragged out for nearly 4 years now. That's a lot of goodwill.
spuiszis 10y ago
I can only wonder what effect this would have on voters if it settled prior the the election.
- chrisbennet 10y ago
  Judging from other disclosures (p__sy grabbing, etc.)nothing was going to stop voters for voting for him.
  - ursus_bonum 10y ago
    At least it makes a good slogan. "Get you p__sy grabbed at Trump University!" Someone make a shirt pls.
- madaxe_again 10y ago
  None. Had it he would have. He didn't because had he lost he'd be fighting on - but as president elect he has to clean house, so expect to see many if not all suits against him and his entities settled imminently. It'll make him look generous, gracious, glorious, statesmanlike and all that jazz, and will probably buy a number of new supporters. No, now is the time that maximal political capital can be yielded - turn those liabilities into assets before they become toxic. I bet the total cost per "PR point" is less than a conventional advertising/PR campaign. He's going to be wildly popular - I wouldn't be surprised if his second term sees an 80% majority. Read that however you will.
  - runamok 10y ago
    That is quite a claim. Not sure if you mean popular or electoral but that does not seem to be the trend and it would pretty much have to be electoral. Last time someone won by 80% was Bush #1 in 1988. https://en.wikipedia.org/wiki/List_of_United_States_presidential_elections_by_popular_vote_margin https://en.wikipedia.org/wiki/List_of_United_States_presiden...
    - madaxe_again 10y ago
afinlayson 10y ago
I wonder if Donald Trump of 2012 would let a President Elect who was found to have conned thousands without making a big deal of it. "Worst abuse of power ever" or something like that.
- sintaxi 10y ago
  The thing with a settlement. He now wont be found to have conned thousands.
throwaway274739 10y ago
Not even 2 weeks ago the DRUMPF'lets were screaming bloody murder over some emails. And now that DRUMPF essentially pleads guilty to fraud on a mass scale, deafening silence. The hypocrisy is stunning.
superplussed 10y ago
Weren't the defendants in a position of greater leverage once he was elected president? From what I'd read, it would have been the first time a sitting president was forced to defend himself in a criminal trial. So if you've endured this legal battle for so long, why settle for a relatively small amount just when your leverage has started to climb?
- rayiner 10y ago
  No, he had less leverage. Ongoing lawsuits are embarrassing. Being deposed as the sitting President is really embarrassing. Settling the case was the smart thing.
  - harryh 10y ago
    Pretty sure that OP was wondering why the plaintiffs agreed to settle, not the other way around.
    - superplussed 10y ago
      Of course that was my point.
- the_why_of_y 10y ago
  A few years ago Silvio Berlusconi used his position as prime minister of Italy to get laws enacted that granted his person immunity in various ongoing bribery and corruption cases, which then had to be dropped.
cmdrfred 10y ago
If you are curious like I was why this wasn't a bigger issue during the election, turns out the other candidate wasn't in a position to take the moral high ground on this either. http://www.politico.com/story/2016/08/bill-clinton-laureate-for-profit-college-pay-226971 http://www.politico.com/story/2016/08/bill-clinton-laureate-...
- tzs 10y ago
  One big difference is that Laureate's schools are generally legitimate, with proper accreditation and whose degrees actually have some value. Generally about the worst you can say for most of the programs and schools is that you may have been able to get a better deal financial at a non-profit school. Trump University, on the other hand, was pretty much a straight up rip off.

65 points by spuiszis 10y ago

“Donald Trump fought us every step of the way, filing baseless charges and fruitless appeals and refusing to settle for even modest amounts of compensation for the victims of his phony university,” Schneiderman said in a statement. “Today, that all changes. Today’s $25 million settlement agreement is a stunning reversal by Donald Trump and a major victory for the over 6,000 victims of his fraudulent university.” That's not even 5k a head. A pittance, really.

deleted 10y ago
[deleted]
spuiszis 10y ago
It probably won't even end up costing them the headline amount. Much of the settlement will likely be tax deductible similar to other government deals [1][2]. [1] http://www.forbes.com/sites/robertwood/2016/01/19/goldman-sachs-historic-5-billion-settlement-has-silver-lining-tax-deduction/#45d41fac37be http://www.forbes.com/sites/robertwood/2016/01/19/goldman-sa... [2] http://www.newsweek.com/2014/11/07/giant-penalties-are-giant-tax-write-offs-wall-street-279993.html http://www.newsweek.com/2014/11/07/giant-penalties-are-giant...
joshmn 10y ago
Everything seems like a win to Donald Trump. Great (?) watch http://www.pbs.org/wgbh/frontline/film/the-choice-2016/ http://www.pbs.org/wgbh/frontline/film/the-choice-2016/
bathory 10y ago
"Trump, 70, was accused of conning thousands of students, [...], into paying as much as $35,000 [...]" Any idea how much money a student on average lost? If that number is close to the 35k, receiving a little less than 5k is an utter travesty.
chrsstrm 10y ago
You forgot to take the attorney's fees off the top first. Even at the low end of the scale ~30%, that brings the individual payouts to less than $3K.
- icebraining 10y ago
  "Lawyers for the students agreed to forgo legal fees as part of the settlement."
  - chrsstrm 10y ago
    You're right. That detail was left out of another article I read about the case, which must have been what I used as my source. It seems strange that attorneys would waive fees in a suit against a billionaire that has dragged out for nearly 4 years now. That's a lot of goodwill.

spuiszis 10y ago

I can only wonder what effect this would have on voters if it settled prior the the election.

chrisbennet 10y ago
Judging from other disclosures (p__sy grabbing, etc.)nothing was going to stop voters for voting for him.
- ursus_bonum 10y ago
  At least it makes a good slogan. "Get you p__sy grabbed at Trump University!" Someone make a shirt pls.
madaxe_again 10y ago
None. Had it he would have. He didn't because had he lost he'd be fighting on - but as president elect he has to clean house, so expect to see many if not all suits against him and his entities settled imminently. It'll make him look generous, gracious, glorious, statesmanlike and all that jazz, and will probably buy a number of new supporters. No, now is the time that maximal political capital can be yielded - turn those liabilities into assets before they become toxic. I bet the total cost per "PR point" is less than a conventional advertising/PR campaign. He's going to be wildly popular - I wouldn't be surprised if his second term sees an 80% majority. Read that however you will.
- runamok 10y ago
  That is quite a claim. Not sure if you mean popular or electoral but that does not seem to be the trend and it would pretty much have to be electoral. Last time someone won by 80% was Bush #1 in 1988. https://en.wikipedia.org/wiki/List_of_United_States_presidential_elections_by_popular_vote_margin https://en.wikipedia.org/wiki/List_of_United_States_presiden...
  - madaxe_again 10y ago

afinlayson 10y ago

I wonder if Donald Trump of 2012 would let a President Elect who was found to have conned thousands without making a big deal of it. "Worst abuse of power ever" or something like that.

sintaxi 10y ago
The thing with a settlement. He now wont be found to have conned thousands.

throwaway274739 10y ago

Not even 2 weeks ago the DRUMPF'lets were screaming bloody murder over some emails. And now that DRUMPF essentially pleads guilty to fraud on a mass scale, deafening silence. The hypocrisy is stunning.

superplussed 10y ago

Weren't the defendants in a position of greater leverage once he was elected president? From what I'd read, it would have been the first time a sitting president was forced to defend himself in a criminal trial. So if you've endured this legal battle for so long, why settle for a relatively small amount just when your leverage has started to climb?

rayiner 10y ago
No, he had less leverage. Ongoing lawsuits are embarrassing. Being deposed as the sitting President is really embarrassing. Settling the case was the smart thing.
- harryh 10y ago
  Pretty sure that OP was wondering why the plaintiffs agreed to settle, not the other way around.
  - superplussed 10y ago
    Of course that was my point.
the_why_of_y 10y ago
A few years ago Silvio Berlusconi used his position as prime minister of Italy to get laws enacted that granted his person immunity in various ongoing bribery and corruption cases, which then had to be dropped.

cmdrfred 10y ago

If you are curious like I was why this wasn't a bigger issue during the election, turns out the other candidate wasn't in a position to take the moral high ground on this either. http://www.politico.com/story/2016/08/bill-clinton-laureate-for-profit-college-pay-226971 http://www.politico.com/story/2016/08/bill-clinton-laureate-...

tzs 10y ago
One big difference is that Laureate's schools are generally legitimate, with proper accreditation and whose degrees actually have some value. Generally about the worst you can say for most of the programs and schools is that you may have been able to get a better deal financial at a non-profit school. Trump University, on the other hand, was pretty much a straight up rip off.