November 18, 2016
ALBANY — In a complete turnaround from his previous position, President-elect Donald Trump is nearing a settlement of the fraud cases brought in New York and California involving his now defunct for-profit Trump University, the Daily News has learned.
November 18, 2016
ALBANY — In a complete turnaround from his previous position, President-elect Donald Trump is nearing a settlement of the fraud cases brought in New York and California involving his now defunct for-profit Trump University, the Daily News has learned.
In this May 23, 2005 file photo, real estate mogul and reality TV star Donald Trump, left, listens as Michael Sexton introduces him at a news conference in New York where he announced the establishment of Trump University.
Under the emerging deal being negotiated by Trump's lawyers, New York State Attorney General Eric Schneiderman and the law firm that brought a class action lawsuit regarding Trump University in California, the president-elect will agree to pay between $20 million and $25 million to settle the matter, a source with knowledge of the situation said.
Trump will not admit to any wrongdoing in the final agreement, which could be announced as soon as Friday, the source said.
During the presidential campaign, Trump had threatened to have his executives reopen the school once the cases were done. It's not clear if that was bluster or if the settlement will bar that from happening even if he was serious.
The settlement comes just days before a class action lawsuit in California was set to begin. With the trial date approaching – and Trump getting ready to take office – the judge in the case pushed for aggressive settlement talks among all the parties, the source said.
Before being elected President earlier this month Trump had publicly vowed not to settle the matter.
"It's a complete 180 (degree turn) by Trump," the source said.
Privately there had been some settlement talks before Election Day, though Trump wasn't willing to pay anything higher than in the low seven-figure range, the source said.
Schneiderman spokesman Eric Soufer wouldn't comment on the specifics, but said "as Attorney General Schneiderman has long said, he has always been open to a settlement that fairly compensates the many victims of Trump University who have been waiting years for a resolution." A lawyer for Trump could not be reached for comment.
During the presidential campaign, Trump had threatened to have his executives reopen the school once the cases were done. – Mario Tama/Getty Images
Schneiderman in 2013 brought a fraud lawsuit against Trump University claiming that the school was nothing but a scam designed to make money for Trump by falsely promising wannabe real estate developers they would learn the tricks of the trade from Trump and his hand-picked teachers.
Kevin Allred (pictured) said he was released from the hospital after only two hours because there is nothing wrong with him — and doctors at Bellevue Hospital agreed. – Chris Detrick/The Salt Lake Tribune via AP
Instead, those who enrolled were pressured to take more expensive programs from people not selected by Trump. The closest they got to Trump himself was when they were able to take a picture with a cardboard cutout of him, Schneiderman alleged.
Schneiderman initially sought $40 million from Trump, saying he swindled more than 5,000 students through the school. The final $20 million to $25 million settlement will cover students from both the New York and California cases, though there had been some overlap, the source said.
In the end, about 800 people from the New York case who enrolled in Trump University and who have been waiting for compensation since 2012 will now receive it, the source said.
Schneiderman has slammed Trump University, which closed in 2010, as a "fraud from beginning to end" and has suggested that "the initial estimates are that (Trump) personally pocketed $5 million from" his school.
"Using false promises to prey on desperate people has long been a hallmark of 'snake-oil salesmen,’" Schneiderman said this past July. "A lawsuit by my office alleges that Donald Trump was basically doing the same thing with Trump University."
Trump has denied the allegations of fraud, saying 98% of the people who signed up for the programs expressed satisfaction, and blistered Schneiderman as a "lightweight."
Courtesy: NY Daily News
