Donald Trump introduces Trump University at a press conference in Trump Tower, New York, May 2005.
Photo by Dan Herrick/KPA/ZUMA

After vowing to do the opposite, Trump settles fraud case

One week from today, President-elect Donald Trump was scheduled to take the stand in a fraud case surrounding his scandal-plagued “Trump University,” which has been accused of ripping off students and making ridiculous claims about the value of its lessons. The Republican was poised to be the first president-elect to ever give sworn testimony in his own fraud case.

As it turns out, Trump won’t have to take the stand after all. As Politico reported, the controversial businessman who vowed not to settle this case ended up settling this case.
President-elect Donald Trump, who once declared “I don’t settle lawsuits,” took to Twitter Saturday to justify his decision to pay $25 million to settle fraud lawsuits over his now-defunct Trump University real estate seminar program. He also hinted that had he not been so busy preparing to take office, he might not have settled.

“The ONLY bad thing about winning the Presidency is that I did not have the time to go through a long but winning trial on Trump U. Too bad!,” Trump tweeted.
The settlement resolves a class-action case and an investigation launched by New York Attorney General Eric Schneiderman.

Note, as recently as March, Trump boasted during a GOP debate, “This is a case I could have settled very easily, but I don’t settle cases very easily when I’m right.” After boasting that the Better Business Bureau gave Trump University an “A” rating – a claim that turned out to be a brazen lie – Trump added, “Again, I don’t settle cases. I don’t do it because that’s why I don’t get sued very often, because I don’t settle, unlike a lot of other people.”

The assertion that doesn’t “get sued very often” also turned out to be a demonstrable falsehood, as was the boast about never settling.

To the extent that reality still matters, it’s worth remembering that the case against Trump was quite strong. The Washington Post reported in September that the New York Republican was the namesake of a “university,” where students sometimes “max[ed] out their credit cards to pay tens of thousands of dollars for insider knowledge they believed could make them wealthy.”
Never licensed as a school, Trump University was in reality a series of real estate workshops in hotel ballrooms around the country, not unlike many other for-profit self-help or motivational seminars. Though short-lived, it remains a thorn in Trump’s side nearly five years after its operations ceased: In three pending lawsuits, including one in which the New York attorney general is seeking $40 million in restitution, former students allege that the enterprise bilked them out of their money with misleading advertisements.

Instead of a fast route to easy money, these Trump University students say they found generic seminars led by salesmen who pressured them to invest more cash in additional courses. The students say they didn’t learn Trump’s secrets and never received the one-on-one guidance they expected.
“He’s earned more in a day than most people do in a lifetime,” a 2009 ad, featuring Trump’s photograph, said. “He’s living a life many men and women only dream about. And now he’s ready to share – with Americans like you – the Trump process for investing in today’s once-in-a-lifetime real estate market.”

As regular readers may recall, Trump’s attorneys insisted that aspiring investors learned valuable lessons with which most students were satisfied. But the Post’s article also highlighted a Texas man, Louie Liu, who said he paid “$1,495 for a three-day seminar, then felt lured into paying $24,995 for more classes, an online training program and a three-day in-person mentorship.”

He now believes that the Trump University program was a “scam.”

Another man, Bob Guillo, paid nearly $35,000 for the “Trump Gold Elite package,” which amounted to very little. “I really felt stupid that I was scammed by Trump,” Guillo said.

Indeed, the campaign parallels are hard to miss: a group of Americans, looking for easy solutions and wowed by a celebrity making too-good-to-be-true promises, put their faith in an accused scam artist, only to learn that Donald Trump had no intention of delivering on outlandish pledges that never really made any sense.

Rank-and-file voters, however, do not have the option of filing a class-action lawsuit.

Postscript: Take a moment to consider the political world’s reaction if Barack Obama or Hillary Clinton faced credible allegations of defrauding members of the public, and then quietly settled the case – late on a Friday – writing a big check to make the accusations go away.

How many congressional hearings would there be? How many calls for a special prosecutor would we hear?

Post-Postscript: This is the same controversy in which Trump faced allegations of bribery when Florida Attorney General Pam Bondi (R) dropped a probe into “Trump University” after the Trump Foundation made an illegal campaign contribution to the Florida Republican. Bondi is now a member of Trump’s transition team.



Donald Trump and Scandals

After vowing to do the opposite, Trump settles fraud case