Business tycoon Donald Trump is being sued for $40 million by the New York attorney general for his fake “Trump University.” Trump argued that the lawsuit is false and politically motivated.
Attorney General Eric Schneiderman argues that Trump University deceived consumers into attending expensive seminars with the expectation of replicating Trump’s success. Of the 5,000 students, some paid up to $35,000. Many were unable to obtain a real estate job after attending Trump University and now have thousands of dollars of debt. Trump’s lawyers argue that the investigation is attempting to seize campaign contributions from Trump and that Trump University never deceived anyone.
The case will be heard in the state Supreme Court in Manhattan. Schneiderman is suing Trump as the university chairman for engaging in persistent fraud, illegal and deceptive conduct, and violating federal consumer protection law. He is seeking $40 million, most of which will be paid in restitution for Trump University students. Schneiderman’s lawsuit covers a period between 2005 and 2011.
AP quoted Schneiderman, “Trump University engaged in deception at every stage of consumers’ advancement through costly programs and caused real financial harm.” He went on, “Trump University, with Donald Trump’s knowledge and participation, relied on Trump’s name recognition and celebrity status to take advantage of consumers who believed in the Trump brand.”
Trump’s lawyers argue that the university never deceived anyone. Attorney Michael D. Cohen told the Associated Press on Sunday, August 26, 2013 that Trump University gave Schneiderman almost 11,000 testimonials from pleased students and said that 98% of students surveyed said the program was “excellent.”
The AP quoted Cohen, “The attorney general has been very angry because he felt that Mr Trump and his various companies should have done much more for him in terms of fundraising.”
According to State of Board Election records, Trump contributed $12,500 in October of 2010 when Schneiderman was running for attorney general. Cohen said, “This entire investigation is politically motivated and it is a tremendous waste of taxpayers’ money.”
This is not the first time that Trump University has faced a lawsuit. Trump changed the name of his institution to the Trump Entrepreneur Institute in 2011 after the Stated Education Department told him that his institute did not have a license and did not meet the legal requirements of a university. Trump has faced a couple of civil lawsuits arguing that it did not fulfill its advertised claims.