New York Attorney General A. G. Schneiderman alleges that Donald Trump advertised that enrollees in Trump University would learn the techniques he himself used to build a fortune via investing in real estate, but then failed to deliver the goods. The result, says Schneiderman, was millions in fraudulent income for TU.
In the description of the complaint, it was charged that Trump appeared in commercials for TU, and it specifically cites newspaper and direct mail advertising. There was no specific mention of any TV or radio spots.
Schneiderman had a laundry list of complaints about the operation, and said that the total of the fraudulent income it generated is $40M.
“More than 5,000 people across the country who paid Donald Trump $40 million to teach them his hard sell tactics got a hard lesson in bait-and-switch,” said Attorney General Schneiderman. “Mr. Trump used his celebrity status and personally appeared in commercials making false promises to convince people to spend tens of thousands of dollars they couldn’t afford for lessons they never got. No one, no matter how rich or popular they are, has a right to scam hard working New Yorkers. Anyone who does should expect to be held accountable.”
Schneiderman said there were numerous misrepresentations involved in the operation, including:
* consumers would learn “everything [they] need[ed] to know” to become successful real estate investors;
* consumers would quickly recoup their investment by doing real estate deals, with some instructors claiming that consumers would earn tens of thousands of dollars within thirty days;
* instructors were “handpicked” by Donald Trump;
* consumers would be taught Donald Trump’s very own real estate strategies and techniques;
* consumers would receive access to private sources of financing (“hard money lenders”); and
* the three-day seminar would include a year-long “Apprenticeship Support” program.
There were also implied benefits that never were realized.
What was offered was a three-day seminar costing about $1.5K during which instructors tried to get them to sign up for more expensive programs.
The AG office said, “Many consumers who made the costly investments did not receive the individual mentor attention promised. After an initial three-day session, many mentors failed to return phone calls or emails and provided little to no follow-up assistance. Despite diligent efforts, many consumers were unable to conclude even a single real estate deal and were left worse off than they had been before enrolling in the Trump University programs. Some consumers faced thousands of dollars of debt due to the expensive cost of the Elite Programs. Many felt they had been victims of an elaborate scam.”
It was also charged that Trump University was operating unlicensed from 2005-2011.
The AG petition is going to theNew York Supreme Court in Manhattan.