Trials & Litigation

Trump University settles fraud suits for $25M; New York AG calls deal 'a stunning reversal'

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Eric Schneiderman

New York Attorney General Eric Schneiderman. a katz /

Trump University has agreed to pay $25 million to settle lawsuits claiming its real estate investment seminars defrauded students who paid $1,500 to $35,000 for classes.

New York Attorney General announced the settlement Friday. Schneiderman called the deal “a stunning reversal by Donald Trump and a major victory for the over 6,000 victims of his fraudulent university.”

“I am pleased that under the terms of this settlement, every victim will receive restitution and that Donald Trump will pay up to $1 million in penalties to the State of New York for violating state education laws,” Schneiderman said.

Reuters was first to report the settlement in a story based on an anonymous source. The settlement resolves litigation pending in California as well as New York, the Wall Street Journal (sub. req.) and the New York Times report.

Donald Trump won’t admit any wrongdoing in the settlement, according to the Wall Street Journal.

Three suits are pending against Trump University: two California class actions and the suit by Schneiderman.

The New York suit said the unlicensed university claimed its courses were taught by handpicked instructors who would teach “get rich” techniques, even though only one of the live-event instructors had even met Donald Trump. The suit also alleged that students who attended Trump University classes were encouraged to take increasingly expensive courses in a “bait and switch” tactic.

Trump had criticized the judge who presided over the class actions as “a hater of Donald Trump.” Trump had said U.S. District Judge Gonzalo Curiel is “a very hostile judge … who happens to be, we believe, Mexican.” The judge was born in Indiana.

Related articles: “Suit alleging fraud by Trump University isn’t time-barred, New York appeals court rules” “Judge allows suit against Trump University, sides with Trump on another issue” “Trump suggests possibility of civil case against federal judge; what about a recusal motion?”

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