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Monday, August 21, 2017

Reposted with permission from Media Matters for America.

Following the release of unsealed court documents related to the ongoing lawsuits against presumptive Republican presidential nominee Donald Trump’s now-defunct “Trump University” business, media are beginning to highlight the contradictory and false statements Trump has made about Trump U. on the campaign trail. But Trump and his real estate seminar business have been facing these fraud and misrepresentation lawsuits for years, and Fox News was letting Trump lie about it long before he became a presidential candidate.

In August 2013, Trump joined Fox & Friends for a nearly eight-minute phone interview to discuss the filing of a civil suit against Trump U. by New York Attorney General Eric Schneiderman, which alleged his business violated the law through an “elaborate bait-and-switch” scheme. The Fox hosts allowed Trump to repeatedly misrepresent his defunct real estate seminar business and float baseless conspiracy theories about the origins of the lawsuit, and even agreed with Trump that the suit could be a politically motivated attack.

Here are the lies Fox News allowed Trump to push about Trump U. years before its allegedly fraudulent practices became presidential election news.

 

 

Trump Claim: Trump U. Had A “98 Percent Approval Rating”

Trump Repeatedly Touted A “98 Percent Approval Rating” In His Fox Interview. In the course of the phone interview, Trump referred to Trump University’s “98 percent approval rating” or “high rating,” at least five times. From the August 26, 2013, phone interview:

DONALD TRUMP: You know, we have a school. The school is really a good school. They did a terrific job. We had wonderful instructors, wonderful everything. …I really think that, you know, we have a great school. This school is a great school. They’ve done a fantastic job. When you get 98 percent approval ratings from the people that took the courses, and then you get sued, it’s rather shocking. [Fox News Channel, Fox & Friends, 8/26/13]

Fact: Trump U. Approval Rating Statement Is “Misleading”

FactCheck.org: Lawsuit Alleges “Surveys Were Filled Out Under Pressure.” When Trump repeated his claim that Trump University had a “98 percent approval rating” in a presidential debate, FactCheck.org concluded that the statement was “misleading,” and pointed to evidence from one of the lawsuits Trump U. faces, which alleges students who filled out positive surveys may have been misled by instructors or encouraged to submit positive ratings under pressure:

In addition, Trump’s claim that “we have a 98 percent approval rating from the people who took the course” is misleading.

While it may be the case that many attendees initially filled out positive evaluations, one of the class-action lawsuits alleges that the surveys were filled out under pressure or with the expectation that participants would receive additional benefits in the future.

Tarla Makaeff v. Trump University, complaint, Sept. 26, 2012: While Trump University’s website has publicly claimed that 95% to 98% of students are satisfied with its course, this figure is far from the truth. While it may be true that Trump University received some positive ratings in surveys given to the students while the Seminars were in session or immediately afterward, at this point, many of the students actually still believe that they will eventually get the information and mentoring they need, since they have been promised a one-year apprenticeship or one-year mentorship. Also, these surveys are not anonymous, but have the students’ names on them, and students are often reluctant to criticize the instructors and mentors who they have paid a lot of money to help them throughout the year. It is not until later, when students see that the help and information they need is never coming — that they realize they have been scammed.

For example, Kevin Scott, who paid more than $30,000 for the courses, said that he gave his instructor a positive review “because I did not think that the problems with the mentorship were his fault.” And Robert Guillo, who also paid more than $30,000 on the program, said that he gave his instructor a positive assessment “because I believed that that was the only way to get my Certificates of Completion for the seminars that I attended.” [FactCheck.org, 3/4/16]

NYT Investigation: “The Surveys Themselves Were A Central Component Of A Business Model That … Deceived Consumers.” A March investigation from The New York Times reported legal testimony and in-depth interviews from several former Trump U. students who detailed ways in which they were misled or pressured into giving positive reviews to Trump’s real estate program (emphasis added):

Robert Guillo gave a glowing evaluation to his instructor at Trump University because, he said, the teacher pleaded for the best possible score, warning that without it, “Mr. Trump might not invite me back to teach again.”

Jeffrey Tufenkian offered excellent ratings because his Trump University-assigned mentor refused to leave the room until he did so, standing “right in front of me” as he filled out the evaluation form, he said.

John Brown tried to give his Trump University teacher a poor review — but said he was talked out of it by employees of the program, who called him three times, hounding him to raise his original scores.

“Tired of the continuing phone calls,” he later testified, “I finally gave in.” His dismal marks changed to top scores, Mr. Brown said.

[…]

Now, as Mr. Trump tries to fend off claims of misleading and fraudulent practices from scores of former students, claims his opponents have brought up in debates and in ads, his biggest weapon is what appears to be the overwhelmingly positive reviews from past participants — a 98 percent level of satisfaction, in his telling. “Beautiful statements,” is how he describes the evaluations.

But hundreds of pages of legal documents, as well as interviews with former students and instructors, suggest the surveys themselves were a central component of a business model that, according to lawsuits and investigators, deceived consumers into handing over thousands of dollars with tantalizing promises of riches. [The New York Times, 3/11/16]

Trump Claim: “I See Instructors, I Talk To Instructors, I Talk To People.”

When Asked If “Trump ‘Elite’ Program” Students At Trump U. Met With Trump, Trump Underscored His Personal Involvement With Instructors. During the phone interview, co-host Brian Kilmeade asked Trump about one of the allegations in the New York civil suit related to a Trump University “promise” of “one-on-one time” with Trump himself for certain students. Trump did not address Kilmeade’s question directly, but did claim that he had been “very much involved” in meeting with and hiring Trump U. instructors. From the August 26, 2013, phone interview:

BRIAN KILMEADE (co-host): Now, one thing specifically that they write is that the Trump “elite” program, which cost between 10 and 35 thousand dollars, promises one-on-one time with you. Number one, is the promise valid? And number two, did you spend one-on-one time with people that go into the elite program?

DONALD TRUMP: Well look, I was very much involved with the school from the standpoint of, I see instructors, I talk to instructors. I talk to people, I worked very hard with the people that run the school to make sure it’s good. I check resumes. It was very important to me. [Fox News Channel, Fox & Friends, 8/26/13]

Fact: Trump Has Repeatedly Lied About Whether Or Not He Had Personal Contact With Instructors And Students

In Court Trump Could Not Recognize A List Of Instructors, Testimony Revealed He Had Not Helped Choose Them. In a December deposition in one of two California class-action lawsuits making similar allegations as the New York suit, Trump testified under oath that he could not recognize the names of any instructors on a provided list. Trump also stated that he had not, in fact, been involved in “hand-picking” instructors for the seminars. A CNN investigation of these court documents concluded that Trump “had nothing to do with the selection process of instructors” and that no one “at the Trump Organization was involved in the curriculum for the three-day real estate workshops”:

In Trump’s own deposition this past December, Trump failed to recognize the name of a single presenter or teacher at his real estate seminars. He also confirmed he had nothing to do with the selection process of instructors who taught at the school’s events or mentors for the school’s “Gold Elite” programs.

A review of Trump University presenters and so-called real estate experts found many with questionable credentials and inflated resumes. Court documents show background-checks conducted during the hiring process could not determine whether some instructors even graduated high school.

[…]

In a recently released deposition taken on July 25, 2012, [Trump University official] Sexton, stated under oath: “None of our instructors at the live events were handpicked by Donald Trump.”

Asked by attorneys if anyone at the Trump Organization was involved in the curriculum for the three-day real estate workshops, Sexton answered, “No.”

Sexton confirmed Trump’s lack of involvement in producing or reviewing the material used in the workshops. And on the specific promise of teaching Donald Trump’s “proven secrets” in real estate, Sexton testified that the course taught strategies on how to invest in foreclosures, which Trump has used in the past.

“Mr. Trump has made investments with foreclosures. We cover investing with foreclosures,” Sexton said.

Sexton testified Trump did have direct involvement in one part of the program — advertising.

“He personally approved all the ads that were in newspapers,” Sexton testified. [CNN,5/27/16]

New York Attorney General: Trump “Did Not Handpick Even A Single Instructor At These Seminars.” In the official press release announcing the filing of the New York civil suit, the office of the New York attorney general wrote (emphasis added):

The petition filed in New York Supreme Court in Manhattan by Attorney General Schneiderman details the advertisements run by Trump University in major newspapers across the country and the direct mail solicitations sent to entice consumers to attend a free workshop. These ads prominently displayed Donald Trump’s photograph and signature, or were styled as letters written by Trump himself. The advertisements were replete with false claims, including claims that consumers would learn “from Donald Trump’s handpicked instructor a systematic method for investing in real estate that anyone can use.” Other ads promised “my handpicked instructors will share my techniques” or “learn from my hand-picked expert” and “just copy exactly what I’ve done and get rich.”

An investigation by Attorney General Schneiderman revealed that Donald Trump did not handpick even a single instructor at these seminars and had little or no role in developing any of the Trump University curricula, or seminar content. The investigation also revealed that officials used the name “Trump University” even though they lacked the charter necessary under New York law to call themselves a University. They were also unlicensed under New York State Education Law, evading an array of legal protections designed to protect New Yorkers from fraud. [New York State Office of the Attorney General,8/25/13]

New Testimony From Former Employee: Trump Involvement Was “Not True.” In recently released testimony from former Trump U employees , one employee refuted claims that Trump was “actively involved” in the real estate seminars. From The New York Times report on the testimony:

Jason Nicholas, a sales executive at Trump University, recalled a deceptive pitch used to lure students — that Mr. Trump would be “actively involved” in their education. “This was not true,” Mr. Nicholas testified, saying Mr. Trump was hardly involved at all. Trump University, Mr. Nicholas concluded, was “a facade, a total lie.” [The New York Times, 6/1/16]

Trump Claim: Trump Repeatedly Called His Real Estate Seminar Business A “School” And Compared It To Harvard Or Wharton

During Fox & Friends Phoner, Trump Boasted Trump U. Had A Better Approval Rating Than Harvard Or Wharton. Throughout the nearly eight-minute phone interview on Fox & Friends, Trump repeatedly praised his real estate business as a “school” and drew a favorable comparison between Trump U and Harvard University and the University of Pennsylvania’s Wharton School of Finance. From the August 26, 2013, phone interview:

STEVE DOOCY (co-host): I’ll tell you what, Mr. Trump, I’ve got two kids in college right now and neither one of those colleges guarantee that the kids are going to have jobs when they get out.

DONALD TRUMP: Well, that’s the other thing. I mean, you could go to Harvard and you could go to the Wharton School of Finance, I guarantee you they don’t have a 98 percent approval rating.

BRIAN KILMEADE (co-host): Right.

TRUMP: That’s one thing I can tell you for sure. [Fox News Channel, Fox & Friends, 8/26/13]

Fact: Unlicensed Trump U Was Legally Required To Change Its Name Because The Term “University” Was Misleading

Trump University Was Never Licensed As A School. The Washington Post outlined the many ways Trump University attempted to cast itself as an educational institution, although it was never licensed as a school. The article also quoted a Trump lawyer who denied the real estate business was meant to seem like a school. From the September 13 article:

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.

[…]

It is unbelievable, [Trump Organization general counsel Alan] Garten said, that anyone could have thought that Trump University was a university in the traditional sense. Classes were held in hotel ballrooms, after all. “People who say, ‘I thought it was a university with a football team and a bookstore,’ it’s laughable,” he said. [The Washington Post, 9/13/15]

FactCheck.org: Trump U, Which Was “Never Officially Licensed” As A University, “Eventually Had To Change Its Name.” In a March fact-check of several of Trump’s claims related to Trump U, FactCheck.org noted that the real estate seminar business was never licensed as a university and “eventually had to change its name” in 2010:

Trump and his “university,” which was never officially licensed as such and eventually had to change its name to The Trump Entrepreneur Initiative in May 2010, are the subjects of three ongoing lawsuits alleging fraud. [FactCheck.org, 3/1/16]

In New York And Maryland, Trump U Was Legally Barred From Advertising As A University. In a report detailing Attorney General Schneiderman’s initial investigation into alleged fraudulent practices at Trump U, The New York Times noted that the real estate business was barred from calling itself a “university” in the states of New York and Maryland, and that doing so was considered a “violat[ion of] state education laws.” From the 2011 article:

But, as The New York Times reported last week, dozens of students have complained about the quality of the program to the attorneys general of New York, Texas, Florida and Illinois. The Better Business Bureau gave the school a D-minus for 2010, its second-lowest grade, after receiving 23 complaints. Over the last three years, New York and Maryland have told the company to drop the word “university” from its title, saying that using it violated state education laws. (The school was renamed the Trump Entrepreneur Initiative in 2010.) [The New York Times, 5/19/11]

 

Trump Claim: New York Attorney General Colluded With President Obama To Sue Trump “For Political Reasons”

Trump: “Lightweight” Attorney General Met With President Obama, Immediately Filed “Terribly Drawn” Lawsuit. Trump also used his phone interview with Fox & Friends to float conspiracy theories about the motivations of the attorney general leading the civil suit against Trump U. During the phoner, Trump repeatedly mentioned that “political hack” Schneiderman had met with President Obama shortly before filing the suit, and suggesting the lawsuit was a baseless attack for “publicity.”

DONALD TRUMP: Think about how many schools you have all over the place, and [Schneiderman] picks Trump. I mean, give me a break.

BRIAN KILMEADE (co-host): After golfing with President Obama, who clearly has not been fond of you.

TRUMP: Well, I’ll tell you what. Look, I’ve been a very harsh critic of the president. And I don’t want to be. If he was doing a great job, I don’t care, I’m a Republican, I would say he’s doing a great job. But he’s not doing a great job. They meet on Thursday evening, I get sued by this A.G. Schneiderman. I get sued on Saturday at one o’clock. Now think of it. What government agency in the history of this country has ever brought a suit on a Saturday? I’ve never heard of such a thing. So he meets with the president on Thursday night, he sues me on Saturday. It was a terribly drawn suit, incompetently drawn suit, and they obviously did it very quickly, but probably Obama, maybe this is a mini-IRS, maybe we have to get the Tea Party after these people, because this could very well be a mini-IRS.[Fox News Channel, Fox & Friends,8/26/13]

 

Fact: Trump U. Had Already Been Under Investigation For Years

Schneiderman Was Investigating Trump U. Long Before Encounter With Obama, Spurred By A “String Of Consumer Complaints.” Two years before Trump’s Fox & Friends interview or the filing of the New York suit, Schneiderman first launched an investigation into “credible” and “serious” allegations that the real estate seminar business had engaged in misleading business practices. At the time, The New York Times reported that the inquiry was part of a broader investigation into at least five for-profit educational companies. From the 2011 article:

The investigation was prompted by about a dozen complaints concerning the Trump school that the attorney general, Eric T. Schneiderman, has found to be “credible” and “serious,” these people said, speaking on the condition of anonymity because the investigation was not yet public.

The inquiry is part of a broader examination of the for-profit education industry by Mr. Schneiderman’s office, which is opening investigations into at least five education companies that operate or have students in the state, according to the people speaking on the condition of anonymity.

The investigation is the latest problem for a six-year-old company, known until last year as Trump University, that already faces a string of consumer complaints, reprimands from state regulators and a lawsuit from dissatisfied former students. [The New York Times, 5/19/11]

Trump U. Was Also Facing A Class-Action Lawsuit When Schneiderman Filed The Civil Suit. When Trump phoned into Fox & Friends in 2013 to characterize the New York civil suit against Trump U as a publicity scheme, he didn’t mention the real estate seminar business had been fighting allegations of fraud in a federal California court since 2010. According to a press release, the law firm representing a nationwide class action against Trump U. filed the action — which is still pending, and now represents one of three ongoing fraud lawsuits against the Trump U. business — in April of 2010, detailing the business’ “disturbing practices” that “targeted and preyed on the fears of seniors,” among other allegations:

Plaintiff and class members who attended Trump University’s real estate investing classes were promised a “complete real estate education,” a “one year apprenticeship,” a one-on-one mentorship, practical and fail-safe real estate techniques, a “power team” consisting of real estate agents, lenders, personal finance managers, property managers and contractors, and were assured that although the seminars cost as much as $35,000, they would make the money back in their first real estate deal, and could make up to tens of thousands of dollars per month or more. However, instead, each seminar was merely an “infomercial” to up-sell the student to purchase an additional Trump Seminar. The promised “one year apprenticeship” was in actual fact a 3-day seminar; the one-on-one year-long mentorship consisted of a 2-1/2 day excursion to view properties, and “mentors” recommended real estate deals in which they stood to financially benefit, and then quickly disappeared and failed to return calls. One of the most disturbing practices was telling students to raise their credit card limit 4 times, presumably to make real estate purchases, but then Trump University representatives told the students to use their newly increased credit limit — not to purchase real estate – but to purchase the next Trump “Gold” seminar – for $35,000.

Further, the Trump University targeted and preyed on the fears of seniors, asking “How many of you lost a lot of your 401k investment in the market? How many of you are retired? How many of you want to leave a legacy or property to your kids?” Such tactics were not only unconscionable but illegal. [Robbins Gellar Rudman & Dowd, LLP, 4/30/10]

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