US President-elect Donald Trump on Friday agreed to a $25 million deal to settle lawsuits accusing his now-defunct Trump University of fraud, sparing him the embarrassment of further legal wrangling as he prepares to enter the White House.
A trio of suits brought by former students alleged that the training programme — which was not an accredited college or university, but was in operation from 2005 to 2011 — fleeced students by tricking them with aggressive marketing.
Students paid as much as $35,000 to enroll, wrongly believing they would make it big in real estate after being taught by the Manhattan billionaire property mogul’s hand-picked experts, said the suits brought in New York and California.
Trump’s lawyers had countered for years that many students had given the program a thumbs-up and those who failed to succeed had only themselves to blame.
But, with the president-elect apparently seeking to put the thorny matter to rest as he builds his cabinet, a deal was reached.
“Today’s $25 million settlement agreement is a stunning reversal by Donald Trump and a major victory for the over 6,000 victims of his fraudulent university,” New York state attorney general Eric Schneiderman said.
“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.”
A spokesperson for Schneiderman’s office said the settlement covers all three class-action lawsuits against Trump University: two in California and one in New York.
Robert Guillo, a 76-year-old New Yorker who spent nearly $40,000 on tuition alongside his son, told AFP a few months ago that the program was an “absolute scam.”
“I learned absolutely nothing,” Guillo told AFP by telephone. “He fooled me for $35,000.”
The agreement came just an hour before a hearing in a San Diego federal court was about to begin to decide on a request by Trump to delay the trial.
A Trump Organization spokesman confirmed the settlement, even though he insisted they would have won had the case run its course.
“While we have no doubt that Trump University would have prevailed at trial based on the merits of this case, resolution of these matters allows President-elect Trump to devote his full attention to the important issues facing our great nation,” the spokesman said in a statement read on CNN.
In February, Trump tweeted that the program had a 98 percent approval rating and said he did not want to settle out of principle.
Trump also attacked the US-born federal judge handling the case in San Diego, Gonzalo Curiel, saying he could not be impartial because of his Mexican roots — comments that outraged many.
During the bitter presidential campaign, Trump had pledged to build a wall on the border with Mexico and expelling millions of illegal immigrants — comments which the president-elect said had turned the judge against him.
Trump’s also had to fend off attacks from his rivals in the Republican primaries about Trump University, but neither the barbs nor the actual legal cases dented his run all the way to the White House.