Fraud Case Against Trump University Moves Forward

The New York Attorney General's fraud lawsuit against Donald Trump's now defunct investment "university" can proceed, according to a state appeals court. The suit, originally filed in 2013 and included below, alleges Trump University used "deceptive and unlawful practices" to fleece prospective students of some $40 million.

The New York Supreme Court has already ruled that Trump University violated state law by operating an unlicensed educational institution. Now a jury will decide whether Trump and other school operators fraudulently induced residents to buy increasingly expensive seminars to be "the next DONALD TRUMP."

Taken to School

The lawsuit claims Trump University used a nationwide marketing campaign to "lure prospective students to a free 90-minute seminar" to learn "Donald Trump's techniques for investing in real estate." The free seminar, akin to those hawking timeshares, was merely a sales pitch for ever more expensive courses, including the "Trump Elite" package costing up to $35,000.

According to the suit, some 5,000 people across the country were duped into paying for Trump University courses, which failed to feature real estate experts allegedly handpicked by Trump himself and more often than not left students "worse off financially than they had been before."

Statute of Limitations

Although Trump's attorneys had tried to get the fraud case dismissed based on New York's statute of limitations laws, but the 4-judge panel of the state Appellate Division disagreed, and ruled that the attorney general's office was "authorized to bring a cause of action for fraud."

Trump University became campaign fodder in last weekend's Republican primary debate, with presidential nominee hopeful Marco Rubio attacking the failed "Entrepreneur Initiative": "There are people who borrowed $36,000 to go to Trump University, and they're suing now. And you know what they got? They got to take a picture with a cardboard cutout of Donald Trump."

New York Attorney General Eric Schneiderman, never one to shy away from a high-profile case, called the ruling a "clear victory," and vowed to prove that "Donald Trump and his sham for-profit college defrauded more than 5,000 consumers out of millions of dollars." You can read the entire lawsuit below.

The State of New York v. Trump University, Complaint by FindLaw