Donald Trump Sued Over 'Phony' University
Donald Trump is being sued by New York's attorney general for $40m (£26m) for his role as chairman of an allegedly fraudulent "Trump University" which promised to make students rich but ended up costing them a fortune.
The American property mogul said Democrat Eric Schneiderman's lawsuit was false and politically motivated.
Mr Schneiderman said many of the 5,000 students who each paid up to $35,000 (£23,000) for masterclasses thought they would at least meet Mr Trump, but instead all they got was their picture taken in front of a life-size picture of The Apprentice star.
"Trump University engaged in deception at every stage of consumers' advancement through costly programmes and caused real financial harm," he said.
"Trump University, with Donald Trump's knowledge and participation, relied on Trump's name recognition and celebrity status to take advantage of consumers who believed in the Trump brand."
The lawsuit says many of the wannabe property tycoons were unable to land even one real estate deal after leaving the university.
State Education Department officials told Mr Trump to change the name of his university years ago, saying it lacked a licence and did not meet the legal definitions of a university.
In 2011, it was renamed the Trump Entrepreneur Institute, but it has been dogged since by complaints from budding dealers who said it did not fulfil its advertised claims.
The lawsuit covers complaints from students who paid between $1,495 and $35,000 to learn from the Manhattan tycoon between 2005 and 2011.
It says the three-day seminars did not, as promised, teach consumers everything they needed to know about real estate.
Mr Schneiderman is suing the university, and Mr Trump as its chairman, in a case to be handled in the Supreme Court in Manhattan.
He accuses them of engaging in persistent fraud, illegal and deceptive conduct and violating federal consumer protection law.
Mr Trump's lawyers said the lawsuit was filled with falsehoods, and Mr Trump and his university had never defrauded anyone.
They said Mr Schneiderman's lawsuit was a response to Mr Trump's failure to give him enough in campaign funds.