Trump's legal troubles with alleged Trump U. fraud a growing issue on the campaign
Donald Trump is facing two lawsuits from students who allege fraud in connection with his defunct real estate investment "school." The New York attorney general is also suing Trump, alleging fraud by Trump.
The suits are now moving through the courts, and Trump opponents Marco Rubio and Ted Cruz think they have a potent avenue of attack against the real estate mogul.
"There are people who borrowed $36,000 to go to Trump University, and they're suing now," Rubio said. "And you know what they got? They got to take a picture with a cardboard cutout of Donald Trump."
That allegation is mostly true. Donald Trump continues to be haunted by a failed real estate investment school that threatens to pull him into the witness chair in the middle of this presidential campaign. And that opened the door for the second dagger in last night's debate, this time from Texas Senator Ted Cruz.
"You know, Marco made reference earlier to the litigation against Trump University. It's a fraud case, " Cruz told the debate audience before asking Republican voters to think about what that would mean if Donald Trump is called into court to stand trial for fraud, right in the middle of an election.
"If this man is the nominee, having the Republican nominee, on the stand in court, being cross-examined about whether he committed fraud, "Cruz explained, "You don't think the mainstream media will go crazy on that?"
Trump brushed off the attacks saying the case is a civil suit that he intends to win. But it is also true that six years after the school shut down, is he still facing lawsuits.
From the time he launched Trump University in 2005 until it shut down in 2010, about 10,000 students from across the country signed up for the program that promised success in real estate by offering courses and seminars based on the principles of the business mogul himself.
"At Trump University, we teach success," Trump said in a 2005 infomercial when the program was launched. "That's what it's all about. Success. It's going to happen to you."
Now, Trump is facing three separate lawsuits -- two class action suits filed in California and one filed by New York's attorney general -- which argue the program that took in an estimated $40 million, but was mired in fraud and deception.
"We started looking at Trump University and discovered that it was a classic bait-and-switch scheme. It was a scam, starting with the fact that it was not a university," New York Attorney General Eric Schneiderman told CNN's "New Day" after filing suit in 2013.
Fraud in these cases may be difficult to prove. The fact that the overwhelming majority of students had zero chance of succeeding as a real estate investor does not constitute fraud. The plaintiffs are going to have to prove intent – a very difficult proposition without documentation.
Trump U's claims were always too good to be true, which should have alerted any potential student that what the school was selling wasn't so much knowledge but rather Trump himself. In this, as in other instances where a company over-promises, the phrase caveat emptor should rule.
As a campaign issue, the suits are a dead letter. Trump supporters don't care what crimes their candidate may have committed. A Rubio super-PAC is running ads featuring the suits in several states. Over time, the issue may resonate with the voters, but time is one thing Rubio and Cruz don't have.