A pair of former employees of Trump University, the for-profit real estate school launched by presumptive Republican presidential nominee Donald Trump, described the courses as a "fraudulent scheme" focused on making money rather than educating students in court testimony released Tuesday night.
"Based upon my personal experience and employment, I believe that Trump University was a fraudulent scheme, and that it preyed upon the elderly and uneducated to separate them from their money," Ronald Schnackenberg, a Trump University sales manager from 2006-2007, said in his testimony.
The newly unsealed documents, part of a federal lawsuit filed by former students unhappy with the Trump University experience, paint an unflattering portrait of the for-profit university that used Trump’s name and reputation to sell real-estate investment courses priced in the tens of thousands of dollars, often knowingly to buyers who couldn’t easily afford them.
And they opened a new line of attack for presumptive Democratic presidential nominee Hillary Clinton, who said Wednesday during a rally in New Jersey that the documents offered “just more evidence that Donald Trump himself is a fraud” and is “trying to scam America the way he scammed all those people at Trump U.”
Jason Nicholas, a sales executive at the university from May through October of 2007, said he felt the courses “did not provide a legitimate real-estate education” and Trump University was "just selling false hopes and lies."
While Trump University is only a small sliver of Trump’s business empire, it’s taken on outsize significance in the presidential race as his opponents on both sides of the aisle have tried to use it to attack the GOP nominee as a "con man" and a "fraud" whose entire career — and presidential campaign — is aimed at benefiting only himself.
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Republicans Ted Cruz and Marco Rubio both hammered that theme home during the GOP primary, but were unable to make it stick. Though Trump has the lowest favorability of any GOP nominee in history according to public opinion polls, he eventually surged to a decisive primary win.
Hillary Clinton’s campaign, however, believes it will have better luck by highlighting Trump University as part of an overall pattern of self-serving business practices and drawing out their argument over the course of the months-long general election battle. In her remarks Wednesday, Clinton charged that, through Trump University, the GOP candidate was "encouraging" Americans "to max out their credit cards, empty their retirement savings, destroy their financial futures, all while making promises they knew were false from the beginning."
The new documents, unsealed by a court order issued last weekend, do include testimony from a number of former Trump University staffers and customers defending and expressing satisfaction with the courses.
Mark Covais, Director of Operations for Trump Entrepreneur Initiative, collected and analyzed data on the courses and said a large majority of the students reported positive experiences.
"Ninety-seven percent of TU students who provided written evaluations rated TU programs 4.85 or higher on a 1-5 scale, with 5 being the highest score in terms of customer satisfaction," he said in his testimony.
Amy Hinderer, a Trump University customer, expressed “enthusiasm” with her experience with the courses in her testimony, and said she never felt misled by university staffers.
"There were never any false promises made to me,” Hinderer said. “Trump University provided me the necessary tools, but it is my responsibility to execute the action plans to make the business happen,” she said.
And the Trump Organization’s legal counsel also directed NBC News to a video featuring three Trump University customers touting the benefits of the courses, with one calling the courses “outstanding” and another saying he received “incalculable” returns from the courses:
But the testimony of both Schnackenberg and Nicholas are sure to offer Democrats further fodder for attack as they continue to develop their case in the campaign against Trump as a "fraud."
Both described Trump University instructors as ill-qualified, despite Trump claiming at one point in a promotional video that they "are all people that are handpicked by me." Nicholas said the Trump University instructors and mentors were a "joke" and "unqualified people posing as Donald Trump’s ‘right-hand men.'"
"They were teaching methods that were unethical, and they had had little to no experience flipping properties or doing real estate deals. It was a facade, a total lie," he said.
And the two also testified that the goal of Trump University seemed more to make money off of sales than to instruct buyers on real-estate strategies. For Nicholas, "the whole focus of Trump University was on selling, not on teaching information."
Schnackenberg testified that "the primary goal of Trump University was not to educate students regarding real estate investing. The primary focus seemed to make money, as quickly and easily as possible."
Both recalled what Schnackenberg described as a "scheme involving a constant upsell."
As Nicholas described it, "Trump University had a policy and practice that if a student gave high ratings on an evaluation form, we were supposed to immediately call them back and try to up-sell them — to get them to sign up and pay for more seminars."
The aggressive sales tactics were outlined in detail in a pair of "playbook" manuals released as part of the unsealed court documents Tuesday. The manuals instructed salespeople to play to people’s emotions in order to get them to purchase the expensive courses, and to tell them "you've found an answer to their problems and a way for them to change their lifestyle."
But in his testimony, Schnackenberg highlighted the human cost of those sales techniques.
He recounted the story of a couple who attended a seminar in New York City in the Spring of 2007 and would’ve had to pay for their Trump University courses using the husband’s disability income and taking out a loan based upon equity in their apartment. When Schnackenberg failed to sell them on the program, "I was reprimanded for not trying harder" and another salesman took over and got them to sign onto the most expensive package, costing nearly $35,000.
It was enough, Schnackenberg said, to cause him to leave the university entirely.
"I resigned from my position in May of 2007 because I believed that Trump University was engaging in misleading, fraudulent and dishonest conduct," he said.
