USA - Corruption - 21st Century
Goldman Sachs agreed 24 July 2020 to pay US$3.9 billion to Malaysia to settle outstanding charges and claims related to the three bond transactions that the global investment bank arranged for 1Malaysia Development Bank (1MDB). The Ministry of Finance said with the settlement and the money that Malaysia had received from the US Department of Justice, more than US$4.5 billion would be returned to Malaysians. "In this regard, the government remains committed to recovering other assets that have not yet been returned." The settlement includes a cash payment of US$2.5 billion and a guarantee for full repayment of at least US$1.4 billion in terms of assets related to the revenue that has been misappropriated through the three bond transactions.
Gov. J.B. Pritzker said 24 July 2020 that Illinois House Speaker Michael Madigan “must resign” if allegations of corruption are true against the fellow Democrat long considered the state’s most powerful lawmaker. Madigan, who also serves as chairman of the Democratic Party of Illinois, denied wrongdoing. Federal prosecutors said electric utility ComEd has agreed to pay $200 million to resolve a federal criminal investigation into a long-running bribery scheme that implicates Madigan. They say the company has admitted that from 2011 to 2019 it arranged for jobs and vendor subcontracts “for various associates of a high-level elected official for the state of Illinois." More than half a dozen Illinois Democrats — including some former Madigan confidants and allies — have been charged with crimes or had agents raid their offices and homes.
On 23 July 2020, Ohio Gov. Mike DeWine called for the repeal of HB 6, the energy bill passed in 2019 now tied to a bribery scandal in the Ohio legislature. A criminal complaint unsealed 21 July 2020 accused FirstEnergy Corp. of bribing Ohio Rep. Larry Householder, speaker of the Ohio House of Representatives, and four others to secure a bailout of the utility’s nuclear plants. The law was a multibillion-dollar gift to FirstEnergy, a private electric utility that has resisted climate policy for decades. It turns out it was a gift paid for with $61 million in bribes. The Edison Electric Institute, the national private utility association, gave FirstEnergy an award for its work to pass HB 6.
At every level of government, the Justice Department is committed to enforcing the laws that protect the integrity of our government. Because of this commitment to the rule of law, ordinary citizens are able to rely on and expect the honesty and integrity of government officials and other holders of the public's trust.
The Department has enjoyed tremendous success rooting out corruption and holding public officials who misuse their office or misspend taxpayer dollars accountable for their actions.
From 2001 to 2006 the Department of Justice charged 6,899 individuals with public corruption offenses nationwide and obtained 5,876 convictions. An overview of the Department's recent activities in this area includes the following:
The Criminal Division's Public Integrity Section
- The Criminal Division's Public Integrity Section was created in 1976 to
consolidate into one unit the Justice Department's responsibilities for the
prosecution of criminal abuses of the public trust by government
officials.
- The number of defendants charged by the Public Integrity Section in the
six-year period from 2001 to 2006 increased by 52 percent over the eight year
period from 1993 to 2000, and the number of convictions increased by 31 percent
over the same period.
- From 2001 through 2006, the Public Integrity Section charged 365
individuals with public corruption offenses and obtained 332 convictions. The
year-by-year breakdown is as follows:
| Year | Defendants Charged | Defendants Convicted/Pleaded Guilty |
| 2001 | 57 | 36 |
| 2002 | 37 | 45 |
| 2003 | 85 | 61 |
| 2004 | 48 | 43 |
| 2005 | 95 * | 84 |
| 2006 | 43 | 63 |
| TOTAL | 365 | 332 |
| PER YEAR AVG. | 60.83 | 55.33 |
- From 1993 to 2000, the Public Integrity Section charged 240 defendants and obtained 253 convictions. The year-by-year breakdown for that time period is as follows:
| Year | Defendants Charged | Defendants Convicted/Pleaded Guilty |
| 1993 | 27 | 37 |
| 1994 | 38 | 33 |
| 1995 | 20 | 31 |
| 1996 | 34 | 39 |
| 1997 | 35 | 29 |
| 1998 | 26 | 33 |
| 1999 | 28 | 21 |
| 2000 | 32 | 30 |
| TOTAL | 240 | 253 |
| PER YEAR AVG. | 30 | 31.63 |
- The Public Integrity Section works closely with dedicated and specially
trained agents at the FBI to investigate and prosecute public corruption at all
levels of government. The FBI currently has 642 special agents dedicated to
public corruption matters, up from 358 in 2002.
- The Department's renewed commitment to the investigation and prosecution of public corruption is reflected not so much by an increased case load - though the Department has, in fact, brought more public corruption cases in recent years - but rather by the quality, complexity and profile of the cases we have successfully pursued.
The U.S. Attorneys' Offices:
- The available numbers for prosecutions of public corruption by U.S.
Attorneys offices nationwide also demonstrate the Department's commitment to
bringing these cases. From 2001 to 2006, the Department charged a total of
6,899 individuals with public corruption and obtained 5,876 convictions*:
| Year | Defendants Charged | Defendants Convicted/Pleaded Guilty |
| 2001 | 1,087 | 920 |
| 2002 | 1,136 | 1,011 |
| 2003 | 1,150 | 868 |
| 2004 | 1,213 | 1,020 |
| 2005 | 1,163 | 1,027 |
| 2006 | 1,150 | 1,030 |
| TOTAL | 6,899 | 5,876 |
| PER YEAR AVG. | 1,149 | 979 |
- By way of comparison, in the six-year period from 1995 to 2000, the
Department charged 6,400 individuals with public corruption offenses and
obtained 5,650 public corruption convictions.
| Year | Defendants Charged | Defendants Convicted/Pleaded Guilty |
| 1995 | 1,051 | 878 |
| 1996 | 984 | 902 |
| 1997 | 1,057 | 853 |
| 1998 | 1,174 | 1,014 |
| 1999 | 1,134 | 1,065 |
| 2000 | 1,000 | 938 |
| TOTAL | 6,400 | 5,650 |
| PER YEAR AVG. | 1,066 | 941 |
RECENT DEVELOPMENTS AND ONGOING EFFORTS - DOMESTIC
Congressional Cases:
- In February 2008, the Department indicted Arizona Congressman Rick Renzi
and two of his business associates on 27 counts of honest services wire fraud,
extortion, money laundering, and conspiracies to engage in these
acts.
- In June 2007, the Department indicted Louisiana Congressman William
Jefferson on public corruption counts, including conspiracy, bribery, honest
services fraud, RICO, the Foreign Corrupt Practices Act (FCPA) and obstruction
of justice. Rep. Jefferson is the first U.S. government official to be charged
with violations of the FCPA.
- Former California Congressman Randall Cunningham pleaded guilty to
bribery and was sentenced in March 2006 to more than eight years in
prison.
- In February 2008, Defense contractor Brent Wilkes was sentenced to 12
years in prison for funneling cash, mortgage payments, cars, meals, luxury
travel and prostitutes to former Congressman Cunningham in return for the
Congressman's assistance in steering contracts to Wilkes' company.
- Defense contractor Mitchell Wade pleaded guilty to bribery, conspiring to deprive the Defense Department of the honest services of its employees and election fraud. Wade admitted to making more than $1 million in illegal payments to Congressman Cunningham, providing illegal benefits to Defense Department employees and attempting to curry favor with two other members of Congress by making illegal campaign contributions.
The ongoing Abramoff investigation is being conducted by the Public Integrity and Fraud Sections of the Criminal Division and has netted 12 convictions thus far, including the following:
- Former lobbyist Jack Abramoff pleaded guilty in January 2006 to
conspiracy, honest services fraud and tax evasion.
- Mark D. Zachares, a former high-ranking aide to the U.S. House of
Representatives Transportation & Infrastructure Committee, pleaded guilty in
April 2007 to a one-count indictment charging him with conspiracy to commit
honest services wire fraud.
- Ohio Congressman Robert Ney pleaded guilty in September 2006 to
conspiracy to commit multiple offenses B including honest services fraud, making
false statements violations of his former chief of staff's one-year lobbying ban
B and to making false statements to the U.S. House of Representatives. Ney was
sentenced to 30 months in prison.
- Former lobbyist Michael Scanlon pleaded guilty in November 2005 to
conspiracy to commit bribery and honest services fraud.
- Former lobbyist Neil Volz pleaded guilty in May 2006 to honest services
fraud and violating the one-year lobbying ban. Volz was sentenced in September
2007 to two years probation and ordered to pay a $2,000 fine. Volz received a
reduced sentence based on his substantial assistance to the government's
investigation.
- Former lobbyist Tony C. Rudy pleaded guilty in March 2006 to conspiring
with Jack Abramoff, Michael Scanlon and others to commit honest services fraud,
mail and wire fraud, and a violation of conflict of interest post-employment
restrictions.
- William Heaton, former chief of staff for Ohio Congressman Robert Ney,
pleaded guilty to conspiracy to commit honest services wire fraud on Feb. 26,
2007.
- On June 8, 2007, Italia Federici, president of the Council of
Republicans for Environmental Advocacy, pleaded guilty to tax evasion and
obstruction of the U.S. Senate's investigation into the Abramoff
scandal.
- On Dec. 15, 2005, Adam Kidan pleaded guilty at federal court in Miami to conspiracy to commit wire fraud and mail fraud. Kidan, a former business partner of Abramoff's, was sentenced in March 2006 to nearly six years in prison.
Executive Branch Cases:
- In connection with the Abramoff investigation, the Department of Justice
has obtained convictions of the following executive branch
officials:
- In March 2007, James Steven Griles, former Deputy Secretary of the
Department of the Interior, pleaded guilty to obstructing the U.S. Senate's
investigation into corruption allegations surrounding Jack Abramoff. Griles was
sentenced to 10 months in prison in June 2007.
- David Safavian, former Chief of Staff to the Administrator of the GSA
was convicted by a jury in June 2006 of submitting false statements to an ethics
official, Inspector General agents and a Senate committee, and of obstructing
the Inspector General's investigation. Safavian was sentenced to 18 months in
prison.
- Department of the Interior employee Roger G. Stillwell pleaded guilty
in June 2006 to falsely certifying his executive branch confidential financial
disclosure report and was sentenced to six months of probation.
- On Feb. 28, 2008, Jeffrey H. Stayton, the former Chief of the Aviation
Division for the U.S. Army Test and Evaluation Command (ATEC), was sentenced to
63 months imprisonment following his conviction on charges arising from
participation in an honest services wire fraud scheme and a related obstruction
of justice. As an ATEC official, Stayton took actions that favored the
selection of co-defendant William C. Childree's company, Maverick Aviation,
Inc., for a contract worth approximately $4.7 million and misled government
officials about Maverick's performance under the contract.
- In March 2007, Kenneth Harvey, the former Chief of the Acquisition
Logistics and Field Support Branch within the Army's Intelligence and Security
Command (INSCOM), was sentenced to 72 months in prison for accepting more than
$40,000 in bribes from a defense contractor.
- In February 2007, Steven Merkes, a former Department of Defense employee, pleaded guilty to accepting illegal gratuities B including $24,000 in cash and a job offer B in return for official acts while working as an operational support planner in the Future Operations Division of the U.S. Army Headquarters, Special Operations Command-Europe.
Significant State and Local Convictions:
- There has been a commensurate increase in the quality, complexity and
profile of the cases being brought.
- To date, there have been seven criminal convictions arising out of the
ongoing investigation into public corruption in the State of
Alaska.
- James Clark, chief of staff to the former governor of Alaska, pleaded
guilty in February 2008 to conspiracy to commit honest services mail and wire
fraud, and is awaiting sentencing.
- In December 2007, Peter Kott, a former Speaker of the Alaska House of
Representatives, was sentenced to six years in prison following his October 2007
conviction for extortion, bribery and conspiracy.
- In October 2007 Thomas T. Anderson, a former elected member of the
Alaska House of Representatives, was sentenced to five years in prison following
his conviction on seven counts of extortion, conspiracy, bribery and money
laundering.
- Victor H. Kohring, a former elected member of the Alaska House of
Representatives, was convicted at trial in November 2007 for attempted
extortion, bribery and conspiracy, and is awaiting sentencing.
- Additionally, three private individuals B Bill J. Allen, Richard L.
Smith and former Anchorage lobbyist William Bobrick B have pleaded guilty to
felony public corruption. Allen and Smith, former VECO Corporation executives,
provided illegal financial benefits to multiple Alaska elected officials in
exchange for those officials' support on legislation pending before the Alaska
State Legislature.
- On Feb. 27, 2008, in the District of the Virgin Islands, a jury convicted
Dean C. Plaskett, a Commissioner of the Virgin Islands Department of Planning
and Natural Resources, and Marc A. Biggs, a Commissioner of the Department of
Property and Procurement, of demanding and accepting bribes. Plaskett also was
convicted of obstructing justice. The defendants accepted bribes and kickbacks
in exchange for awarding approximately $1.4 million in government contracts and
authorizing more than $1 million in progress payments to contractors who did
little or no work. To date, five other high level Virgin Islands officials and
a businessman from Georgia have been convicted for their roles in this bribery
and kickback scheme.
- Former Governor of Illinois George Ryan, was convicted by a jury in April
2006 on numerous charges including racketeering and honest services fraud. Ryan
was sentenced to 78 months in prison. The conviction was affirmed by the Seventh
Circuit in August 2007.
- Former Governor of Alabama Don Siegelman and former HealthSouth CEO
Richard Scrushy, were convicted by a jury in June 2006 of conspiracy, bribery
and mail fraud. Seigelman was sentenced in June 2007 to serve 88 months in
prison and ordered to pay a $50,000 fine. Also in June 2007, Scrushy was
sentenced to 82 months in prison and ordered to pay a $150,000 fine. Both men
are appealing their convictions.
- Former Mayor of Atlanta Bill Campbell, was convicted by a jury in March
2006 on tax evasion charges. He was sentenced to 30 months in prison in June
2006.
- Former Secretary General Marcos Morell-Corrada and gubernatorial campaign manager Rene Vazquez-Botet of the New Progressive Party in Puerto Rico were convicted of conspiracy, extortion and tax fraud by a jury in November 2006 and sentenced to 60 months in prison.
Election Fraud:
- In 2002, the Attorney General established a Ballot Access and Voting
Integrity Initiative to spearhead the Department's efforts to combat election
fraud and civil rights violations involving voting. To further these goals, the
initiative requires annual training of federal prosecutors in the areas of voter
fraud and voting rights.
- Since the initiative began, the Department of Justice has charged 148
persons with voter fraud and convicted 102 defendants.
- Non-citizens have been convicted of voting-related offenses in Florida,
Colorado, North Carolina and Oregon.
- Vote buying schemes have been successfully prosecuted in Illinois, Kentucky and North Carolina, and persons have been convicted for multiple voting in Kansas and South Dakota.
RECENT DEVELOPMENTS AND ONGOING EFFORTS - INTERNATIONAL
Iraqi Reconstruction:
- The Department has established a unified and coordinated approach for
prosecuting procurement fraud cases associated with Iraqi reconstruction
efforts, forming the National Procurement Fraud Task Force, which uses the
resources of the Antitrust Division and the Criminal Division (particularly the
Public Integrity Section, the Fraud Section, the Office of International Affairs
and the Asset Forfeiture and Money Laundering Section) and the U.S. Attorneys'
offices.
- Among other things, this task force focuses on combating procurement fraud
associated with government spending on the war in Iraq. To date, 46 individuals
and companies have been charged with contract fraud related to the global war on
terror.
- This effort is producing significant results:
- On Jan. 25, 2008, Wallace Ward, a fuel technician employed by the company
KBR, pleaded guilty to conspiracy to defraud and accept bribes in connection
with a scheme to divert to the black market in Afghanistan more than $2 million
in fuel intended for Bagram Airfield. On Feb. 7, 2008, James Sellman, another
KBR fuel technician participating in the conspiracy, pleaded guilty to the same
offense.
- On Jan. 23, 2008, Elie Samir Chidiac and Raman International Inc. were
indicted on charges of conspiring to bribe a military contracting officer in
Iraq. Chidiac is also charged with participating in a scheme with a
co-conspirator military officer to alter contracting documents to allow Chidiac
to fraudulently obtain payment for work not performed, which he then split with
the officer. A preliminary audit indicates the contracting officer received more
than $400,000 from Chidiac. Trial is scheduled for June 9, 2008.
- On Nov. 20, 2007, Terry Hall, a civilian contractor, was indicted by a
federal grand jury in the District of Columbia for allegedly soliciting bribes
while working at Camp Arifjan, an Army base in Kuwait. The indictment charges
that Hall's companies received more than $20 million worth of military contracts
for providing, among other things, bottled water to the U.S. military in
Kuwait.
- On Nov.14, 2007, Chevron Corporation and its subsidiaries agreed to pay
$30 million in a settlement with the Southern District of New York, having
admitted to obtaining Iraqi oil under the U.N. Oil for Food Program from third
parties that paid secret, illegal surcharges to the former government of
Iraq.
- On Aug. 22, 2007, U.S. Army Major John Cockerham, his wife Melissa
Cockerham, and Cockerham's sister, Carolyn Blake, were indicted in federal court
in San Antonio on charges of bribery, money laundering and conspiracy. All
three defendants accepted millions of dollars in bribe payments on Major
Cockerham's behalf, in return for his awarding contracts to corrupt contractors.
Cash bribes paid to the defendants totaled approximately $9.6
million.
- In July 2007, John Allen Rivard, a former major in the U.S. Army Reserve,
pleaded guilty to conspiracy, bribery and money laundering in connection with
his accepting bribes for his fraudulent awarding and administration of U.S.
government contracts in Balad, Iraq. Rivard admitted to receiving more than
$220,000 in bribe payments, as well as to laundering illegal proceeds. On Oct.
19, 2007, Rivard was sentenced to 120 months in prison and three years of
supervised release.
- On Feb. 7, 2007, U.S. Army Col. Curtis G. Whiteford, U.S. Army Lt. Cols. Debra M. Harrison and Michael B. Wheeler, and civilians Michael Morris and William Driver were indicted for various crimes related to a scheme to defraud the CPA - South Central Region in al-Hillah, Iraq. The charges include conspiracy, bribery, money laundering, interstate transportation of stolen property, bulk cash smuggling, tax fraud, and firearms violations.
FCPA Enforcement
- One of the Department's most potent weapons in combating foreign
corruption is the FCPA. Since 2001, the Department has substantially increased
its focus on FCPA violations. In 2007, the Department brought 16 enforcement
actions, compared to four in 2002. While enforcement actions against
corporations have increased, so too have prosecutions of individuals. In 2007,
eight individual defendants either were indicted or pleaded guilty. Three
important FCPA prosecutions brought in 2007 were the cases against Baker Hughes,
Congressman William Jefferson and Vetco International.
- On Apr. 26, 2007, Baker Hughes Services International Inc. entered into
a deferred prosecution agreement and its subsidiary, Baker Hughes Incorporated,
pleaded guilty to violating the FCPA, conspiracy to violate the FCPA, and aiding
and abetting the falsification of the books and records of its parent company
Baker Hughes. As part of the agreements, BHSI agreed to an $11 million fine
which, when considered in conjunction with penalties and disgorgement of profits
imposed by the Securities and Exchange Commission, constitutes the largest
collective penalty ever imposed in an FCPA case, a total of $44
million.
- On Feb. 6, 2007, three subsidiaries of Vetco International Ltd. pleaded
guilty, and a fourth subsidiary entered into a deferred prosecution agreement,
in connection with violations of the anti-bribery provisions of the FCPA that
involved making approximately $2.1 million in corrupt payments to Nigerian
government officials over a two-year period. As part of the plea and deferred
prosecution agreements, the three subsidiaries paid a total of $26 million in
criminal fines, the largest criminal fine to-date in an FCPA
prosecution.
- In addition to charges brought under the FCPA anti-bribery provisions
more than $24 million in penalties have been levied by the Department in cases
involving suppliers of humanitarian goods under the U.N. Oil for Food program.
Because these cases have, thus far, involved payments to the government of Iraq
as opposed to an individual Iraqi official, FCPA bribery charges have not been
brought. Instead, cases have included charges of wire fraud and violations of
the books and records provisions of the FCPA. The two most recent enforcement
actions concerning the U.N. Oil for Food Program were against AB Volvo and
Flowserve Corporation:
- On March 20, 2008, AB Volvo agreed to pay a $7 million penalty as part
of an agreement with the Department regarding charges brought against AB Volvo
subsidiaries Renault Trucks and Volvo Construction Equipment AB (VCE) for
separate conspiracies to commit wire fraud and to violate the books and records
provisions of the FCPA. Employees and agents of Renault Trucks paid a total of
approximately $5 million in kickbacks to the Iraqi government for a total of
approximately 61 million euros worth of contracts with various Iraqi ministries.
Volvo Construction Equipment International AB the predecessor to VCE, and its
distributors were awarded a total of approximately $13.8 million worth of
contracts in return for approximately $1.3 million in kickbacks.
- Flowserve Corporation entered into a three-year deferred prosecution agreement and agreed to pay a $4 million penalty resulting from kickbacks paid to the Iraqi government by employees and agents of its subsidiary, Flowserve Pompes SAS, to obtain contracts with Iraqi ministries for the sale of large-scale water pumps and spare parts for use in Iraqi oil refineries.
* These numbers reflect data that is compiled from annual nationwide surveys of the United States Attorneys' Offices by the Public Integrity Section.
###
Lock Her Up !!
In November 2017 Attorney General Jeff Sessions was reportedly considering appointing a second special counsel to re-investigate the alleged wrongdoings of former Democratic presidential nominee Hillary Clinton, former FBI Director James Comey, and the Obama administration in response to persistent concerns among the Republicans.
The Obama administration allowed Russian nuclear energy agency Rosatom to acquire Canada-based Uranium One, which had significant mining stakes in the US. The deal led to Russia controlling 20 percent of the US' uranium production capacity, although the deal prohibits the exporting of the uranium. Clinton has denied that she had any personal involvement in the decision.
When the deal was announced, the Committee on Foreign Investment in the United States (CFIUS), an interagency US government organization that reviews how foreign investments could impact national security, scrutinized the deal. They ultimately allowed it to go through.
Since then, the FBI has accused Rosatom officials of using bribery, extortion and kickbacks to ensure that the deal happened — and Republicans have gone on to claim that Clinton was among those bribed.
Trump alleged that Russian companies donated a great deal to the Clinton foundation, which may have related to the deal — an accusation rebuffed by the Clintons. "That's your real Russia story. Not a story where they talk about collusion and there was none. It was a hoax. Your real Russia story is uranium," Trump told reporters.
Former CIA Officer and whistleblower Kevin Shipp says what Hillary Clinton did with her charity and Uranium One while she was Secretary of State was a crime for the history books. Shipp explains, “Hillary Clinton used this to launder money in foreign banks so it wasn’t subject to U.S. laws, congressional subpoenas or FOIA demands for the evidence. This was done to launder this money globally into the Clinton Foundation so the U.S. government could not examine it at all.”
Robert Mueller was the head of the FBI while the Uranium One deal was being done by Clinton and the Russians. One fifth of U.S. uranium production was bought by the Russians in a deal Clinton pushed and approved. The Clinton Foundation received more than $140 million from some of the same Russian players who were involved with Uranium One.
Shipp says, “The most bizarre thing is the people who protected her from clear felonious activity and violations of the Espionage Act. James Clapper, Director of National Intelligence, was protecting her and leaking things to the media and lying. You had John Brennan, Director of the CIA, protecting her by starting a false investigation (on Trump) and stirring things up with this (false/unverified) dossier. You had James Comey, Director of the FBI, protecting her...
"Then, you’ve got Peter Strzok protecting her, and now it appears the United Kingdom GCHQ was using NSA information to target Donald Trump and protect Hillary Clinton. You have to ask yourself what kind of power or connections does this woman have to get all of these members of the Deep State, Shadow Government to risk their own criminal penalties to protect her and try to get her elected? That is the Shadow Government. That is the Deep State. That is what is so chilling about this whole thing..."
Previous investigations into the matter had found no signs of wrongdoing, saying that there was no evidence that Clinton had participated in any discussions regarding the sale. Additionally, the purchase required approval from several government agencies which the former secretary of state had no control over.
Varsity Blues
Wealthy families have been donating large sums to colleges and universities for a millennia to get their offspring into prestigious schools – and get their family name inscribed in stone on university buildings or connected to a prestigious post, called a “chair.”
Dozens of individuals involved in a nationwide US$25-million conspiracy that facilitated cheating on college entrance exams and the admission of students to elite universities as purported athletic recruits were arrested by federal agents in multiple states 12 March 2019 and charged in federal court in Boston. Athletic coaches from Yale, Stanford, USC, Wake Forest and Georgetown, among others, are implicated, as well as parents and exam administrators.
Thirty-three parents were indicted, which includes CEOs, and securities and real estate moguls. Sums ranging from US$200,000 to US$6.5 million were reportedly paid to ensure offspring of the accused would be accepted into prestigious universities across the United States.
US Attorney Andrew Lelling said the case is one of “the widening corruption of elite college admissions. … There can be no separate admission system for the wealthy. Every year, talented students work hard ... in a system that grows more and more competitive every year."
Even high-achieving high-school students labor for four years to impress highly selective colleges that have low acceptance rates: Among the schools mentioned in the indictments, only 5 percent of applicants get into Stanford, 7 percent into Yale, 16 percent into University of California-Los Angeles, 17 percent into Georgetown, 18 percent into the University of Southern California, and 29 percent into Wake Forest University.
William “Rick” Singer, 58, of Newport Beach, Calif., was charged with racketeering conspiracy, money laundering conspiracy and obstruction of justice. Singer owned and operated the Edge College & Career Network LLC (“The Key”) – a for-profit college counseling and preparation business – and served as the CEO of the Key Worldwide Foundation (KWF) – a non-profit corporation that he established as a purported charity.
Between approximately 2011 and February 2019, Singer allegedly conspired with dozens of parents, athletic coaches, a university athletics administrator, and others, to use bribery and other forms of fraud to secure the admission of students to colleges and universities including Yale University, Georgetown University, Stanford University, the University of Southern California, and Wake Forest University, among others. Also charged for their involvement in the scheme are 33 parents and 13 coaches and associates of Singer’s businesses, including two SAT and ACT test administrators.
Also charged were John Vandemoer, the head sailing coach at Stanford University, Rudolph “Rudy” Meredith, the former head soccer coach at Yale University, and Mark Riddell, a counselor at a private school in Bradenton, Fla.
The conspiracy involved 1) bribing SAT and ACT exam administrators to allow a test taker, typically Riddell, to secretly take college entrance exams in place of students or to correct the students’ answers after they had taken the exam; 2) bribing university athletic coaches and administrators—including coaches at Yale, Stanford, Georgetown, the University of Southern California, and the University of Texas—to facilitate the admission of students to elite universities under the guise of being recruited as athletes; and (3) using the façade of Singer’s charitable organization to conceal the nature and source of the bribes.
Olivia Giannulli, daughter of televison actor Lori Loughlin and a YouTube star who goes by the name Olivia Jade, had seen increased heat around comments she made after her acceptance at USC. "I don't know how much of school I'm gonna attend," she shared with her nearly 2 million subscribers, after explaining her extensive work schedule. “I don't really care about school, as you guys all know."
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