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Trump Received 'Secret' Payments After Endorsing Pyramid Schemes Targeting Poor, Lawsuit Alleges
By
Jake Offenhartz
Published Oct 30, 2018
Modified Oct 30, 2018
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By
Jake Offenhartz
Published Oct 30, 2018
Modified Oct 30, 2018
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Prior to becoming president, Donald Trump knowingly promoted a host of get-rich-quick schemes as legitimate business opportunities, swindling thousands of hard-working Americans as he collected "large, secret payments" from at least three sketchy companies, according to a new lawsuit.
The complaint, which also names Donald Trump Jr., Ivanka Trump and Eric Trump as defendants, alleges that the family preyed on vulnerable consumers who were most likely to invest in "doomed" services offered by three business entities: ACN, a multilevel marketing company focused on telecommunications; The Trump Network, a diet supplement and vitamin enterprise; and The Trump Institute, a live-seminar program offering "extravagantly priced multiday training seminars" on Trump’s "secrets to success."
In one of many examples cited in the 164-page suit, ACN allegedly paid Trump millions of dollars in exchange for his repeated endorsement of the "home-based business opportunity," in which investors are required to pay $499 to for the chance to sell outdated telecom products. The suit's four plaintiffs—who are using pseudonyms for now—say they invested in the enterprise because of Trump's support for ACN's "amazing" product.
Trump was featured prominently on the "ACN Opportunity Disk" used to pitch the business opportunity to prospective recruits. (via lawsuit)
One plaintiff, a hospice caregiver who joined ACN in 2014, said she spent over $2,000 on meetings and recruitment fees required to become a product salesman, and earned back just $38 in income. A promotional video in which Trump extols ACN as a great business opportunity was a "turning point," according to lawyers. At no point did Trump disclose that he was receiving million of dollars from the company he was routinely promoting, according to the complaint.
Elsewhere in the complaint, the Trump Institute is accused of falsifying and plagiarizing promotional materials for its seminars, which promised to provide a "powerful introduction to the wealth-building strategies...that have made Donald Trump a multi-billionaire." The institute—which Trump was not directly involved in—charged tens of thousands of dollars for its wealth-building seminars, often taking advantage of those most vulnerable.
"Mr. Trump, I am an 85-year-old woman living on a fixed modest income," wrote one woman, according to the suit. "The monthly payment your organization has been deducting from my bank account is creating an ongoing hardship for me."
More often than not, the suit concluded, the victims of the Trumps' deceit were "among the most economically marginalized and vulnerable Americans." The family allegedly knew this, but nevertheless sought to "enrich themselves by systematically defrauding economically marginalized people looking to invest in their educations, start their own small businesses, and pursue the American Dream."
The lawsuit is being funded by Tesseract Research Center, a progressive group led by Democratic donor Morris Pearl, according to the Times. It was filed in Manhattan federal court on Monday.
Neither the White House nor the Trump Organization immediately responded to requests for comment.
You can read the full complaint below:
Complaint (as Filed) by Jake Offenhartz on Scribd
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Jake Offenhartz
Jake Offenhartz is a former Gothamist reporter.
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Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
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