Jane Sanders Being Investigated by the FBI for Fraud
Jane Sanders, wife of Vermont Senator Bernie Sanders, is being investigated for bank fraud by the FBI. The investigation relates to loans that Sanders took out when she was president of the now defunct Burlington College.
The small Vermont liberal arts school closed down in May 2016, after going bankrupt and failing to meet accreditation standards.
The college began to face financial difficulties during Sanders's tenure from 2004 to 2011, falling $10 million into debt when the school purchased a new campus in 2010.
Sanders has been accused of falsifying the information on the loan documents in order to expand the college grounds.
The VTdigger.org reported that some of the donors Sanders appealed to for help with loans are now in contact with the FBI and Federal Deposit Insurance Corporation (FDIC).
Sanders left her leadership role in 2011 for undisclosed reasons.
She claimed the college could count on $2.6 million in donations to pay for the purchased land, according to a 2010 loan application. But she ultimately raised only a fourth of that, making $676,000 in donations over the next four years, putting the college into bankruptcy in May 2016.
The numbers that donors say they pledged compared to what Sanders documented differ, according the report.
The report cites an example where Corinne Bove Maietta pledged to give $1 million over half a decade, according to the 2010 loan application. Maietta, however, says she did not make that pledge, saying she offered a bequest of an unspecified amount to be paid to the college when she died, the report said.
Sanders had delusions of grandeur that she could turn her small college into a major institution. The land she purchased for the new campus was twice the area of the old campus and situated along Lake Champlain. As Politico explained, this was a horrible idea:
Jane Sanders took the helm in 2004 after having a successful year as interim president at Goddard College, in rural Plainfield, Vermont, and working in various roles for her husband. In an interview with the Burlington Free Press at the time, she cited building enrollment and expanding the school’s small endowment as priorities. The college adopted a plan to offer more majors and graduate-degree programs, renovate its campus and grow enrollment a couple of years later. And in 2010, Sanders and the board went further: She brokered a deal to buy a new plot of lakefront land with multiple buildings from the Roman Catholic Diocese to replace the college’s cramped quarters in a building that used to house a grocery store. The college used $10 million in bonds and loans to pay for the campus, according to reports by the Burlington Free Press.
“People are worried about student debt, but this is one of the reasons that college costs go up,” Holt said. “Because every college wants a new campus — and students get charged for that.”
Sanders and the board of trustees hoped alumni donations and expanding the student body would help pay off the debt. But enrollment in the years that followed didn’t rise much, and fundraising efforts fell short.
Sanders resigned in 2011 after months of debate about the college with its board, but neither Sanders nor the college gave a specific reason for her departure. Her successor, Christine Plunkett, was tasked with figuring out how to pay back the college’s debts. Plunkett tried recruiting new students from China but had little luck. In 2013, key faculty had their hours and benefits cut, and some resigned. In 2014, the college’s accreditor placed the school on probation because of its shaky finances.