US & Canada

New York State sues Donald Trump investment school for $40m

Donald Trump file picture February 2013

The state of New York has sued US property tycoon Donald Trump for $40m (£26m), alleging that his investment school engaged in illegal practices.

Prosecutors said the private Trump University had no licence and misled students into taking courses claiming to teach investment tricks.

More than 5,000 people allegedly paid over $40m to take the courses.

Mr Trump said in a tweet that New York State's attorney general was "trying to extort me with a civil law suit".

The tweet linked to a website saying that Trump University, as it was called until 2010, had a 98% approval rating.

In 2011 it changed its name to Trump Entrepreneur Initiative, but has attracted complaints and some civil lawsuits from people who said the school did not deliver what was promised to participants.

On Saturday Attorney General Eric Schneiderman said: "No-one, no matter how rich or popular they are, has a right to scam hard-working New Yorkers."

Between 2005-11, prosecutors allege, the school made false claims about its classes, including that Mr Trump hand-picked the teachers.

But the celebrity property developer did not select a single instructor, and was barely involved with structuring the courses, the prosecutors added.

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