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Donald Trump Faces RICO Class Action

(CN) - Donald Trump's fraudulent Trump University "delivered neither Donald Trump nor a university," in violation of racketeering law, according to a federal class action.

Lead plaintiff Art Cohen claims the real estate mogul "uniformly misled plaintiff and the class that they would learn Donald Trump's real estate secrets through him and his handpicked professors at his elite 'university.'"

Potential students attended free seminars where they were pressured to sign up for a $1,495 three-day seminar that would purportedly teach them everything they needed to know to become successful real-estate investors, according to the lawsuit.

They were told that the longer seminar would include a year-long "apprenticeship program" and may feature an appearance by The Donald himself, and were pitched on Trump Elite mentorship programs that cost $10,000 to $35,000, Cohen claims in the federal lawsuit filed in San Diego.

"However, Trump did not fulfill the promises he made to student-victims around the country - he did not teach students his coveted real estate investing "secrets" at the Live Events, he did not contribute in any meaningful way to the curriculum for the Live Events, and he did not handpick the live event seminar instructors and mentors who 'taught' student-victims at three-day live events and elite mentorship programs - both of which were upsells from the free introductory live event called the 'preview,'" Cohen claims.

The allegations are similar to those made in August by New York Attorney General Eric Schneiderman, who is now investigating the alleged deceptions.

In March 2005, the New York State Education Department allegedly warned Trump that using the term "university" was illegal without a license and asked him to stop.

"Instead of complying, defendant's agents created a fictitious office in Dover, Delaware, and then defendant continued to brazenly operate illegally out of his 40 Wall Street office in New York, New York for five years," according to the class action.

Trump finally stopped offering and selling live events in August 2010, but refused to give students refunds, the class claims.

At least 11 attorneys general and the U.S. Department of Justice fielded "numerous complaints" about Trump University, according to the lawsuit, and the institution received a D- grade from the Better Business Bureau.

Trump vigorously defended himself against the New York attorney general's allegations, reportedly calling Schneiderman a "lightweight" "political hack" who was trying to "extort" him for not doing more for his campaign.

The California class members demand actual and punitive damages for alleged violations of the Racketeer Influenced and Corrupt Organizations Act.

They are represented by Jason Forge with Robbins Geller Rudman & Dowd LLP in San Diego.

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