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UpInArms

(51,284 posts)
Thu Mar 14, 2019, 08:49 AM Mar 2019

Taxpayers may have paid $10 million to help wealthy families bribe their way into elite schools

One of the more stunning aspects of the college admissions scandal unveiled this week is that the alleged bribes to secure wealthy children spots at elite schools were tax deductible. That means American taxpayers may have helped foot the bill for the alleged scam.

“That’s why we should care about this, other than the Schadenfreude of rich people getting their due,” said Sam Brunson, a tax law professor at Loyola University Chicago.

In a worst-case case scenario, if all $25 million that the arrested parents allegedly paid out was funneled through a public charity and claimed as tax deductions, as prosecutors outlined in a criminal complaint, then taxpayers chipped in roughly $7 to $10 million, said Phil Hackney, a tax law professor at University of Pittsburgh.

“Assuming these are all high-income individuals, they’re all paying at the highest tax rate which presumably was about 40% roughly,” Hackney told MarketWatch. “Assuming they were able to deduct the entirety of it, that would be 40% of the $25 million. That’s somewhere in the neighborhood of $7 to $10 million approximately that taxpayers are footing the bill for, and that’s troubling.”

... more at https://www.marketwatch.com/story/taxpayers-may-have-paid-10-million-to-help-wealthy-families-bribe-their-way-into-elite-schools-2019-03-14?mod=mw_theo_homepage

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Taxpayers may have paid $10 million to help wealthy families bribe their way into elite schools (Original Post) UpInArms Mar 2019 OP
Perhaps an audit is in order Sherman A1 Mar 2019 #1
Yes! GWC58 Mar 2019 #2
Fraud can mean prison exboyfil Mar 2019 #9
Prison for whom? Nasruddin Mar 2019 #12
Yes, crime (fraud) pays if you are wealthy and can pay attorneys to bargain for a settlerment. KPN Mar 2019 #14
I think both need some "correctional time," GWC58 Mar 2019 #23
Not just that OnlinePoker Mar 2019 #13
Yes! They should be forced to pay lost wages, GWC58 Mar 2019 #24
Agreed Sherman A1 Mar 2019 #26
He had over 700 clients, they only arrested 33 so far nt lostnfound Mar 2019 #3
These people had every advantage mercuryblues Mar 2019 #4
That they did, and it still wasn't enough for them gratuitous Mar 2019 #30
So it's legal for schools to take bribes but not individuals? populistdriven Mar 2019 #5
The schools were not conspirators in this case. NNadir Mar 2019 #8
Yes, that's correct. There's an old-fashioned way to buy your kid's admission to a school. yardwork Mar 2019 #17
The other really zentrum Mar 2019 #6
This is true. My son is attending a university... NNadir Mar 2019 #10
USC has a lot of students from poor families More_Cowbell Mar 2019 #16
I honestly don't believe that your degree is devalued by this. yardwork Mar 2019 #18
I haven't been asked about my degree in decades. NNadir Mar 2019 #31
I don't believe that wealthy donors will stop supporting these schools because of this. yardwork Mar 2019 #19
Thank you. That's a reassuring idea. zentrum Mar 2019 #25
Big problem, but there are others RoadRunner Mar 2019 #7
A suggested edit: replace "Maybe that's" with "Largely" KPN Mar 2019 #15
I agree. TxVietVet Mar 2019 #28
Pull on this thread a little further exboyfil Mar 2019 #11
Won't happen, because the highly wealthy and privileged will protect the system. yardwork Mar 2019 #20
Yep...those "deductions" should have to be paid back immediately.......... Bengus81 Mar 2019 #21
Taxpayers didn't "foot the bill" or "help pay." JayhawkSD Mar 2019 #22
Pretty sure everyone understood what they meant. cpamomfromtexas Mar 2019 #29
Back to f*cking over working folks. TxVietVet Mar 2019 #27

Sherman A1

(38,958 posts)
1. Perhaps an audit is in order
Thu Mar 14, 2019, 08:53 AM
Mar 2019

along with some back taxes and penalties for all those involved in these schemes.

GWC58

(2,678 posts)
2. Yes!
Thu Mar 14, 2019, 09:00 AM
Mar 2019

Unpaid taxes and a very serious, heavy fine. America loves to forgive. However not on something as agregious as this. I don’t look to see these two, let’s call them what they are, GRIFTERS in anything on tv/movies anytime soon. If ever! 😡

Nasruddin

(754 posts)
12. Prison for whom?
Thu Mar 14, 2019, 10:45 AM
Mar 2019

For this type of white collar crime, as we have seen, probably very light punishments.
$25000 fines. Some will lose their big shot positions because of bad
publicity. Their kids will suffer - they'll get booted.

For the small-fry bribe takers - probably some hard time coming. Unless there are
senior officials involved, then see above.

KPN

(15,646 posts)
14. Yes, crime (fraud) pays if you are wealthy and can pay attorneys to bargain for a settlerment.
Thu Mar 14, 2019, 10:52 AM
Mar 2019

What's $25,000 when you paid yourself literally hundreds of thousands via this scheme?

This is exactly what the Trump Foundation provides for Trump. An ability to pay pennies for the dollar. And the only reason beside having his name on it that he has a foundation

GWC58

(2,678 posts)
23. I think both need some "correctional time,"
Thu Mar 14, 2019, 11:44 AM
Mar 2019

in a cell, to think long & hard on their cheating, grifting ways. Oh yeah, and after release community service. Hours and hours of community service. Like helping the kinds of children their grifting helped screw them out of their going to college. 👍🏻

OnlinePoker

(5,722 posts)
13. Not just that
Thu Mar 14, 2019, 10:50 AM
Mar 2019

Production on Lori Laughlin's show Garage Sale Mysteries was shut down yesterday and all the workers laid off. Payment to them for lost wages should also be on the table.

GWC58

(2,678 posts)
24. Yes! They should be forced to pay lost wages,
Thu Mar 14, 2019, 11:48 AM
Mar 2019

as well as paying for lost health coverage, if they had it. 🤔

mercuryblues

(14,532 posts)
4. These people had every advantage
Thu Mar 14, 2019, 09:21 AM
Mar 2019

this country has to offer. They could afford private schools, tutors, private coaches and give large donations to the schools they were interested in. All of that would increase and ensure their kids admittance into the schools.

Instead they cheated there way in. They took a spot from another kid.

Dean Norris

I got into Harvard against long odds via hard work and perseverance. Neither of my parents went to college, we didn’t have money 2 even pay for SAT prep course let alone bribes. “Shameful. It’s hard enuf for working class kids 2 succeed w/o rich privilege taking opportunity away.

When I think of all the kids who studied hard, stayed up late, had part time jobs to pay for their college application fees, and then were denied rightly deserved places in elite colleges because some rich fuckwads cheated for their already privileged kids — I’m disgusted, I shall now breathe deep and go beat the s–t out of a punching bag.



gratuitous

(82,849 posts)
30. That they did, and it still wasn't enough for them
Thu Mar 14, 2019, 12:23 PM
Mar 2019

Which gives us an answer to the eternal question about trickle down economics and self-funding tax cuts. When will the rich and the really rich ever have enough of our national wealth? Never.

So we might as well work toward a society where those who have much do not have too much and those who have little do not have too little. And we can safely ignore the pained squawks of the well off, who will never ever have enough.

populistdriven

(5,644 posts)
5. So it's legal for schools to take bribes but not individuals?
Thu Mar 14, 2019, 09:34 AM
Mar 2019

In the college entrance case the prosecuting attorney stated,

"this does not compare to giving money for a new building or something and getting preference treatment for student entrance. "

yardwork

(61,650 posts)
17. Yes, that's correct. There's an old-fashioned way to buy your kid's admission to a school.
Thu Mar 14, 2019, 11:06 AM
Mar 2019

It costs a lot more than these people paid, though. It takes a charitable donation of at least tens of millions to buy a family member admission at an elite school.

These people took a cheap, illegal route.


zentrum

(9,865 posts)
6. The other really
Thu Mar 14, 2019, 09:59 AM
Mar 2019

...ugly thing about this is that the kids who got in by their own hard sweat and tears are now in places where the reputation is tarnished. And where they themselves will be looked at with suspicion, unless they go around with signs that say "I'm a student in debt" or "I'm a scholarship student".

Speaking of which---I think the endowment of these places will also be hurt--which hurts the scholarship kids! THose scholarhsip kids go through hell to be accepted and to stay in such institutions. They go--but can barely afford housing, food, books.

Meantime, most of Europe educates its motivated kids, tuition free.

Have been looking everywhere for how and why this scandal was uncovered. Why did this suddenly come to light out of nowhere after going on for years?

NNadir

(33,525 posts)
10. This is true. My son is attending a university...
Thu Mar 14, 2019, 10:28 AM
Mar 2019

...that middle class parents like myself could never afford, weree it not for the generous financial aid package.

He has gratefully signed nonbinding statements that he will remember why he was able to get this spectacular education should he succeed in life.

One of his fellow high school students, also admitted, was a legacy kid. She was uncertain enough of her admission to apply early decision.

She was elated to get in after her brother had been rejected. She works very hard, struggles a bit, but holds her own. I don't resent that she didn't need quite the academic standing my son did for admission. Her parents are among those who made my son's attendance possible. I expect my son to show gratitude if he does well.

There is a difference between gratitude and corruption.

More_Cowbell

(2,191 posts)
16. USC has a lot of students from poor families
Thu Mar 14, 2019, 11:02 AM
Mar 2019

Because it's one of the few southern California schools that pledges to meet 100% of financial need. It's a school of a lot of rich kids whose tuition is supporting a lot of poor students, which I always remembered when I was there. I'd be in line for my financial aid behind a parent who might be writing a check for two kids' tuition.

When I was there, staff members got tuition breaks of, I think, 50% for their kids. I have friends whose parents worked in the cafeteria or in maintenance. They were also grateful to be there.

I applied from out of state to SC and to UCLA, and SC gave me a huge scholarship so that it was cheaper to go there. That's as it should have been; I didn't realize back then that of course UCLA would save its scholarship money mostly for in-state students.

I feel my degree getting devalued every day.

yardwork

(61,650 posts)
18. I honestly don't believe that your degree is devalued by this.
Thu Mar 14, 2019, 11:08 AM
Mar 2019

People recognize that this fraud was perpetrated by individuals, not the schools.

NNadir

(33,525 posts)
31. I haven't been asked about my degree in decades.
Thu Mar 14, 2019, 09:01 PM
Mar 2019

Pretty much I'm defined by what I know, not where I went to school. I supervise people who went to more prestigious schools than I did, and I have people from top schools come to me to ask if I can get them jobs.

All this made some small difference early in my career with respect to getting doors opened, but once the door opened, I was never kicked back out of it.

If I meet someone who went to Princeton or MIT, I can tell pretty quickly about how they got there and more importantly how they did there, and what they've been since they left there.

You got a good education, and your work will show it.

My son is attending a "hidden Ivy" and he can tell the difference among his peers, and could by his Freshman year. There is a big difference in the circles in which he, a merit student, and they, in their by virtue of money and connections, commiserate.

In general, they, the money people, party, mostly because they are crippled for life by not knowing the value of things.

There have always been cheaters. I'm sure for example, that Donald Trump never took an honest exam in his life. Perhaps they take a different form in these times, but they are not qualitatively different from Trump types 50 years ago. These people have nothing to do with you; nothing really to do with USC, except for the fact that the USC search committees may have hired people with extremely poor ethics in their athletic departments. I'm sure you didn't major in attending football games.

You cannot let yourself be devalued without your consent, to paraphrase Eleanor Roosevelt. If there is someone who automatically associates you and these people, you probably don't want to be too involved with that person anyway.

You know what you did to get your degree.

Let it shine.

yardwork

(61,650 posts)
19. I don't believe that wealthy donors will stop supporting these schools because of this.
Thu Mar 14, 2019, 11:11 AM
Mar 2019

In fact, I believe that the wealthy donors will respond by thinking that these are criminal, low-class posers. The donors' reaction will be to circle their own wagons of wealth and privilege. They're probably sneering at the people who've been charged.

RoadRunner

(4,495 posts)
7. Big problem, but there are others
Thu Mar 14, 2019, 10:07 AM
Mar 2019

Many of these entitled rich white kids who cheated their way through every challenge will soon be running the country. Always have. Maybe that’s why we get airplanes that fall out of the sky, crumbling bridges, meds that kill, and the constant assault on public education.

KPN

(15,646 posts)
15. A suggested edit: replace "Maybe that's" with "Largely"
Thu Mar 14, 2019, 11:00 AM
Mar 2019

This crap makes me furious. I know that generalizations are flawed, but ... Fuck the upper crust!

exboyfil

(17,863 posts)
11. Pull on this thread a little further
Thu Mar 14, 2019, 10:31 AM
Mar 2019

How many big contributions to schools are reported as charitable deductions. How many are quid pro quo for getting Junior into the respective college? Any documented evidence that quid pro quo existed is tax fraud. If you have to remove the value of the steak dinner for a dinner charity ticket claimed on taxes, you should also have an imputed value for that admission. I would claim this prosecution shows that value is quite high.

Something like this could break the entire system open if someone was willing to push.

Bengus81

(6,931 posts)
21. Yep...those "deductions" should have to be paid back immediately..........
Thu Mar 14, 2019, 11:14 AM
Mar 2019

Then throw these thugs in JAIL............

 

JayhawkSD

(3,163 posts)
22. Taxpayers didn't "foot the bill" or "help pay."
Thu Mar 14, 2019, 11:21 AM
Mar 2019

Since the bribes were tax deductible, taxpayers were deprived of money that was owed to them, meaning that the government received less revenue than it should have, but "to pay" means to give someone money, and no government (taxpayer) money was given to the schools. To have one's income reduced is not the same as giving payment.

You can engage in some sort of sophistry to the effect that the bribers would not have been able to afford the bribes had they not been tax deductible, but that is nonsense. The money they paid in bribes was on the scale of petty cash to those people.

The taxpayer was certainly cheated, deprived of revenue that was due to it, but it did not "pay" or "foot the bill" for bribery.

cpamomfromtexas

(1,245 posts)
29. Pretty sure everyone understood what they meant.
Thu Mar 14, 2019, 12:23 PM
Mar 2019

And yes deductions mean a portion of taxes that would have been due would have been reduced. Therefore the rest of us bear the burden of those who cheat.

TxVietVet

(1,905 posts)
27. Back to f*cking over working folks.
Thu Mar 14, 2019, 12:05 PM
Mar 2019

Everyday the rich with the help of bought politicians are screwing us to death.
How much will it take to put a stop it?

Change is going to come and don’t Be surprised if it comes with a vengeance.

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