The wife of Socialist Senator Bernie Sanders, Jane, was the president of a small college in Burlington, Vermont for about seven years. During her tenure as college president, she decided to double the size of the campus. To do that, the college would need to borrow 10 million dollars in debt in order to expand. The Daily Caller has received documents that show that the loans were fraudulent. In order to get the loan, the college had to prove they had confirmed commitments amounting to 2.27 million over a five year period.
Sanders’ plan was to purchase 17 acres on the shore of Lake Champlain from the Archdiocese that needed to raise funds to pay off a sex abuse settlement. She planned to refurbish existing buildings that would allow the college to expand from 200 full time students to 400.
Jane Sanders had to apply to Vermont Educational and Health Buildings Finance Agency (VEHBFA),an agency run by the state that issues the tax free bonds. People’s Bank had agreed to buy the bonds. The only catch at that point was proving the 2.27 million in incoming donations. Sanders gave them a list of 31 endowments totaling 2.6 million and she told them with unconfirmed donations and pledges, the number they were expecting was just about five million. Evidently, someone fudged the numbers because the actual total was just 1.3 million.
That was a steep shortfall for a college an annual budget of only 4 million and no endowment at all. The college was taken to the brink of bankruptcy and Sanders resigned just before she would have been shown the door, but not before she got a very generous severance package. That package was worth $200,000 to Sanders.
They should have known that the deal was based on erroneous figures. Because of the vast difference in the actual amount of commitments and the fact that their track record never showed such high donations, you would think some smart fellow would notice it.
Actually, one smart fellow did. The VEHBFA had a fairly casual approach to their approvals, not even recording the voting. But the loan for Burlington College was quite different. One voter, Tom Pelham, demanded that his objection to the loan be recorded for proof in the future that he would not be held accountable for a loan he believed was financially insecure and that only the bank and the developer who would buy the property from the bank being the only winners.
The problem is Vermont is a very rural state and knowing a politician of Bernie Sanders stature was the best way to get people to overlook trivial matters like the numbers not jiving with reality. It also didn’t hurt that real estate developer, Tony Pomerleau, was on board. He was known for success in developing retail shopping space, so the project was considered safe with both Sanders and Pomerleau on board.
Sources say that if it is proven she intentionally inflated the numbers, she could be charged.
Christine Plunkett, Sanders’ successor as Burlington College president,explained this shift last summer, when she told a local TV station that after becoming president she was surprised to find that a million dollar “donation” was actually a bequest (Plunkett did not respond to TheDCNF’s interview request).
The accountant who spoke with TheDCNF said such a mistake was egregious, because bequests are far less legally binding (wills can be changed or invalidated). Such bequests shouldn’t be counted as confirmed contributions, he said.
Spilbor said that if Sanders or anybody else had knowingly garnished their confirmed donation figures, it would be “a pretty clear cut case” of fraud committed against the state.
It will make entertaining reading in the future.
No word on how this will affect Bernie’s run for president.