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12.14 Trump University - Final Paper

12.14 Trump University - Final Paper

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Published by Corey McKeon

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Published by: Corey McKeon on Mar 25, 2012
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CCT625 - Marketing, Advertising & Public Policy: Final Paper
Federal Trade Commissionversus
 Trump University
 (aka
Trump Entrepreneur Initiative
)
Corey McKeon2011 December 20Prof. Adonis Hoffman, JD
 
McKeon | 2
Introduction
Donald Trump became a household name with his television show “The Apprentice,” wherecontestants compete for a high level management position in one of Trump’s enterprises. Prior to
his reality show hit, he was and continues to be a big time business mogul, specifically in realestate. Since the show he has also become a successful author.
1
In 2003, Trump also created anonline education company called
The Trump Entrepreneur Initiative
, formerly known as “TrumpUniversity”. The Trump Entrepreneur 
Initiative offers courses in real estate, asset management,entrepreneurship, and wealth creation, charging fees ranging from $1500 to $35,000.
2
It is
classified by the Better Business Bureau as a “Training Program,” but is not accredited
.
3
 In overview, the issues that Trump University, as it was originally named, face fall underheavy scrutiny as it was said to be in violation of New York Education Law and was found to bemisleading. The campaigns that marketed and advertised for Trump University promised avarying services including:
“complete real estate education”, a “one year apprenticeship,” a one
-on-one mentorship, practical and fail-
safe real estate techniques, a “power team” consisting of 
real estate agents, leaders, personal finance managers and contractors, and were assured thatalthough the Seminars were costly, they would make the money back in their first real estatedeal, and could make up to tens of thousands of dollars per month or more.
4
It was found thatusers, who eventually sued Trump University, were not receiving these benefits. In many
1
 
Wikipedia contributors. “Donald Trump.”
Wikipedia, The Free Encyclopedia.
Wikipedia, The Free Encyclopedia,14 December 2011. Web. 12 December 2011. <http://en.wikipedia.org/wiki/Donald_Trump>
2
 
Wikipedia contributors. “Trump University.”
Wikipedia, The Free Encyclopedia.
Wikipedia, The FreeEncyclopedia, 14 December 2011. Web. 12 December 2011. <http://en.wikipedia.org/wiki/Trump_University>
3
"Trump University Review -TRAINING PROGRAMS in Dover, DE-BBB Business Review."
United States and Canada BBB Consumer and Business Reviews, Reports, Ratings, Complaints and Accredited Business Listings
.
4
Makaeff, Keller, Oberkrom, and Murphy V.Trump University, LLC. Southern Court of California. 16 Dec. 2010.
 Zeldes & Haeggquest, LLP
. 16 Dec. 2010. Web. 12 Dec. 2011. <http://www.zhlaw.com/Trump-University-2nd-Amended-Complaint-12-16-10.pdf>.
 
McKeon | 3publications, Trump University was found to be scamming customers.
5
The Huffington Post for
example, published an in depth overview of the issues presented against the “University”. The
article takes bo
th sides in stating, “Real
-estate seminars like the one Trump operates havesometimes enriched thousands of motivated entrepreneurs, eager to flip houses and make extramoney. But some high-profile hucksters have been indicted for fraud, putting the industry in a
 bad light”. It is also found that “since 2005, over 11,000 people have attended one of his high
-profile real-
estate seminars”.
 The marketing of Trump University is what this paper intends to investigate and under whatpolicies and principles govern the practice of 
marketing a service as a “University,” as it has
been said to be in violation of both New York and Maryland state education laws. The marketingfor this
“University”
could be found directly on their website, in email/online marketingcampaigns and through print advertisements, which can be viewed in
 Appendices A, B,C 
and
 D
.Based on their marketing claims, there appeared to be no substantiation for the resources orsuccess, following the seminar it was found that many of the promised services were false. In thefollowing sections I will provide a factual overview, present the issues of the case, provide ananalysis of the policies affecting the marketing practices of Trump University and makerecommendations based on these policies if the FTC were to intervene. There have previouslybeen a number of complaints including a class action lawsuit and demands for a civilinvestigation by the Attorney General of Texas.
6
 
5
Baram, Marcus. "Trump's 'University' Accused Of Scamming Customers."
 Breaking News and Opinion on The Huffington Post 
. The Huffington Post, 6 July 2011. Web. 14 Dec. 2011.<http://www.huffingtonpost.com/2011/05/06/trump-university-scammed-customers_n_858587.html>.
6
Abbott, Greg. "Civil Investigation Demand."
 Big.assets.Huffingtonpost.com
. The Huffington Post, 6 Jan. 2010.Web. 14 Dec. 2011. <http://big.assets.huffingtonpost.com/TrumpUCID.pdf>.

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