Here are the high-flying financiers charged in the college-admissions cheating scandal

turtix/ShutterstockStanford University appeared in the college-admissions scheme.
  • The Department of Justice on Tuesday charged 50 people with participating in a scheme to get students into colleges by cheating on entrance exams or bribing athletic coaches.
  • The parents charged include Hollywood stars, as well as executives at prominent companies, venture-capital firms, and law offices.

The Department of Justice on Tuesday unsealed documents charging dozens of people with participating in a nationwide college-admissions scam.

Among those parents indicted by the FBI are high-flying executives, wealthy real-estate developers, and Hollywood stars. A slew of financiers was also named in the case, including former Pimco CEO Douglas Hodge, Hercules Capital CEO Manuel A. Henriquez, and William McGlashan, a TPG managing partner.


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Hollywood actresses and business leaders are accused of paying to get their kids into elite colleges by cheating on exams and faking athletic skills. Here’s how investigators say the scheme worked

High-ranking schools such as Georgetown University, Stanford University, Yale University, the University of Texas at Austin, the University of Southern California, Wake Forest University, and the University of California, Los Angeles, also appeared in the indictment, court documents show. Federal prosecutors said the systematic scheme of bribery lasted more than eight years, from 2011 to 2019.

There were a number of finance executives charged. Business Insider has reached out to all of them for comment and will update this story if we hear back.


Robert Flaxman, cofounder of Crown Realty and Development

Robert Flaxman cofounded the Costa Mesa, California-headquartered real-estate-development company Crown Realty and Development in 1994. The firm has been an active local developer in California, investing in a number of notable local projects, such as the retail center Venice Crossroads and a hotel, restaurant, office complex across from Angel Stadium of Anaheim.

Crown Realty and Development has a more than 2.3 million-square-foot portfolio that includes retail, hospitality, and industrial projects that spread across California, Arizona, Virginia, Idaho, and Northern California.

He is accused of participating in “both the college recruitment scheme and college entrance exam scheme.” In the court records, he is also accused of fabricating information on his son’s application to the University of San Diego.

He was charged with “conspiracy to commit mail fraud and honest services mail fraud.”


Manuel A. Henriquez, founder and chairman of Hercules Capital

LinkedInManuel A. Henriquez.

Manuel A. Henriquez is the cofounder, chairman, and CEO of Hercules Technology Growth Capital, a Palo Alto, California-based venture-debt provider. The company was an early investor in Facebook.

According to his LinkedIn profile, Henriquez has worked in venture capital for more than 30 years. Before Hercules, he was a partner at the private-equity fund VantagePoint Venture Partners. He was also the founder of ON Technology, a software company that was backed by investors such as Kleiner Perkins, Apple Computer, and more.

He and his wife, Elizabeth Henriquez, are accused of participating “in the college entrance exam cheating scheme, on four separate occasions, for their two daughters.”

They are also accused of conspiring “to bribe Gordon Ernst, the head tennis coach at Georgetown University, to designate their older daughter as a tennis recruit in order to facilitate her admission to Georgetown,” according to court documents.

The couple are charged with “conspiracy to commit mail fraud and honest services mail fraud,” according to court documents.


Douglas Hodge, former CEO of Pimco

PIMCO

Douglas Hodge is the former CEO of the asset manager Pimco. Hodge took the reins of the notable bond manager after Bill Gross, the onetime “Bond King,” exited the firm in 2014. In December 2017, Hodge announced that he would retire from the firm.

During his 28 years with Pimco, Hodge grew the assets the company managed from $US15 billion to $US1.69 trillion. Afterward, he joined Sway Ventures as a venture partner to help grow the firm’s early-stage portfolio companies.

According to court documents unsealed on March 12, Hodge “agreed to use bribery to facilitate the admission of two of his children to USC as purported athletic recruits, and sought to enlist CW-1 to secure the admission of a third child to college through bribery as well.”

He was charged with “conspiracy to commit mail fraud and honest services mail fraud.”

Pimco declined to comment on the matter.


Bruce Isackson, president of WP Investments

LinkedInBruce Isackson.

Bruce Isackson is a cofounder of WP Investments, a California real-estate firm.

He graduated from UCLA in 1980, and he then joined the commercial-real-estate firm Cushman and Wakefield, where he specialised in leasing and selling industrial properties.

He and his wife, Davina Isackson, “took part in both the college recruitment scheme and the college entrance exam cheating scheme,” according to court documents. The couple are charged with agreeing to “use bribery to secure their older daughter’s admission to college as a recruited athlete.”


William McGlashan

Bill McGlashan runs the alternative-asset giant TPG’s growth fund, and he is also the CEO of the Rise Fund, a social-impact investment platform managed by TPG Growth.

He holds an MBA from Stanford Graduate School of Business and a bachelor’s degree with honours from Yale University.

McGlashan is accused of having discussions with an unnamed individual who participated in the scheme, dubbed “CW-1” in the indictment. CW-1 created “a fake football profile using Photoshop software” so that McGlashan’s son could be enlisted as a “purported football recruit,” according to court documents.

TPG said in a statement after the charges were announced:

“As a result of the charges of personal misconduct against Bill McGlashan, we have placed Mr. McGlashan on indefinite administrative leave effective immediately. Jim Coulter, Co-CEO of TPG, will be interim managing partner of TPG Growth and The Rise Fund. Mr. Coulter will, in partnership with the organisation’s executive team, lead all investment work for both going forward.”


John B. Wilson, CEO of Hyannis Port Capital

LinkedInJohn B Wilson.

John B. Wilson is the president and CEO of Hyannis Port Capital, a consulting and private-equity firm investing in micro-cap private companies.

Previously, he has held various senior executive positions at a slew of big-name corporations, such as Staples, Gap, General Motors, ExxonMobil, and Northwest Airlines. He also had a four-year stint at the management-consulting firm Bain and Company, serving as a vice president and partner.

“Wilson conspired to bribe Jovan Vavic, the USC water polo coach, to designate his son as a purported recruit to the USC men’s water polo team, thereby facilitating his admission to USC,” according to court documents. He also “sought to use bribes to obtain the admission of his two daughters to Stanford University and Harvard University as recruited athletes,” according to the documents.

He was charged with “conspiracy to commit mail fraud and honest services mail fraud” in the Southern District Court of Texas.


Robert Zangrillo, founder and CEO of Dragon Global

LinkedIn

Robert Zangrillo is the founder and CEO of Dragon Global Management, a private investment firm focusing on venture capital and real-estate investments. The Miami, Florida-headquartered company has managed investments that exceed $US1 billion through its predecessor and existing funds, according to its website.

A veteran venture capitalist, Zangrillo has a track record of investing in a number of fast-growing companies, including Didi Chuxing, Facebook, Jet.com, Twitter, and Uber Technologies. He is also one of the three investors developing the Magic City Innovation District project, which aims to revitalize Miami’s Little Haiti and Little River neighbourhoods.

Zangrillo was charged with conspiracy to commit mail fraud and honest services mail fraud.

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