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Should One Parent’s $10,000 Bribe Bring Same Penalty as a $10 Million One?

Should One Parent’s $10,000 Bribe Bring Same Penalty as a $10 Million One?

(Bloomberg) -- The judge preparing to sentence the parents who pleaded guilty in the U.S. college admissions scandal said she may factor in the size of the bribes they paid.

“It may be the easiest and the fairest, and we may end up there,” U.S. District Judge Indira Talwani said at a hearing on Tuesday in Boston.

Talwani set up the high-stakes session, bumping a couple of sentencings that had been scheduled, to weigh the Justice Department’s argument that the colleges and testing companies caught up in the scandal suffered financial harm. The government says the 15 parents who struck plea agreements should be sentenced based on that harm.

That argument, and prosecutors’ insistence on prison time, has the U.S. at odds, in some instances, with its own Probation and Pretrial Services office.

The office, which recommends sentences based on federal guidelines, has concluded that the colleges and test makers didn’t suffer any loss and that therefore each of the parents should face zero to six months in prison, regardless of the sums they paid, according to the government.

The probation office’s conclusion “means that a defendant who pays a $10 million bribe will have the same offense level as a defendant who pays a $10,000 bribe,” the U.S. says.

The court needed a seating chart to handle all of the defense attorneys for wealthy parents in the case who attended the hearing. Most were seated in the jury box, transforming it into a high-priced panel of men in suits. Offered a chance to speak, none of the defense attorneys took the judge up on it.

Under questioning by Talwani, Assistant U.S. Attorney Eric Rosen conceded that “it’s clearly impossible” to tailor the amount of the victims’ losses to each parent and suggested that the judge could instead use the sums of the bribes themselves as “foreseeable consequences” of the parents’ crimes. She said she might well do that.

But Rosen bridled when the judge suggested looking at the question differently.

“It seems to me the guidelines are saying what did this defendant gain,” the judge said.

“I would absolutely disagree,” Rosen responded. “It’s not a gain to the defendant personally. It’s gain from the entire offense, so we have to look at the other people involved in the case -- the co-conspirators.”

Defense attorneys for jewelry maker Marjorie Klapper and Los Angeles sales-outsourcing executive Stephen Semprevivo, who both pleaded guilty, filed memos in court this week accusing prosecutors of trying to boost parents’ punishments long after plea negotiations had closed. Klapper paid $15,000 into the scam, and Semprevivo $400,000, according to the government.

Klapper’s lawyer called the government’s latest calculations of potential losses to testing companies and colleges, such as a decline in applications, “outlandish” and “speculative.” The government now cites “tens of millions in losses” while Klapper’s plea included losses of no more than $15,000, her lawyer told the court.

Semprevivo’s defense team accused the government of slipping in Georgetown University’s costs for investigations of former head tennis coach Gordon Ernst that predated the federal probe. The university suspended Ernst in 2017 and fired him in 2018.

The actor Felicity Huffman, one of the most prominent parents in the scandal, will be the first one sentenced, on Friday. She paid a $15,000 fee to have her daughter’s SAT score illicitly boosted, according to prosecutors. Rosen told the judge on Tuesday that the government wouldn’t seek restitution from Huffman.

Rosen kicked off the hearing by praising a probation officer, seated in the jury box, he has worked with over the years.

“Her work is exemplary,” he told the court. He acknowledged the conflict between the U.S. attorney’s office in Massachusetts, which brought the case, and the federal probation office.

“I realize some sharp elbows have been thrown in the proceedings, but I just want her to know ... and the rest to know, we certainly appreciate the hard work they put in here,” he said. “We come in peace, Your Honor.”

The government has charged 34 parents in the scandal. As it laid out the scheme in March when it revealed the charges, a Newport Beach, California, college admissions strategist named William “Rick” Singer took thousands of dollars from affluent clients to fix their children’s entrance exam scores.

Upping the ante, the government says, Singer funneled through a charity he’d set up hundreds of thousands of dollars in bribes for college athletic coaches to put the kids on recruiting rosters, assuring them of places in elite schools across the country, from the University of Southern California to Yale University.

The charge of fraud conspiracy to which the 15 parents have pleaded guilty carries a maximum term of 20 years in prison, though the federal guidelines can bring that number down significantly for parents who acknowledge their crime, have a clean record and meet other criteria.

That leaves 19 parents who chose not to seek plea deals, were indicted on money-laundering charges and are fighting it out. Singer, who has admitted to leading the sprawling operation out of his once legitimate college-counseling firm, The Key, pleaded guilty to racketeering and is cooperating in the prosecution.

The case is U.S. v. Abbott, 19-cr-10117, U.S. District Court, District of Massachusetts (Boston).

--With assistance from Patricia Hurtado.

To contact the reporter on this story: Janelle Lawrence in New York at jlawrence62@bloomberg.net

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Peter Jeffrey, Steve Stroth

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