Bernie Sanders and his wife Jane have lawyered up in the midst of a federal investigation involving a loan that led to the bankruptcy of the college where she was president.
Federal investigators are examining a $10 million deal to buy 33 acres on the shore of Lake Champlain set up by Jane Sanders when she led now-defunct Burlington College in 2010.
The complex deal involved a $6.5 million issuance of tax-exempt bonds by Vermont’s Educational and Health Buildings Finance Agency. People’s United Bank loaned Burlington College $6.5 million to buy the bonds. The Catholic church, which sold the land, loaned the school $3.65 million in a second mortgage.
To secure the loans, Jane Sanders claimed to the bank and the church that the college had raised enough money to pay off the debt, reports say. Sanders cited $5 million in likely pledges and $2.4 million in confirmed fundraising in her requests to the bank, reports said.
The probe centers around whether Sanders distorted the donor levels in the bank application. Prosecutors may also be looking into allegations that the senator’s office inappropriately urged the bank to approve the loan, according to Politico.
When the college shut down in 2016, the property deal and its debt was cited as a cause.
The Justice Department is handling the investigation, which will be pursued at the discretion of a U.S. attorney for Vermont that President Trump has yet to appoint.