Federal prosecutors add additional charges against parents in college-admissions scandal | News | Palo Alto Online |


Federal prosecutors add additional charges against parents in college-admissions scandal

Two local defendants face bribery and other federal crimes under a grand jury indictment

Defendants who have not taken plea deals in the national college-admissions scam are facing new charges, including bribery conspiracy, which could put them behind bars for years.

A federal grand jury in the District of Massachusetts has indicted 11 parents, including two Bay Area residents with Midpeninsula ties, on additional charges in their cases, including conspiring to commit federal-program bribery, the U.S Attorney's Office in Boston announced Tuesday.

Two local parents, William McGlashan Jr., 55, formerly of Palo Alto, and Marci Palatella, 63, of Hillsborough, are among the parents now facing the bribery conspiracy charge, which carries up to 20 years in federal prison and a $250,000 fine.

The charge stems from alleged payments the 11 parents made to University of Southern California employees to aid their children's college admissions. In exchange for bribes, university employees allegedly designated the children to "favored" admissions categories, most notably as athletics recruits, although they didn't have the purported abilities in the sports listed on their applications, the U.S. Attorney's Office said.

Federal authorities previously arrested the parents on other charges in March as part of a 50-person indictment. In all, a grand jury indicted 33 parents for conspiring with William "Rick" Singer and others to bribe SAT and ACT exam administrators. The test supervisor secretly took the college-entrance exams for the children or corrected the children's answers after they had taken the exams, according to the complaint, which also names athletics coaches from elite universities as defendants.

Nine other parents facing the bribery-conspiracy charge including parent John Wilson of Lynnfield, Massachusetts, Hollywood actress Lori Loughlin and her husband, fashion designer Mossimo Giannulli.

McGlashan and Wilson face additional wire fraud and honest services wire fraud charges, according to the U.S. Attorney's Office. Wilson also faces an additional two counts of substantive federal-programs bribery for allegedly paying off Stanford University and other elite institutions to try to secure his children's admission. USC, Harvard and Stanford all received more than $10,000 annually in grants, subsidies or other forms of federal assistance, which justified the new charges against him, the U.S. Attorney's Office said.

Palatella allegedly wired $75,000 to The Key Worldwide Foundation, an organization Singer created to launder the bribes, for Florida resident Mark Riddell to proctor her son's SAT exam and to correct his answers in 2017. She ultimately paid $500,000 to have her son represented as a purported football recruit to USC. She allegedly paid $100,000 to Donna Heinel, USC's senior associate athletic director at the time, who allegedly presented the boy's application to the university's athletic admissions subcommittee and obtained approval to admit him as a recruit, according to court documents.

Prosecutors contend Palatella also agreed during a 2018 phone call with Singer to mislead the IRS if anyone inquired about her payments to the foundation, according to the indictment.

McGlashan allegedly paid Singer $50,000 through the foundation to arrange for Riddell to proctor his son's ACT exam at a West Hollywood test center. Riddell secretly corrected the answers without the boy's knowledge, according to the grand jury indictment. He also allegedly paid $250,000 to Singer to facilitate his son's admission as a football recruit to USC. They created a fake football player profile and used Photoshop to place the son's head onto the body of a kicker, according to the indictment.

Palatella and McGlashan pleaded not guilty to money laundering conspiracy and conspiracy to commit mail and wire fraud and honest services fraud in April. Arraignment dates on the new charges have not yet been scheduled.

If convicted, the parents could face long prison sentences and hefty fines. Conspiracy to commit mail and wire fraud and honest services mail, and wire fraud and wire fraud and honest services wire fraud (without conspiracy) each carry a maximum 20-year sentence in prison. Conspiracy to commit federal-programs bribery has a maximum sentence of five years in prison and federal-programs bribery (without conspiracy) carries up to 10 years in prison. All three charges include $250,000 in fines or twice the gross gain or loss, whichever is greater, and three years of supervised release.

Conspiracy to commit money laundering carries a maximum 20-year sentence, three years of supervised release and a $500,000 fine or twice the value of the property involved in the crime.

Tuesday's charges are the result of ongoing investigations in the nationwide college admissions case, Andrew Lelling, U.S. attorney for the District of Massachusetts, said in a separate statement.

"Our goal from the beginning has been to hold the defendants fully accountable for corrupting the college admissions process through cheating, bribery and fraud. The superseding indictments will further that effort."

On Tuesday, the U.S. Attorney's Office also announced additional charges against seven university athletic officials and others previously charged in the college-admissions scandal.

The parents and athletics staff, who have thus far pleaded not guilty to all charges against them, face additional charges not levied against others who pleaded guilty in their respective cases. Eight parents who admitted to conspiracy to commit mail fraud and honest services mail fraud charges received sentences ranging from no prison time to five months in incarceration.

Peter Jan Sartorio, 53, of Menlo Park, was sentenced on Oct. 11 to one year of probation and a $9,500 fine. Menlo Park resident Marjorie Klapper, 50, on Oct. 16 received a three-week prison sentence and one year of supervised release. Hollywood actress Felicity Huffman, 56, received a two-week sentence and a $30,000 fine (media reports indicate she began serving her sentence at the Federal Correctional Institution, a low-security facility in Dublin, on Oct. 15). All of their sentences include 250 hours of community service.

Former Stanford University head sailing coach John Vandemoer, 41, of Palo Alto, pleaded guilty on March 12 to conspiracy to commit racketeering after accepting $800,000 in bribes for athletics programs to place students on the sailing team. He was sentenced to one day of incarceration, which he already served prior to the court hearing; two years of supervised release, with the first six months to be served in home detention; and a $10,000 fine.

Manuel Henriquez, 55, the former CEO of venture capital and private equity firm Hercules Capital in Palo Alto, and his wife, Elizabeth Henriquez, 56, previously pleaded not guilty in April. They changed their pleas to guilty in Massachusetts federal court on Monday to one count each of conspiracy to commit mail and wire fraud and honest services mail and wire fraud and conspiracy to commit money laundering. Elizabeth Henriquez is due for sentencing on Feb. 7, and Manuel Henriquez's sentencing is scheduled for March 5. The prosecution's recommendation for sentencing has not yet been released as of Tuesday evening.

Davina Isackson, 55, Hillsborough, pleaded guilty on May 1 to conspiracy to commit mail fraud and honest services mail fraud. Her husband, Bruce Isackson, 61, pleaded guilty to commit mail fraud and honest services mail fraud, money laundering conspiracy and conspiracy to defraud the United States.

Prosecutors are recommending incarceration at the lower end of sentencing guidelines for Davina Isackson, plus one year of supervised probation, a $100,000 fine and restitution or forfeiture. Bruce Isackson faces recommendations of incarceration at the lower end of sentencing guidelines, one year of supervised probation, a $150,000 fine and restitution of $139,509 to the IRS and forfeiture. They are scheduled for sentencing on May 21.

Palo Alto residents Amy Colburn, 59, and Gregory Colburn, 61, are fighting charges of conspiracy to commit mail fraud and honest services mail fraud and money laundering conspiracy. They entered motions to dismiss their cases on April 15.


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Like this comment
Posted by Psychologist
a resident of another community
on Jan 17, 2020 at 12:12 pm

William Singer worked with psychologists known to him, according to the FBI affidavit, to have his client’s children “diagnosed” with learning disorders. That way, the client could request additional time on the SAT/ACT, thereby allowing Singer’s Procter, Mark Riddle, to take the tests instead and significantly raise the scores. This deeply concerns me, a licensed psychologist in the state of California, because it suggests that parents can “pay” for a diagnosis, a practice that is hard to investigate because of the confidentiality of all parties involved. Paying for a diagnosis is another way wealthy parents can grease the wheels on their child’s path to achievement.
I tried to approach the Board of Psychology in California about this and was told nothing could be done because there was no psychologist named specifically in the Varsity Blues case. This practice and the Varsity Blues case sheds a troubling light on my whole profession, and is not fair to those of us who do not participate in such unethical practices. I sincerely hope that the case opens up discussion about this facet of learning disability diagnosis.

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