Executive gave tip that launched admissions bribery case
By ALANNA DURKIN RICHER
Friday, March 15
BOSTON (AP) — The biggest school admissions scandal ever prosecuted began with a tip from an executive investigators were targeting in a securities fraud probe, a law enforcement official said Thursday.
The executive told Boston authorities chasing down the market manipulation scheme that the women’s soccer coach at Yale University said he would label the executive’s daughter as a recruit in exchange for cash, the official said. The official was not authorized to discuss the case and spoke on the condition of anonymity.
Investigators recorded a meeting between the executive and the coach at a Boston hotel room in April 2018. During the meeting, which is described in court documents, authorities say Rudy Meredith told the father he would help his daughter get into Yale in exchange for $450,000. Meredith accepted $2,000 in cash in the hotel room and gave the executive directions about how to wire the rest of the money, authorities say.
Meredith began cooperating with the investigation that same month in the hopes of getting a lesser sentence, prosecutors say in court documents. Meredith, who resigned from Yale in November, has agreed to plead guilty to charges including wire fraud. A message was left Thursday on Meredith’s phone.
The Wall Street Journal first reported the source of the tip. Authorities have not publicly identified the executive.
At least nine athletic coaches and 33 parents, many of them prominent in law, finance, fashion, the food and beverage industry and other fields, have been charged in the case. They include Hollywood stars Felicity Huffman and Lori Loughlin.
Prosecutors said that parents paid an admissions consultant to bribe coaches and administrators to falsely make their children look like star athletes to boost their chances of getting accepted. Some parents spent hundreds of thousands of dollars, as much as $6.5 million, to guarantee their children’s admission, officials said.
The consultant also hired ringers to take college entrance exams for students, and paid off insiders at testing centers to correct students’ answers, authorities say.
Massachusetts U.S. Attorney Andrew Lelling has said that the investigation is continuing and that authorities believe other parents were involved. The IRS is also investigating, since some parents allegedly disguised the bribes as charitable donations.
The consultant, William “Rick” Singer, pleaded guilty to fraud and conspiracy charges in federal court Tuesday in Boston. Singer’s attorney told reporters that he plans to cooperate fully with prosecutors.
On Wednesday, two college students filed a lawsuit against the University of Southern California, Yale and other colleges, saying they were denied a fair opportunity for admission because the alleged scheme gave coveted spots to “unqualified students.”
Follow Alanna Durkin Richer at http://www.twitter.com/aedurkinricher
Why a college admissions racket would funnel bribes through a fake charity
March 15, 2019
Sarah Webber, Associate Professor, Department of Accounting, University of Dayton
Deborah Archambeault, Associate Professor, University of Dayton
Disclosure statement: The authors do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.
Partners: University Of Dayton provides funding as a member of The Conversation US.
Federal authorities are prosecuting dozens of suspects in the biggest college admissions scandal ever exposed. The joint FBI and IRS investigation, dubbed “Operation Varsity Blues,” uncovered millions of dollars in bribe money wealthy parents are accused of paying to sneak unqualified children into Stanford, Yale and other elite universities on the pretext that they were star athletes with high standardized test scores.
William “Rick” Singer has pled guilty to committing fraud as the head of a college counseling and preparation business and a sham charity, acting as the ringmaster of the entire web of wrongdoing. He is cooperating with the authorities. Among the many interesting details to emerge have to do with how Singer’s company allegedly funneled much of the US$25 million his clients paid in unusually high fees for guidance counselor services through the nonprofit Key Worldwide Foundation, possibly to deflect attention.
We are accounting scholars who research nonprofit fraud. Our data indicate that outright fake charities like this one seem to be less commonly detected than other kinds of nonprofit fraud, such as when real charities get swindled through embezzlement schemes by rogue bookkeepers and the like. Our research also sheds light on why Singer and his dozens of accomplices allegedly got away with their scheme for years.
Sources of scrutiny
There are federal and state authorities whose job it is to catch and prosecute fraudulent charities and fake donations. The Internal Revenue Service’s Tax Exempt Government Entities division is in charge of granting nonprofit status through reviews of tax exempt status applications. This division also monitors compliance with tax filings requirements and audits of nonprofits.
But as nonprofit scholars like Dennis Neely have noted, state attorneys general are at the forefront of monitoring nonprofit activities. However, state budgets for nonprofit oversight and enforcement are too low to effectively monitor all charities within their jurisdictions.
Most states have fewer than three full-time employees working on charitable oversight. This leaves only a few hundred people in the country to oversee some 1.5 million nonprofits, despite the fact that these organizations make up 10 percent of our nation’s workforce.
In addition, these systems are set up to catch tax cheats and bring in missing tax revenues. We see a lack of resources dedicated to monitoring the revenue flowing into and out of nonprofits, possibly because the fact that they don’t owe any income tax makes them a lower priority.
Another factor is the presumption that do-good organizations are not going to get swept up in criminal activity like bribery and money laundering. Likewise, regulators may presume that accountants will heed their professional duties if they suspect their clients are breaking laws. However, accountants are more likely to quit to avoid signing off on fraudulent paperwork than blow the whistle.
This scandal makes us wonder whether the authorities are reading all the paperwork most tax-exempt groups are required by law to file with the IRS, known as 990 forms. Key Worldwide Foundation’s mission statement, which appears in these tax filings, itself is suspect.
Despite an allusion to providing “education that would normally be unattainable to underprivileged students,” it does not say that the students it helps face economic hardship. Instead, the organization emphasizes how Key Worldwide’s “contributions to major athletic university programs may help to provide placement to students that may not have access under normal channels.”
Even so, what’s the rationale for a charitable foundation to contribute to major athletic programs to enable students regardless of their means to pay for school to enter college if they are eligible for sports scholarships?
IRS documents indicate that supposed donations to Singer’s foundation grew eight-fold from less than half a million dollars in 2013 to nearly $4 million in 2016 as Singer’s alleged scheme used money parents pretended to be donating to the charity to pay off coaches, testing proctors and other people.
Key Worldwide’s tax filings also suggest that none of the foundation’s top staff earned money for their work, which is unusual for a charity that big. Gordon Ernst, the only compensated individual listed in its publicly available tax forms is one of the suspects charged with racketeering for allegedly receiving $2.7 million in bribes labeled as consulting fees while coaching the Georgetown University tennis team.
The foundation’s tax filings state that it has no records proving that it gave away the grants listed in its paperwork. Nor did the charity say whether it tried to prove that it had determined its grantees’ eligibility by checking a box on its forms. Purported grantees, such as the Bay Area nonprofit Friends of Cambodia, are coming forward to deny they got any money.
However, we can’t rule out that some grants could have been real and intended to throw off suspicions.
It remains to be seen how this scandal will change oversight and regulations at the federal and state level as well as at every step in the college admissions process.
Any clients who were eligible to take advantage of the charitable deduction could have defrayed some of the fees they paid Singer to bribe coaches and testing personnel through a tax break subsidized by the federal government. While it is clear that the foundation broke the law if it used donations for personal gain and not for a charitable purpose, we do not yet know whether the government will treat all donations to the foundation as tax evasion or not or what penalties are in store.
The National Collegiate Athletic Association, a nonprofit that regulates college sports, monitors athletic programs carefully. The NCAA constantly looks out for bribery, performance-enhancing drug abuse and ineligible athletes, among other violations.
It has already opened investigations into the coaches charged in this scandal. In our view, the NCAA should go further by reviewing its own systems and safeguards to ensure that nothing like this is happening elsewhere and never happens again.
Some universities are beginning to take action too. The University of Southern California, for example, has revoked its acceptance of all future students it suspects benefited from Singer’s services. Universities should also be carefully reviewing their own liability and identifying ways to monitor and prevent admissions fraud rather than just declaring that they are the victims of a crime.
One first step is to closely evaluate any grants they may have received from Key Worldwide, the fake charity. According to tax returns it filed with the IRS, the foundation said it gave the University of Southern California water polo team $100,000 in 2014 and Chapman University $150,000 in 2016, among other major grants. Many if not most of these outlays could be as fake as the charity itself allegedly was.
But we believe that universities would be wise to proactively scour their records to find out if they have this money in their coffers before any new pay-to-play charges are lodged against them.
Elsa Patricio de Barros, logged in via LinkedIn: What does all this mean for the (cheating) students who have successfully graduated from those universities AND for those universities? They were not good enough to enter on their own but once there they grew a brain? Or the teachers were all bribed as well? Or does all this means what is more likely, that most of those universities are highly inflated and actually provide a piece of paper more than a real education?
Softer, processed foods changed the way ancient humans spoke
March 14, 2019
Steven Moran, Postdoctoral researcher, Department of Comparative Linguistics, University of Zürich
Balthasar Bickel, Professor of General Linguistics, University of Zürich
Disclosure statement: Balthasar Bickel receives funding from the Swiss National Science Foundation. Steven Moran does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
The human capacity for language divides our species from the rest of the animal kingdom. Language has not only allowed us to conquer all corners of the globe, but to devise writing, mathematics and all things thereafter.
But researchers can find many of language’s basic design features in the communication systems of other animals. For example, many animals have particular calls for specific objects and meanings, and some even seem to combine calls in meaningful, albeit rudimentary ways. These lines of continuity, however thin, drive home the point that, at its essence, language is part of our biology.
Our new research suggests that a biological perspective is indeed necessary to resolve why languages have the range of sounds they have. We draw on evidence from paleoanthropology, speech biomechanics, ethnography and historical linguistics to suggest that new speech sounds emerged in our ancient ancestors as their jaws and teeth evolved to deal with new kinds of diets.
Biology and language
To study the origins of language and understand how it evolved into the remarkable faculty that we have today, it makes sense to investigate language from a perspective that includes biology as well as culture. But language doesn’t figure into the typical biology curriculum. It’s mostly considered a purely intellectual and cultural phenomenon, grouped together with literature and art as part of the humanities.
But this categorization is peculiar because, like the communication systems of other animals, language is simply part of our nature. We process it with the neural wiring in our brains, and we produce it with our bodies: mostly with our mouths, but in the case of sign languages, also with our hands and other gestures.
Language is also often seen as a fixed skill – it arose with the emergence of our species and has been stable in its basic design since its origin.
This traditional view is part of what researchers call the uniformitarian assumption in linguistics and anthropology. The assumption is that languages today are the same – in terms of their types and distributions of linguistic structures – as they were in the past.
Food and language
Our research group’s work directly challenges this uniformitarian assumption. We believe the range of available speech sounds used in human language has not remained stable since its origin. Our research shows that labiodental sounds – such as “f” and “v,” which are made by raising the bottom lip to the upper teeth – began to arise only after the transition to agriculture, between 10,000 and 4,000 years ago (depending on the world region).
While labiodentals are rather common today and appear in roughly half of the world’s languages, we show that in the case of Indo-European languages, they’ve been innovated mainly since the Bronze Age.
Why? What caused this sudden emergence of a new class of speech sounds?
To understand the relevant processes, we need to quickly dive into some biological anthropology. All primates start with an overbite and overjet bite configuration – colloquially a scissors bite – both with their baby teeth and their permanent teeth. Then a traditional diet of tough foods naturally develops the scissors bite of a young individual into an edge-to-edge bite by adulthood.
The invention of food processing technologies – like milling and fermentation – that gained steam with the development of agriculture allowed people to move toward a softer diet. And those softer foods meant people retained the scissors bite well into adulthood. For example, the archaeological evidence shows adult skulls with the scissors bite as early as 4,300 years ago in what is today Pakistan.
This rather recent change in the human bite paved the way for labiodentals to be incorporated into spoken languages. This process gradually began to appear in geographic areas including Europe and South Asia where there was increased access to softer foods through food processing technologies.
But these new sounds didn’t emerge everywhere: Retention of the overbite and overjet only facilitates the ease of producing labiodentals and increases the probability for producing them accidentally – it does not mandate it. So across diverse regions, societies and cultures, many groups slowly developed a new class of speech sounds, but others did not.
Ideas to chew on
A biological perspective on language evolution allows us to ask exciting new research questions, like how did the current diversity of speech sounds develop over evolutionary time?
At present, there are over 2,000 different speech sounds that play a role in the world’s roughly 7,000 or so spoken languages. These speech sounds range from the omnipresent cardinal vowels (i, a and u) found in most languages to the rare click consonants found in a handful of languages spoken in southern Africa. Why is there such immense diversity in the sounds of the world’s languages?
Recent research suggests that the basic anatomical conditions for speech were in place long before the emergence of Homo sapiens. According to those results, it was chiefly a matter of neural development that allowed the sophisticated motor control that human beings now have over their speech organ. But our new findings now hint that researchers might have underestimated the importance of fine anatomical details: While the basics may have been set, some sounds may be older than others in the hominin and primate lineage, simply because of anatomical conditions and independent of motor control.
We believe that our discovery opens a new chapter in the quest for the origins of humanity’s most distinctive faculty, language, a quest that has been called the hardest problem in science.
EU shows united front on Brexit, loss of confidence in May
By LORNE COOK and SAMUEL PETREQUIN
Friday, March 22
BRUSSELS (AP) — European Union leaders took back control of the Brexit process from British Prime Minister Theresa May, saying Friday they believe the risks were too great and that action was needed to protect the smooth running of the world’s biggest trading bloc.
May’s mantra since the Brexit referendum in 2016 has always been about “taking back control” of U.K. affairs from the EU. But leaders from the bloc showed at a Brussels summit that they too have a big say in how Brexit ends up, as the political tussle resumes in the British Parliament over how to proceed.
In a move that underlined their loss of confidence in May as she battles for her political survival, the leaders set two deadlines for Britain to leave or to take an entirely new path in considering its EU future.
At marathon late night talks in Brussels, they rejected May’s request to extend the Brexit deadline from March 29 — just one week away — until June 30.
Instead, the leaders agreed to extend the date until May 22, on the eve of EU elections, if she can persuade the British parliament to endorse the Brexit deal. Failing that, May would have until April 12 to choose a new path.
“British politicians are incapable of implementing what the people asked them,” French President Emmanuel Macron told reporters. “This crisis is British. In no way must we (the EU) become stuck in this situation, so that is why we have given two deadlines. We are organized.”
The aim of the EU move is to ensure that Britain doesn’t take part in the May 23-26 elections if it is leaving. Candidates for the Europe-wide polls, being held amid deep concern that mainstream parties could lose seats to anti-immigrant groups and populists, must be enrolled by April 12.
“The U.K. government will still have a choice of a deal, no-deal, a long extension or revoking Article 50. The 12th of April is a key date,” said EU Council President Donald Tusk, who chaired the summit.
The leaders seized hold of the Brexit process when May — after repeated questioning — proved unwilling, or perhaps unable, to tell them what she planned to do next week if she fails yet again to convince a skeptical British Parliament to endorse the deal, EU officials said.
“We have to move forward. Our citizens, our companies have to be able to understand what the choice of the British Parliament is. We hope that it will be a rational choice, that it will be a choice to maintain close economic and security links with the European Union,” Belgian Prime Minister Charles Michel said Friday.
“We are now waiting for the British to say clearly to the European Union what they want for the future,” he told reporters.
The legally-binding Brexit agreement May sealed with her EU partners last November has been twice rejected by British legislators, once by a historic margin, and she has already angered the legislators by suggesting they are responsible the impasse.
“If Parliament does not agree a deal next week, the EU Council will extend Article 50 until 12 April,” May said, referring to the EU treaty article governing Brexit. “At this point we would either leave with no deal, or put forward an alternative plan.”
May also moved to heal the wounds caused by her televised speech to the public Wednesday evening — which some legislators slammed as “toxic” and a “low blow,” saying that she had “expressed my frustration. I know that MPs are frustrated too. They have difficult jobs to do.”
“I hope we can all agree, we are now at the moment of decision,” May said.
The Brexit battle now shifts back to Britain’s Parliament. Pro-EU lawmakers said the bloc’s decision showed that May needed to change course and consider alternatives to her rejected deal. They plan an attempt next week to force a change of direction by setting out a series of votes in Parliament on alternatives, including a plan to keep close economic ties with the EU.
“We need to open up this process because we have rejected her deal, we’ve rejected no-deal, the EU has decided to give us a little more time and we’ve really got to get on with it,” said Labour Party lawmaker Hilary Benn, who chairs the House of Commons Brexit committee.
“This won’t work if the prime minister is not prepared to move an inch,” he said. “I’m afraid that’s the story of the last two and three-quarter years.”
Raf Casert and Jill Lawless in Brussels, and Danica Kirka in London, contributed to this report.
Follow AP’s full coverage of Brexit at: https://www.apnews.com/Brexit