01:32 - Source: CNN
Sanders on FBI land deal probe: It's pathetic

Story highlights

A Vermont Republican accused Jane Sanders of bank fraud

The accusation is related to a loan she helped Burlington College get while president of the school

CNN —  

Sen. Bernie Sanders on Sunday denied an allegation that his office might have pressured a Vermont bank to speed up the loan process for a real estate acquisition his wife Jane orchestrated for Burlington College while president of the school.

“Absolutely not,” Sanders said in an interview with CNN’s Jake Tapper on “State of the Union.” “And in fact, let’s be clear. Five years, five years after my wife left Burlington College — and she left it in better shape than it had even been in — five years after, guess what happened? Right in the middle of my presidential campaign — and I know this will shock the viewers — the vice chairman of the Vermont Republican Party, who happened to be Donald Trump’s campaign manager, raised this issue and initiated this investigation.”

Sanders was referring to Vermont lawyer Brady Toensing, a vice chair of the state’s Republican Party and former state chairman for the Trump campaign, who leveled accusations last year that the senator might have improperly pressured the bank to speed up the loan process.

Sanders’ remarks on Sunday come amid reports the FBI might be looking into the land deal. Toensing has called for a federal investigation of Jane Sanders, who was president of the now-defunct college from 2004-2011, alleging she committed loan fraud by exaggerating school’s fundraising commitments to pay off the loan.

Peter Fitzgerald, the chief division counsel and media coordinator for the FBI’s office in Albany, New York, said in a statement the office provided to CNN on Sunday: “It is DOJ policy not to confirm or deny the existence of an investigation.”

The US attorney’s office in Vermont has previously declined to comment on the issue, and the Justice Department has not yet responded to a previous CNN request for comment.

In a bid to raise the small school’s profile and attract more students., Burlington College took out loans to purchase 33 acres from the Roman Catholic Diocese of Burlington for a new campus on the shores of Lake Champlain. The small liberal arts college borrowed more than a combined $10 million from a bank and the church itself, according to documents obtained by CNN.

CNN reviewed the loan application for the deal, which was signed by Jane Sanders and stated that the college would take in millions of dollars worth of pledged donations, many of which never materialized.

The college announced its closure a year ago because of the debt it had taken on from the real estate deal.

In making his allegations against Bernie Sanders, Toensing cited a May 2016 conversation with an anonymous source, since identified as Vermont House Minority Leader Don Turner.

Turner, a Republican, recently disputed Toensing’s characterization of their May 2016 conversation and called into question Toensing’s allegations. In an interview published by the Vermont alt-weekly Seven Days on Friday, Tuner described Toensing’s allegation as “hearsay.”

Turner confirmed to the alt-weekly that the subject of the loan came up at a lunch with three bankers, including an executive from People’s United Bank, which issued one of the loans. But he denied they disclosed firsthand knowledge of the loan or Sanders’ possible involvement.

“They said that they were aware or had heard that Bernie’s office had helped get that loan — and that was it,” Turner said, according to the article. “It was just a hearsay, general conversation.”

Turner also told Seven Days that he could not remember the date of the lunch or the identity of the banker who suggested Sanders had acted improperly, except to say that the person was not involved with the college loan and wasn’t claiming to have firsthand knowledge, the alt-weekly reported.

“I have never said I had any knowledge or evidence or anything,” he said, according to the article.

Sanders appeared to reference the alt-weekly’s interview with Turner in his remarks on “State of the Union” on Sunday.

“I should also mention to you that, just the other day, the person (Turner) who had allegedly had made this statement — that I had been involved in this land deal – refuted that, he said I never said that,” Sanders told Tapper. “That was in a paper in Vermont. So you know, I think what you’re looking at is something that the Republican National Committee is very excited about. My wife is perhaps the most honest person I know.”

Sanders slammed the accusation on Sunday, calling it a “pathetic” moment “where parties not only attack public officials, they have to go after wives and children” – echoing remarks he made last week.

Toensing told CNN last week that his hope “is for a fair, full and impartial investigation.”

Sanders’ former campaign manager, Jeff Weaver, confirmed to CNN last week that the Sanders recently hired lawyers amid reports of a potential federal investigation related to the land deal.

Weaver said Jane Sanders has hired lawyer Larry Robbins to represent her in the possible probe, adding that the FBI had not contacted either Jane or Bernie Sanders in connection to any such investigation. A person close to the senator said Sanders was represented by Rich Cassidy, a longtime lawyer for the family.

Yves Bradley, the chair of the Burlington College Board of Trustees, told CNN last week that he was informed of an FBI investigation by the college’s dean of operations over a year ago and that he believed the investigation’s focus to be the college’s disastrous land deal. Bradley said Burlington College had been subpoenaed as part of that investigation.

Eli Watkins, Elizabeth Landers and Will Cadigan contributed to this report