“Tying incentive pay directly to gift income is uncommon.
The AFP Code of Ethics explicitly condemns this behavior as it promotes self-interested behavior by employees and is widely frowned upon by donors. Incentive pay is not used as a sales commission in any common model for a few reasons. The first is the same objection raised by the AFP about the ethical implications of personally being able to profit from a gift.
The second lies is the sheer logistics, team work behind, and complexity of most very large gifts, any one of which which could dramatically swing incentive compensation that would be based on income alone.”
As I’ve mentioned previously this is a complex matter. And not they eat most would imagine. Large gifts are major transactions.
From navigating fundraising.
There can be bonuses and team awards for annual goals it appears.
@bluebayou “If the donors took a tax deduction for the donation to Singer’s non-profit with the intent that they would receive special admissions treatment (aka, ‘guaranteed’), then that deduction is not allowable.”
As far as I can tell, we don’t know if the donors had the “intent” they were getting a guaranteed admission. It’s clear they were not getting guaranteed admissions since no admission is guaranteed but I suppose they could have been lied to by Singer that it was guaranteed even if it was not. It’s also possible the parents understood that it meant that the admissions was helped a lot, just like any big donor to a university would be.
Loughlin and her husband seemed to have been conned by Singer more than any other family. Singer had them convinced their kids could not be admitted to USC any other way even though - aside from their fake athletic resume – it appears that nothing else in their application was fake. They didn’t go to college and weren’t sophisticated about the process. The daughters appeared to be the “low-end” of admitted students (from an e-mail) but there is no evidence they cheated so their daughters could get higher SAT/ACT scores like the other parents. While people here find that irrelevant, I don’t. If Singer offered that and they turned it down and testify to it, that makes them different than the other families who pled guilty. They weren’t going to make an illegal “donation” to pay off a Harvard grad to take a test. But making a donation to the athletic department could have seemed “legal”. They knew they were faking her athletic resume but didn’t know faking an athletic resume on a college application was breaking the law. In fact, I don’t think it is since no one is trying to prosecute the Stanford fake sailor.
@OHMomof2 “The court docs should answer your question about who was charged with what, exactly.”
I know – I tried to look through all the pages. I don’t pretend my skimming was comprehensive, but it seemed as if the other parents being indicted who pled guilty all paid to have Singer hire someone to take or change their kid’s SAT/ACT exam. I could have missed something where the parent was indicted just for making a donation to Singer’s foundation that then went to the athletic department.
@observer12, you said about Laughlin and her husband “they didn’t go to college and weren’t sophisticated about the process.” Are you serious? I was a single mom that didn’t go to college but managed to assist my child through the UG and medschool process. Laughlin’s husband ran a huge clothing company but couldn’t figure out the college admissions process? Google is their friend. Sheesh, I’m sure they are hoping to have you or somebody like you on the jury. SMH.
Au contraire. Singer bragged to the Feds that his side door was ‘guaranteed’ – that was his selling point. Otherwise, folks would just donate $1m to 'SC and go thru the Development office, which is no guarantee.
@CottonTales that they were rich and successful in their fields doesn’t means they were sophisticated about colleges or even they cared enough to Google around. It is impossible to know but it looks as if they thought that throwing a lot of money at that issue would solve it. If you watch the Singer video where he was selling himself to host some sort of reality TV show you can see him talking about Uber rich parents that don’t want (or have time he maybe said…) to bother with the complexities of college applications much less with their kids and their ideas. That was the problem he supposedly solved as these rich parents would even fly him in their private jets across the country for him to intervene and come out a saviour.
In my book this (not caring and thinking that everything is solvable by money) is horrible parenting and maybe even borderline abuse. But being bad parents isn’t necessarily a crime. One has to wonder about what would have taken to boost admission by using the proper channels. Maybe throwing an annual gala for USC scholarship money by tapping into their fame plus donating some money on top would have had the same effect? I don’t know if that would have helped but what they did certainly reeks of ignorance which also very conveniently worked for Singer…
It is fun to speculate out loud but we will only know as the case progresses. As spectators that is a benefit of them pleading not guilty…
It’s allowable, but just not completely. The donor needs to subtract the value of the benefit received. Of course, good luck trying to figure what that value is.
@CottonTales “Laughlin’s husband ran a huge clothing company but couldn’t figure out the college admissions process?”
There are a lot of parents at private schools who spend a lot of money hiring “college consultants”. So I’m not sure why it would surprise you that one of those parents who hadn’t gone through the process themselves would listen to the consultant who came highly recommended by many rich and famous people. There are two kinds of “college admissions processes”. One is for middle class and poor applicants. The other is the one that many very wealthy parents use. There is an entire industry devoted to telling these parents (or their kids) what to do. It would not surprise me if many of them suggest that the parent make a very hefty donation, which is all legal.
@bluebayou "Singer bragged to the Feds that his side door was ‘guaranteed’.
Singer may have bragged that, but it wasn’t true. Remember the UCLA soccer player whose application first went to the wrong place at USC?
Were the UCLA soccer recruit’s parents charged? I can’t recall if it was just a donation in exchange for the recruit status or if there was also cheating on tests.
perhaps, but so what of his one? mistake? If someone makes a donation to a nonprofit with the purpose of receiving something in return, the tax deductibility of that donation is limited to the excess of the value received. Aunt Becky made a ‘donation’ for the purposes of admission. Her D got in. They believed him when Singer said admission was guaranteed. She and her husband received value…
What is the cost of that value? I’m trying to imagine the feds saying “the cost of getting a near-guaranteed admission preference to a high priced university normally requires a donation of at least $5 million dollars, so they received a value of $4.5 million”.
When you bid $750 at a school auction fundraiser to win a “meet the celebrity” opportunity, what is the value of that?
“Money laundering refers to a financial transaction scheme that aims to conceal the identity, source, and destination of illicitly-obtained money. The money laundering process can be broken down into three stages. First, the illegal activity that garners the money places it in the launderer’s hands. Second, the launderer passes the money through a complex scheme of transactions to obscure who initially received the money from the criminal enterprise. Third, the scheme returns the money to the launderer in an obscure and indirect way.” Sound familiar? https://www.law.cornell.edu/wex/money_laundering
Tax fraud is a form of money laundering, but just one if many actions that it can be.
Former development officer of a USNWR top 20 university here - it’s absolutely forbidden in the professional association code of ethics (as well as likely by implication according to most universities’ ethical policy framework) that development officers receive bonuses contingent on amounts raised. Full stop.
Yes, the UCLA parents are the Isacksons, and not only were they charged but they have pleaded guilty and are cooperating in nailing other parents and college coaches or officials who have not yet been charged:
Excerpt:
“Some of the biggest spenders in Singer’s scheme remain unidentified. One parent paid Singer $6.5 million, U.S. Attorney Andrew Lelling said at a news conference last month. Another, identified only as the father of “Yale Applicant 1,” spent $1.2 million to ensure his daughter was admitted to Yale as a recruited soccer player.”
"Some of the biggest spenders in Singer’s scheme remain unidentified. One parent paid Singer $6.5 million, U.S. Attorney Andrew Lelling said at a news conference last month. Another, identified only as the father of “Yale Applicant 1,” spent $1.2 million to ensure his daughter was admitted to Yale as a recruited soccer player.
Pressed by a judge about that father’s identity, Eric Rosen, Lelling’s lead prosecutor in the investigation, said: “There haven’t been charges publicly revealed about the family of Yale Applicant 1.”
I think it will be interesting to find out why the feds are prosecuting the people who donated $500,000 to Singer’s foundation and covering up for the people who paid $6.5 million and $1.2 million. Are those parents more politically connected?
It reminds me of the NCAA throwing the book at some young college athletes who sold their championship jersey or got free tattoos. But somehow just not ever being able to find anything wrong when the families of recruits at favored schools suddenly have a lot of expensive things.
It’s interesting that the USC Asst. Athletic Director hasn’t pled guilty yet. Maybe that money all went to the athletic department.