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Admissions Money, Over The Table

University of Southern California (USC) seal.
photo by Ken Lund

It has emerged in court proceedings involving the ongoing college admissions scandal that institutions of higher learning – specifically, the University of Southern California – consider a family’s future prospects as a donor when deciding whether to accept their offspring as students.

There hasn’t been a more stunning piece of information since Captain Renault was informed that gambling was taking place at Rick’s Cafe in “Casablanca.”

An attorney filed internal USC staff emails as evidence on behalf of his clients, two of the parents facing charges in the admissions scandal that became public in March. The 18 documents include a color-coded spreadsheet identifying “special interest applicants.” Potential students were identified by how much money their parents were expected to donate, or had donated already, to the school.

Old-money universities like the members of the Ivy League and the Seven Sisters know how to be discreet about such considerations. Or maybe they just haven’t been subject to discovery in a criminal case in which defense lawyers seek to argue that wealthy parents could not have corrupted an admissions system that was already corrupt. I have serious doubts about whether that argument will work, but under the circumstances it seems like a reasonable courtroom strategy.

I am sure money plays a far greater role in college admissions than most university presidents and admissions officers are willing to admit publicly. Who knows what they say to their colleagues in private. My guess, however, is that most of them are too classy to put their thoughts about future hopes to siphon a family’s wealth in the same email thread as their comments about the substandard academic credentials of that family’s youthful applicant. (USC staff members mocked an applicant’s grammar but noted he was “good enough to shag balls for the tennis team,” The Wall Street Journal reported.)

USC is not a player in the old-money league. It is a big-time campus with many well-respected programs and some outstanding faculty and supporters. It also is known colloquially as the “University of Spoiled Children.” They don’t just hand out cute nicknames like that; you have to do something to earn them. If you are a fan of the TV series “Poldark” (we are talking about one of Hollywood’s go-to campuses, after all), you will understand what I mean when I say that if the crude, venal, financially successful but still social-climbing Warleggans decided to buy an American university, it might very well be USC.

For its part, USC has argued that the “special interest” tag alone does not guarantee admission for an applicant. Admissions dean Timothy Brunold said in a court declaration that in fact most special interest applicants do not get in, though the school does not track the exact percentage. The university allows many departments to mark an applicant with the special interest tag. But it stressed that no department officials could compel admissions decisions.

Frankly, any disclosures about money-grubbing admissions practices at USC would not concern me very much if I had a child who was considering applying. (In fact, I once did; I visited the campus with my older daughter before she ultimately decided to go elsewhere.) A handful of schools with enormous endowments might pooh-pooh financial considerations in admissions nowadays. They can do so because they were so successful at building their financial cushion, along with their reputations, in the past. At most colleges, though, finances are very much a consideration whether the colleges will admit this or not. If they are honest about it, they will acknowledge that getting some families to pay full sticker price, or much more, is how they can afford to build their programs and offer extensive financial aid that benefits most students of lesser means.

I would be much more concerned about the fact that the Los Angeles school is the focus of not one, but two sexual abuse scandals involving students who sought treatment at USC’s on-campus clinic. In the first, hundreds of women allege that George Tyndall sexually abused them. The school allowed the long-time head gynecologist at the university health center to retire in 2017 after an internal investigation. Tyndall was arrested in June on charges of sexually assaulting 16 women. The Los Angeles district attorney has said that more charges are likely due to the volume of claims. In a separate set of accusations, 48 men say that Tyndall’s former co-worker, Dennis Kelly, targeted gay and bisexual male patients for abuse during exams. In both cases, some of the accusers say they reported the misconduct to the school but saw no resulting action. As a parent, these are the sorts of allegations that would give me pause – much more so than the accusation that a school might consider potential future donations when making its admissions decisions.

Customers in Casablanca patronized Rick’s Cafe because they could fulfill their needs and desires there better than anywhere else that was available to them. When you get right down to it, students choose colleges for pretty much the same reasons. American campuses these days burn money at a prodigious rate, and that money has to come from someplace. Some donors open their checkbooks for purely altruistic motives. But others do not, and most schools cannot afford to be overly choosy about whose money they take.

So while the disclosures about USC’s admissions practices may be interesting, I would be shocked if anyone truly knowledgeable is shocked by them.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book, The High Achiever’s Guide To Wealth. His contributions include Chapter 1, “Anyone Can Achieve Wealth,” and Chapter 19, “Assisting Aging Parents.” Larry was also among the authors of the firm’s previous book Looking Ahead: Life, Family, Wealth and Business After 55.

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