25-Aug-20 Privilege

How do we decide when the actions of the privileged are harmful? When do they also become criminal?

On Friday 21 August 2020, US actress Lori Loughlin was handed a two-month jail sentence, fine and community service for her part in a college admissions scandal. Around 50 individuals have been charged following Operation Varsity Blues, including over 30 parents and a number of sports coaches and college administrators in the United States. At the centre of the operation, college admissions counsellor Ricky Singer was paid over $25m by his clients to arrange entrance for their children into the most prestigious schools. The fraud is thought to date back to 2008.

There were two routes in: either a college administrator was paid to correct SATS (admissions test) papers to ensure candidates got the requisite score or coaches were bribed to label applicants as recruited athletes. In Lori Loughlin’s case, for example, she and her husband paid $500,000 in bribes to have their two daughters admitted into the University of Southern California (USC) as fake rowing-team recruits. Elite schools including Georgetown, Stanford and Yale were targeted.

The former head of Pacific Investment Management Company (Pimco), Douglas Hodge, paid nearly $1m in bribes to get three of his children into top US colleges. He was in the process of securing access for a fourth child. His sentence was reduced given his history of philanthropy to children’s causes globally (around $30m in total, it was alleged by his defence team). The BBC reported that:

A tearful Hodge said in a prepared apology following the sentencing that “ego” or “status” did not drive his decision. “Rather, I was driven by my own transformative educational experiences and my deep parental love.”

It is not clear how transformational education at an Ivy League university can be when your parents are multi-millionaires. Intellectually yes, but the earnings potential and social networks are already a given.

Parents from all backgrounds will go to many lengths for their children’s health, happiness and success. This is natural. And privileged children in the US, when faced with the option of relying only on their own ability and graft to secure a college place, or to use their parents’ legacy connections to inch ahead, for example, may well take the latter path. Many will recognise and nurture their good fortune with grace and hard work.

However, it is ironic that affirmative action for Black, Asian and Hispanic, or other under-represented or deprived young people, is considered by some as favouritism or unequal, yet the use of wealth or alumni ties (which, at this point in history, is often connected to White privilege), is not considered a helping hand. It is normalised and therefore invisibilised.

We might think of the applicants who over the years failed to secure a place at their chosen institution, not because they did not have the academic or athletic achievement, but because their space was bought. These are the indirect and unknown victims.

In Operation Varsity Blues, the bribery was overt and criminalised. Yet many young people have secured university places through their wealth and connections. Current US President Donald Trump got into private college Wharton in Pennsylvania in part, it is alleged, because his brother Fred was childhood friends with the then admissions officer, James A. Nolan. It is said that Fred asked James to help the application through.  In those days too, the successful application rate was far higher – 40% – compared to a more competitive 7% now.

Michael Cohen, Trump’s personal attorney from 2006-2018, wrote to Trump’s high school and colleges threatening them with legal action if they released any details about his academic performance. While Trump claims to have got the highest marks possible at Wharton, no record of such achievements can be found in the 1968 class archive.

Closer to home, UK Prime Minister Boris Johnson’s recent appointments to the House of Lords make interesting reading. Private Eye (No 1528, p.14) reports that peerages were given to:

• His own brother, Jo Johnson
• Two former colleagues from his days as London Mayor – Ed Lister and Daniel Moylan
• Former Tory MP James Wharton, who managed Boris’ successful leadership campaign in 2019
• Fundraisers and donors Aamer Sarfraz and Michael Spencer; the latter, according to Eye, has donated £4.6m to the Conservative party either individually or through his companies over the years
• Evgeny Lebedev, who owns the London Evening Standard and whom, the Eye says, allows Boris to holiday in his Palazzo Terranova near Perugia, in Italy

The Honours (Prevention of Abuses) Act 1925 was introduced after a cash for honours scandal involving the then Prime Minister David Lloyd George. Maundy Gregory, who brokered Lloyd George’s honours, is the only person ever to be convicted under the 1925 Act.

In 2006, several individuals were nominated for life peerages by Prime Minister Tony Blair but were rejected by the House of Lords Appointments Commission. It turned out that they had loaned significant amounts of money to the Labour Party, potentially exploiting a loophole in electoral law, which required the public declaration of donations to political parties, but not loaning money at commercial rates of interest. An investigation ensued, involving arrests and police questioning of a number of Labour grandees, but no charges were brought.

In 2015, researchers at the University of Oxford found a positive correlation between party political funding and peerage nominations over the period 2005-2014. They argue that the undue influence of large donors on the political process deepens public mistrust in politicians and undermines democracy.

What is the line between paying for a peerage or being awarded a peerage following significant political donations? What is the line between your parents financially bribing college admissions and your parents drawing on their legacy connections or on family and friendship networks and donating capital funds to the college, to smooth the admissions path? Both have similar motives and outcome. But while straight corruption is criminalised, nepotism and leveraging wealth tend to be ‘regulated’ by institutions themselves, sometimes rather loosely.

It is not clear that we need more criminal law. Rather, institutions need to be far more transparent around financing, publish more data, and ensure that processes (such as college admissions or honours nominations) are robustly scrutinised by professional teams or independent bodies, who are themselves subject to regular corruption audits.

We should also examine the purpose and values of our institutions. In the UK, what is the role (if any?) of the second chamber and how should it be constituted? Should membership of the second chamber be a political reward or should it be a role reserved for our brightest and best? In the US, how has the marketisation and commercialisation of higher education impacted the sector and student intake, for good and for ill? How do universities ensure that they attract both income and those with the greatest intellectual and social potential?

Privilege should not always be castigated: we do not choose our birth. Privilege is relative and may be earned. Entitlement is the issue. Entitlement practices may not be criminal, but are socially corrosive. They suggest that money and ties should grant access: “I pay, therefore I can”.

© Natasha Mulvihill and Criminology Tales, 2020.