Federal Prosecutors Step Up Probe of Land Deal Pushed by Wife of Bernie Sanders

A federal investigation into a land deal led by Jane Sanders, the wife and political adviser of Sen. Bernie Sanders, has accelerated in recent months – with prosecutors hauling off more than a dozen boxes of records from the Vermont college she once ran and calling a state official to testify before a grand jury, according to interviews and documents.

A half-dozen people said in interviews in recent days that they had been contacted by the FBI or federal prosecutors, and former college trustees told The Washington Post that lawyers representing Jane Sanders had interviewed them to learn what potential witnesses might tell the government.

The investigation centers on the 2010 land purchase that relocated Burlington College to a new campus on more than 32 acres along Lake Champlain. While lining up a $6.7 million loan and additional financing, Sanders told college trustees and lenders that the college had commitments for millions of dollars in donations that could be used to repay the loan, according to former trustees and state officials.

Trustees said they later discovered that many of the donors had not agreed to the amounts or timing of the donations listed on documents Jane Sanders provided to a state bonding agency and a bank. That led to her resignation in 2011 amid complaints from some trustees that she had provided inaccurate information, former college officials said.

The land deal, the officials said, became a financial albatross for the 160-student school, contributing to its closure last year.

The questions from government investigators, as described by those who were interviewed or received subpoenas for documents, suggest the investigation is focused on Jane Sanders and alleged bank fraud, and not on her husband. But the inquiry could nonetheless create a political liability for the senator, who was a candidate for the 2016 Democratic presidential nomination and is the progressive movement’s most popular leader.

A spokesman for the couple, Jeff Weaver, denied wrongdoing late last week. Weaver told The Post the couple hired a D.C. law firm this spring because they allege President Donald Trump’s Justice Department could use the investigation as a way to derail a potential 2020 challenge.

“While the Obama administration was in office, I don’t think anyone thought that these baseless allegations warranted hiring a lawyer,” Weaver said. “But with Trump and [Attorney General] Jeff Sessions at the helm, that’s a very different situation.”

The investigation began in early 2016 after Brady Toensing, a lawyer who was the state chairman for Donald Trump’s presidential campaign, wrote to the U.S. attorney and federal bank regulators, alleging potential bank fraud. FBI agents conducted interviews last year, but the probe was not publicly confirmed until this April, when the local news outlet VTDigger.org reported that a federal prosecutor had asked that records from the college be preserved.

Last week, an attorney for the Vermont Educational and Health Buildings Financing Agency, which helped the college get financing, told The Post that its executive director was asked to testify before a grand jury in April. That is the first public confirmation that prosecutors have sought to present evidence to a grand jury.

Paul J. Van de Graaf, chief of the criminal division in the U.S. attorney’s office in Vermont, cited an ongoing investigation in declining to comment on the case or on the claim that it is politically motivated. The Justice Department also declined to comment.