One of Silicon Valley’s most prominent private equity investors — and one of the tech sector’s leading proponents of how to invest ethically and for social impact — has been charged in an explosive college admissions scandal that was revealed Tuesday, March 12.
Prosecutors charged Bill McGlashan, a founder and managing partner at TPG Growth — which has made landmark investments in companies like Uber and Airbnb — on fraud allegations for trying to engineer the admission of his son to the University of Southern California.
What is particularly damaging for TPG is that McGlashan has positioned himself as a leading voice in Silicon Valley for social responsibility. In addition to overseeing TPG’s late-stage growth investing arm, McGlashan has partnered with other conscious leaders like Bono and Laurene Powell Jobs at The Rise Fund, a TPG investing arm that tries to make the world a better place through investments in things like dairy farms in India.
McGlashan was one of dozens of people — including actors Lori Loughlin and Felicity Huffman, as well as prominent business executives, lawyers, college coaches and others — who were charged Tuesday in what prosecutors allege is a massive college bribery scheme that lasted years and raked in millions of dollars for those who took part.
So what did this man, who positioned himself as a leading voice in Silicon Valley for social responsibility, do to be ensnared in Operation Varsity Blues?
Shorthand: He is charged with participating in two of the schemes identified in the operation. One allegedly set up a way for his son to get phony college admissions test scores. The other allegedly involved bribing a University of Southern California athletics official to have McGlashan’s son admitted as a recruited football player, even though his high school didn’t have a football team and he wasn’t an athlete. McGlashan did note that his son has “strong legs,” according to the complaint.
Longhand: To understand how the schemes all worked, read the following pages from the federal criminal complaint that pertain to McGlashan.
They refer to someone identified as “CW-1,” described as a cooperating witness who founded and operated, with others, a for-profit college counseling and preparation business known as “The Key,” formally The Edge College & Career Network LLC. CW-1 has pleaded guilty in U.S. District Court to racketeering conspiracy, money laundering conspiracy, conspiracy to defraud the United States and obstruction of justice. CW-1 has been identified as William “Rick” Singer, whom you can read about here.
According to the complaint, Singer’s clients paid between $15,000 and $75,000 per standardized test to participate in the cheating scheme, with payments usually structured as “purported donations” to a charity he set up called the Key Worldwide Foundation, or KWF.