Private equity titan Bill McGlashan reaches settlement over role in "Varsity Blues" scheme
Bill McGlashan, the private equity titan arrested in 2019 for his alleged role in the "Varsity Blues" college admissions scheme, has reached a settlement with federal prosecutors. He also settled his dispute with his former partners at TPG Capital, Axios has learned from multiple sources.
Why it matters: This could set the stage for McGlashan's return to the spotlight. And before you say that's not happening, be sure to consult your Milken Institute Global Conference receipts.
The deal: McGlashan would plead guilty to a single charge of wire fraud, related having his son take the ACT test at a facility infiltrated by Rick Singer, the bribery scheme mastermind. In exchange, prosecutors would drop all other charges — including the one alleging bribery via the so-called "side door" for college admission.
- Per terms of the agreement, McGlashan would agree to serve a three-month prison sentence, pay a $250,000 fine, complete 250 hours of community service and be subjected to 24 months of probation.
- He also retains the right to limited appeal on the charge and, if successful would be allowed to rescind his guilty plea.
- This settlement still must be approved by a judge, who is under no obligation to do so. Expect that hearing to occur by the end of April.
The other deal: McGlashan and TPG, where he led both growth equity and impact investing, never seemed to agree on if he resigned or was fired. But there was consensus that TPG sought to deny McGlashan of all vested and unvested fund interests, which included stakes in such companies as Airbnb and Uber.
- It was a very contentious decision, as McGlashan was being denied compensation for investments made before the arrest.
- Axios has learned that the two sides quietly entered into a definitive separation agreement in the summer of 2019.
- A source tells Axios that the "economic consequences" to McGlashan remain identical to those described to fund limited partners (i.e., stripped of fund interests), although the source did not elaborate on other payments TPG may or may not have made.
The bottom line: This two-year saga looks to be nearing its conclusion.