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College admissions scandal mystery solved? Chinese family allegedly paid $6.5 million

The student's parents, who have not been charged, were allegedly connected to the scheme's ringleader by an employee at Morgan Stanley.
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The family of a Chinese student allegedly paid $6.5 million to the ringleader of the college admissions scandal to get their daughter into Stanford University, a person with direct knowledge of the matter told NBC News.

The parents of the student, identified as Yusi Zhao, have not been charged. They were referred to the scam's ringleader, William Rick Singer, by an employee at Morgan Stanley, the source said.

The $6.5 million payment stood out in the federal indictment unsealed last month that outlined a sprawling network of wealthy parents, including actresses Felicity Huffman and Lori Loughlin, who paid Singer large sums to boost their children's chances of getting into top universities such as Yale, Georgetown and Stanford.

The second highest figure listed in the indictment was $1.2 million, paid by the family of a young woman who got into Yale University. Most of the defendants paid Singer less than $250,000.

Neither Zhao nor her parents, whose alleged connection to the $6.5 million payment was first reported by The Los Angeles Times, could be reached.

Zhao's parents reached Singer through a referral by a Morgan Stanley financial adviser, Michael Wu, according to a person familiar with the matter. Wu was fired in March, the person said.

A Morgan Stanley spokesperson said Wu was terminated for "not cooperating with an internal investigation into the college admissions matter."

"We are cooperating with the authorities," the spokesperson added.

Wu's lawyer, Raymond Aghaian, said Singer duped the Morgan Stanley adviser by telling him the money would go toward Stanford University "staff salaries and scholarships" and "fund athletics special programs and the university's underserved outreach programs."

"Singer made such statements as he knew Mr. Wu would not engage in wrongdoing," said Aghaian, who added that his client was fired while out he was out of the country and trying to cooperate with Morgan Stanley.

Spokeswomen for the U.S. attorney’s office in Boston, which is prosecuting the case, and the FBI declined to comment.

Zhao was admitted to Stanford in the spring of 2017 after Singer pushed her to the school as a competitive sailor despite there being no indication she competed in the sport, the Times reported.

In a statement Wednesday, Stanford University acknowledged that a student's admission was rescinded last month but declined to identify the person citing federal privacy laws. A profile of Zhao on the school's website has been taken down.

"It's important to clarify that Stanford did not receive $6.5 million from Singer, or from a student's family working with Singer," the university said in the statement. "Stanford was not aware of this reported $6.5 million payment from the family to Singer until today’s news reports."

Image: William "Rick" Singer leaves the federal courthouse in Boston
William Rick Singer leaves federal court in Boston last month after being charged in a nationwide college admissions cheating scheme.Brian Snyder / Reuters

The revelation of the seven-figure payment's alleged source comes as federal investigators continue to aggressively investigate the case, two senior law enforcement officials say, with future indictments possible, if not likely.

Earlier Wednesday, a California couple pleaded guilty in federal court in Boston. Bruce Isackson and Davina Isackson admitted to paying Singer $600,000 to get their daughters into the University of California, Los Angeles and the University of Southern California. The Isacksons are cooperating with investigators, according to a statement from Boston federal prosecutors.

Singer pulled off the scheme by bribing college athletic coaches and administrators to falsely make his clients' children look like star athletes to improve their chances of getting into the coveted schools, federal prosecutors say. Singer also hired ringers to take admissions tests for the students and, in some cases, paid off test proctors to correct their scores.

Singer pleaded guilty last month and has been cooperating with investigators. Fourteen other parents, including Huffman, also agreed to plead guilty in the scheme last month.

The investigation involved more than 200 federal agents who fanned out across six states.