Socialism, as they say, works until you run out of other people’s money. That appears to have happened to Jane Sanders, the wife of Vermont Socialist Senator Bernie Sanders.

The story is banal. A woman who has her job because of her husband’s clout finagles a credulous state agency into accepting bogus financial documents. Real estate is purchased. The fraud is discovered. The wife of the powerful man is paid a lot of money to leave. Everyone else is ruined.

This is the short version of the tale.

Jane Sanders was president of a small Burlington College. By small I mean that this year the college has 180 students.

Founded in 1972 in a person’s living room, the school has consistently had fewer than 300 students. Accordingly, for most of its history it has lacked much of a campus. The school also caters to a relatively niche market interested in programs such as its relatively rare study-abroad program in Cuba.

Back in 2010 a 32-acre lakeshore parcel convenient to the existing campus came on the market for $10 million. This piece of land became the centerpiece in Sanders’s scheme to increase enrollment at Burlington College from 200 students to 400 students. The problem: the college’s annual budget was $4 million. The solution: get other people to foot the bill.

In order to finance the purchase, Burlington College presented its case to the Vermont Educational and Health Buildings Finance Agency (VEHBFA), a state agency that issues tax-exempt state bonds for the benefit of non-profit institutions like schools or hospitals.

People’s Bank agreed to purchase the bonds, though in an analysis of the deal commissioned by VEHBFA, consulting firm PFM Group noted that, “The bank’s willingness to fund the loan is contingent upon … the minimum commitment of $2.27 million of grants and donations prior to closing.”

Sanders reported to the agency that Burlington College had raised $2.6 million with a commitment for an additional $1 million paid to the college over five years. Just one small problem:

But in fact, even the smaller figure supplied by Sanders appears to have been anything but “confirmed.” According to audits obtained by TheDCNF, the school listed $1,303,785 in short- and long-term commitments for the year ending June 30, 2011, the same year that the college received the financing.

Okay, maybe two small problems. That $1 million. It was actually a bequest, not a donation, and the bequestor has no yet joined the “great majority” so it is anything but certain. Why did the college get this loan? What happened to Sanders? Both those questions are neatly summed up in two sentences.

Vermont has a “D+” on their “Corruption Risk Report Card,” according to The State Integrity organization, a project of the Center for Public Integrity. The ranking, which puts the Green Mountain State 26th out of 50 states, includes an “F” for “ethics enforcement agencies.”

On Sep. 26, 2011, less than a year after orchestrating the property purchase and with two years remaining in her contract, Jane Sanders abruptly resigned as president of Burlington College.

For driving the college into near bankruptcy with a fraudulent loan application, Sanders received a severance bonus of $200,000.

Burlington College flirts with bankruptcy. It has sold off 25 of the 32 acres it purchased. Sanders’s successor hasn’t had much success in turning things around:

Two years into her presidency, Burlington College’s situation is much more serious. The school has failed to meet the enrollment and fundraising goals Plunkett and Sanders set four years ago when the school bought a new $10 million campus.

And the school has been plagued by financial problems. Recently, Burlington College failed to deposit payments to employees’ retirement funds, used restricted scholarship money to pay for operating costs and an outside audit questioned whether the college can continue to operate.

Many faculty members say Plunkett has sacrificed the school’s mission in favor of a plan to sell half the campus to a real estate developer. Staff say Plunkett creates a toxic work environment. Students say they don’t think the school can survive with her as president.

…

During her tenure, the administration has monitored emails to the board of trustees and threatened employees who speak to the media, sources said. In two years, 11 of the 14 people she hired when she started have quit, as well as others who started before or after Plunkett transitioned from finance director to president in 2012.

But all’s well that ends well. Jane Sanders is $200,000 richer. Bernie Sanders still rails on and on about income inequality and oligarchs and golden parachutes. That’s how socialism works.