Payments from parent were loans, ex-coach’s wife says in bribery case
The wife of former Harvard University fencing coach Peter Brand testified Thursday at his federal bribery trial that the father of two fencing recruits paid the couple’s outstanding debts of $500,000 as part of an unwritten loan agreement.
The father, Jie “Jack” Zhao, also unwittingly paid hundreds of thousands of dollars more for their Needham home than it was worth, she said.
Jacqueline Phillips told jurors that Zhao, a wealthy Maryland businessman, had become close friends with her husband and wanted to help them on their “next chapter together as empty-nesters,” as they were looking to sell their Needham home and move to Cambridge.
Zhao offered to loan them money with the understanding that they would repay it after Brand received an inheritance upon his mother’s death, Phillips said. Between 2015 and 2017, he made direct payments to companies on their behalf — paying off their mortgage, utilities, student loans for their son, a new car loan, and a down payment and renovation costs for a condominium in Cambridge, according to records presented in court.
It was a “gentlemen’s agreement,” said Phillips, adding that Zhao set no limit on how much he would pay to settle their debts and no timeline for repaying it. But the debt was repaid in full with interest, she said. The defense showed jurors one check from Brand to Zhao for $486,613 dated December 2021, and another one for $18,914 in October of this year.
“Did you only pay that because your husband was indicted?” Brand’s attorney, Douglas Brooks, asked.
“No,” Phillips said. “We had to wait for my mother-in-law to pass
away to receive the inheritance.”
During cross-examination, Assistant US Attorney Stephen Frank grilled Phillips about why there was no documentation to prove the payments were loans, and why she and her husband failed to disclose that debt on a loan application form when applying for a mortgage to buy their condominium in Cambridge.
“I should have paid more attention,” said Phillips, adding that it was a mistake not to include the loans from Zhao.
She acknowledged that she used a $175,000 settlement she received from the city of Cambridge in 2018 to buy a house in New York, rather than repaying Zhao. She said she and her husband were waiting for the inheritance from her mother-in-law, who died last year.
“Like a lot of couples we lived paycheck to paycheck,” Phillips said.
Brand, 69, of Cambridge, and Zhao, 63, each face one count of bribery and one count of conspiracy to commit bribery concerning programs receiving federal funds and honest services wire fraud — essentially an allegation that Harvard was defrauded and deprived of Brand’s honest services.
Prosecutors allege Zhao made payments to Brand in exchange for the coach’s promise to help his sons get accepted to Harvard in 2014 and 2017 as fencing recruits.
Defense lawyers said in opening statements that Zhao’s sons were outstanding athletes and students who fenced at Harvard for four years and graduated with honors.
A 2019 Globe article exposing Zhao’s purchase of Brand’s Needham home at the same time his younger son was being recruited by the coach triggered the federal investigation that led to their indictments two years ago.
Brand was fired from Harvard in 2019 for violating its conflict-of-interest policy.
Zhao purchased Brand’s Needham home in 2016 for $989,500, which was more than $440,000 above its assessed value. He sold it 17 months later for a $324,500 loss and never lived there, according to testimony.
On Thursday, Phillips testified that Zhao offered to purchase the home without an appraisal or inspection.
“He was wonderful, very flexible,” Phillips said. She said she told him she believed the home was worth $1 million because it was appraised at $640,000 in 2005 and she assumed it had appreciated over time.
Phillips told jurors she was “just shocked” when she discovered after the sale that a realtor told Zhao that the house was in need of repairs and was worth hundreds of thousands of dollars less than he paid for it.
“I was very sorry that he lost money on that house,” said Phillips, adding that she apologized to Zhao last week at the courthouse.
During cross-examination, Phillips was grilled about how she couldn’t have known the value of the home, given she worked for years as a mortgage consultant.
Phillips testified that Zhao never lived in the house and let her family stay there for $1,000 rent while they waited for their new Cambridge condominium to be renovated.
She acknowledged that she and her husband sold the contents of the Needham house — including used furniture, gardening tools, and a treadmill — to Zhao for $50,000.
Later, Phillips said Zhao asked them to clear the home so he could sell it, prompting her to rent two dumpsters and dispose of those items.