Donald Trump has been sued by New York Attorney General Eric Schneiderman over claim that the real estate mogul operated a fraudulent online education "university," swindling students out of $40 million, Bloomberg reported.

Schneiderman claims that Trump University operated as an unlicensed educational institution, which misled students who hoped they would gain real estate investing acumen, the petition provided by Schneiderman read.

Students paid as much as $35,000 for the programs, which stated the experts were "handpicked" by Trump when in fact they were not, nor did the have real-estate backgrounds. Some even recently sought bankruptcy because of their own real estate investing failures, Schneiderman charged.

"Mr. Trump used his celebrity status and personally appeared in commercials making false promises to convince people to spend tens of thousands of dollars they couldn't afford for lessons they never got," Schneiderman said in a statement over the weekend.

Trump organization spokesman Amanda Miller blasted the charges leveled against her boss, pointing to www.98percentapproval.com, which reportedly shows that "98 percent of Trump University students rated the program 'excellent' while only 4 percent of New York State registered voters rated Attorney General Eric Schneiderman's performance as 'excellent'."

"Schneiderman thinks he could be the next governor? He must be joking," she added.

Trump also personally chided Schneiderman calling the attorney general as "a political hack looking to get publicity." The mogul has held several TV interviews in the past few days to further contest the lawsuit as his attorney Michael Cohen said Saturday that Schneiderman was upset Trump did not give him more campaign contributions to him.

"He thought I would settle the lawsuit," Trump said. "I didn't want to settle the lawsuit on principal."