A Scandal Subplot: The Strange Case Of The German Bank & American Tycoon
As Russia scandal subplots goes, they don’t come stranger than the relationship between Deutsche Bank and Donald Trump, a long-term love affair that has now caught the attention of Special Counsel Robert Mueller.
The German-owned bank was fined $600 million by U.S. and British regulators 10 days after Trump’s inauguration for laundering billions of dollars from 2010 to 2014 in a scheme known as the “Global Laundromat” run by Russian criminals with ties Trump’s favorite authoritarian, Vladimir Putin.
The money — some six thousand transactions in all — flowed from Deutsche Bank in Moscow to Deutsche Bank in London and then on to Deutsche Bank in New York, where it was invested in Manhattan real estate.
Long story short (kind of), this is what we know:
* By 1998, Trump had worn out his welcome with American lending institutions because of a string of bankruptcies, and his credit and financial outlook were so bad that no one would lend him a cent.
* Trump turned to Deutsche Bank’s real estate division and secured over $4 billion in loans and bond offerings, including a $640 million loan in 2005 to fund construction of a Trump hotel in Chicago.
* Trump defaulted on repayment of the $640 million following the global financial crash, and in 2008 Deutsche Bank filed for a summary judgment, seeking an immediate $40 million.
* Trump countersued for $3 billion, stating that he had no intention of repaying because the global financial crisis was a “once-in-a-century credit tsunami” co-created by Deutsche Bank.
* A judge threw out Trump’s countersuit, but Deutsche Bank did not sever ties and its personal wealth division gave Trump another $25 to $50 million in credit on his personal guarantee.
* More remarkably, Trump then began borrowing even larger sums, taking out two mortgages against his Trump National Doral resort in Miami and a $170 million loan to finish his Washington hotel.
* By the time Trump became president, he owed Deutsche Bank about $300 million, due in 2023 and 2024, in addition to the still outstanding Chicago hotel loan.
* Trump son-in-law Jared Kushner and his mother have an unsecured $25 million line of credit with Deutsche Bank and his family business got a $285 million loan from the bank.
* Former Deutsche Bank chairman Josef Ackerman is now chairman of Bank of Cyprus, an offshore haven for dirty Russian money, while its vice president was Trump commerce secretary Wilbur Ross.
* Indicted Trump campaign manager Paul Manafort was a favored Bank of Cyprus account holder and deposited $2.7 million in payments he received as a consultant for Ukraine’s former pro-Russian ruling party.
* Among the Russian connections Trump has denied having is Dennis Rybolovlev, an oligarch who is a major Bank of Cyprus shareholder and purchased one of Trump’s estates.
* In May, federal prosecutors settled for pennies on the dollar with Prevezon Holdings, a Russian-owned Cyprus company accused of laundering dirty money through Manhattan real estate.
* One of Prevezon’s lawyers was Natalia Veselnitskaya, who had met with Donald Trump Jr. in June 2016 in a follow-up to his infamous “If it’s what you say I love it” email response to an offer to get “dirt” on Hillary Clinton.
* In addition to her claims of being a private attorney, Veselnitskaya has an intelligence background, was hard-wired to Putin and before meeting Donald Jr. had discussed the “dirt” with Russia’s prosecutor general.
As early as 1984, Trump began tapping into what would become an extensive network of contacts with corrupt businessmen, mobsters and money launderers from the former Soviet Union, Russia and their satellite states to make deals ranging from real-estate sales to beauty pageants sponsorships to bailing out his frequently ailing enterprises.
There no firm evidence — yet — that Trump properties were beneficiaries of the Deutsche Bank pass-through, yet the question again is begged: If it’s all about the money — and Mueller has subpoenaed Deutsche Bank financial records in following the money — is Trump’s refusal to acknowledge his Russia ties and continued insistence that the scandal is a “hoax” merely a reflection of the frightening fantasy world in which he dwells?
Or is it a consequence of members of that network being able to leverage Trump’s literal and figurative debts to them — if not blackmail him outright, which Christopher Steele’s dossier suggests?
An ironic footnote: When Trump’s German grandfather, Friedrich Trump, migrated to the U.S., he opened a barber shop at 60 Wall Street in Lower Manhattan. Today a 50-story skyscraper stands at that address. It is the American headquarters of Deutsche Bank.