When Donald Trump borrowed $69 million from Deutsche Bank for his Chicago tower in 2014, he signed a private guarantee confirming, among other things, that he had never been charged with any crime and was not under investigation for fraud. Those things are truer.
The Manhattan district attorney on Tuesday unveiled 34 charges against the former president. Trump, who has pleaded not guilty, faces investigations in Georgia, New York and Florida. He also faces accusations, initiated in a civil action through New York’s attorney general. , which defrauded money establishments for years. All of this adds up to a bad resume for someone whose business is based on borrowing money.
“When I was at the bank, no one had the time of day with an allegation hanging over their head,” said one of Trump’s former lenders. “I mean, I couldn’t have even gotten a hearing. “
But not all financiers think that way. ” If an asset has cash flow and can be borrowed, regardless of what happened to it, there are lenders who will lend it,” says Rob Horowitz, who helped link Trump and Deutsche Bank years ago. , explaining that the hedging budget or insurance corporations would step in even if banks have become capricious. “You’ll pay a slightly higher interest rate, but that’s all it means. “
Some lenders have already expressed reservations about doing business with Trump. In October 2020, Deutsche Bank reached out to the president’s son, Don Jr. , with questions about net statements the Trump organization had provided, according to legal documents. The bank followed up in diciembre. de that year, noting that the submission of false or misleading documents constituted an occasion for non-compliance. A lawyer for the Trump Organization, Alan Garten, said he expects to have an answer in the coming days. But he never provided any.
Deutsche has to sever ties, according to the attorney general’s lawsuit. This procedure appears to be ongoing. Although Trump paid $170 million in debt to Deutsche Bank when he sold his D. C. hotel. last year and refinanced another $125 million compared to its Miami golf hotel around the same time, it still appears to owe Chicago about $45 million in a loan due in 2024.
The Trump International Hotel And Tower is among the buildings in Chicago on March 23, 2013. (Photo via Raymond Boyd/Michael Ochs Archives/Getty Images)
Luckily for Trump, he found a new lender willing to accept as true with him, Axos Bank. A small San Diego institution, Axos linked up with the Trump Organization through a loan brokerage firm, then refinanced $100 million instead of Trump Tower and $125 million opposite the Miami complex. During the discussion of a guarantee for the Trump Tower loan, the factor of net worth statements was raised, according to court documents. This was a sensitive issue, given that the Trump organization’s representations to previous lenders had generated a massive fraud lawsuit. Should the Trump Organization, after all, start presenting valid estimates to its lenders?
Not necessarily. According to court records, the Trump organization has proposed an alternative, which would allow it to simply hand over a list of physical assets and liabilities and let Axos do its own calculation. The Trump organization has also tried to restrain Don Jr. s responsibility as trustee of his father’s fortune. An Axos lawyer agreed with the general concept of exonerating Don Jr. but sought to ensure that the younger Trump remained guilty of possible fraud. That seemed like the least Axos could hope for, given that the Trump organization already faces a burglar’s indictment for tax fraud.
Asked about all this, a spokesman for the bank declined to go into the main points of the negotiations, focusing instead on the calculations of the agreements. “The independent valuation price of each of the assets far exceeds the corresponding loan amount,” it said in a statement. “And the cash flow generated through the operations of each of the assets far exceeds the debt service needed to fully repay the corresponding loan. “
In addition to Axos, the Trump organization still has some of its legacy lenders. For example, the former president owes $126 million of the $160 million he borrowed against 40 Wall Street in 2015. In this case, the loan agreement specifies that Trump’s company will have to inform its creditor, Ladder Capital, of government proceedings that may harm the agreement.
Ladder’s other insiders are probably already aware of Trump’s legal troubles, assuming they’ve turned on the TV or read a newspaper in recent weeks. It’s still unclear how the lender reacts to the news. Representatives for the company, which helped finance two other Trump loans opposed to smaller Manhattan properties, did not respond to a request for comment.
Trump also accepted an $8 million guarantee that he borrowed in lieu of a property in Bedford, New York. When Trump signed that agreement in 2000, he showed he faced no lawsuit for $10,000 or more that wasn’t covered by insurance. York’s attorney general is now seeking to extract at least $250 million from the former president as part of the fraud trial. Since then, the establishment that issued the Bedford loan has undergone several mergers. A representative for its new parent company, WSFS Bank, declined to comment. .
President Trump’s Seven Springs estate in New York, seen here on September 30, 2020. (Johnny Milano for The Washington Post Getty Images)
While Trump was in office, he borrowed $11. 2 million from Professional Bank for a Palm Beach mansion he bought from his sister. Supervisors of Trump. No’s fortune is clear if this arrangement included provisions for fraud charges. Bank officials did not respond to requests for comment.
He recently reworked piles of millions of dollars in debt, refinanced some of his loans and paid off others. He also sold his hotel in Washington, D. C. for approximately $375 million. All deals left him with about $425 million in cash, a sum that can come in handy if the loan is too expensive.