Donald Trump and key family members including daughter Ivanka have ties to Deutsche Bank, which has been fine for laundering Russian money (Photo Collage: MPG)
The scandal presents a huge conflict of interest for the president and puts huge pressure on incoming Attorney General Jeff Sessions, a close Trump ally.
Deutsche Bank, one of Germany’s largest banks, loaned Trump, family members and/or The Trump Organization more than $300 million. The loans were made at a time when no other United States bank would lend him money following four major bankruptcies.
In addition, the bank sued Trump in 2008 after the mogul stiffed the bank for $40 million on a $640 million real estate loan. In a move characteristic of Trump’s long-standing shady business practices, he counter-sued.
The real estate mogul claimed Deutsche Bank had contributed to the global recession, causing property prices to plummet. As a result, the bank, he claimed, owed him $3 billion in damages.
The bank’s lawyers blasted Trump’s lawsuit, but it apparently had its intended effect. The parties settled the suits out of court two years later.
Under normal circumstances, the legal battle would have ended the bank’s business relationship with Trump.
But Deutsche Bank’s private banking arm, which caters to clients with assets in an excess of $50 million, extended four large mortgages to the Trump Organization, according to Bloomberg.
Rosemary Vrablic, who had previously worked as Trump’s personal banker at Citigroup and Bank of America before moving to Deutsche bank’a private wealth division in 2006, reportedly negotiated the loans.
The loans are guaranteed by Trump’s lease on his new deluxe hotel in Washington DC’s Old Post Office building, his Chicago hotel tower and the Trump National Doral Miami resort, according to the business site.
Trump is in danger of losing his lease on the government-owned Old Post Office building because of a law that prohibits elected officials from profiting from government-owed property.
So far, however, the General Services Administration (GSA), which manages federal property, has not taken steps to revoke the lease as required by law.
According to European papers, where the story is getting major play, Ivanka Trump, her husband, Jared Kushner, who serves as a White House adviser, and Kushner’s mother, Seryl Stadtmauer, all have accounts at the German bank.
Deutsche Bank reportedly is trying to determine whether any of Trump’s loans are connected in some way with Russia, according to London’s Guardian newspaper.
The bank launched its internal review, after Trump announced his presidential campaign, to comply with regulations that require closer scrutiny of clients with potential government ties.
So far, the internal review has found no direct links, but the bank is under pressure to hire an independent, outside auditor to review its business relationship with President Trump, the newspaper reported.
The outside examination would come on top of an on-going U.S. Justice Department investigation and a British investigation that have uncovered evidence the bank was laundering money for Russian oligarchs.
“We know that Deutsche Bank is a major lender to President Trump, and the firm is also currently undergoing scrutiny by the Department of Justice for alleged misconduct,” said Rep. Bill Pascrell Jr, a member of the House Ways and Means committee.
“I think it’s important for the American people to know the extent of the bank’s involvement with the president, and whether there is any Russian involvement in loans made to Mr Trump,” he told The Guardian.
Pascrell is urging Congress to examine Trump’s tax returns in closed session for any Russian connection.
Last month, the New York Department of Financial Services fined Deutsche Bank $425 million for laundering at least $10 billion of Russian money through its Moscow branch.
The UK’s Financial Conduct Authority also imposed a £163 million pound fine, its largest ever.
In a separate action, the Justice department fined Deutsche Bank $7.2 billion for misrepresenting residential mortgage-backed securities, a move that contributed to the 2007-2008 financial meltdown.