For someone invested like Donald Trump, a blind trust would not and could not work if he was president. Therefore, putting his wealth in the trust of his kids running it would be like putting a Rolex in a lock box and pretending it is not there. Every decision he would make as president could have financial implications every single day he was president. It is like the kids guarding the cookie jar. So, if you were invested the way Trump is you would want to be president too because you might double or triple your real wealth while you were president just by appointments and decisions you make along the way and how you influence people. Since he cannot put his wealth in a blind trust he should not allowed to become president because of extreme conflict of interest. This is a very very serious legal issue and I don't know how it is going to be resolved. Because to leave it the way it is would be literally getting a kid to guard the cookie jar and paying him a quarter and when you came back he would tell you, "Some kid came in an beat me up and ate all the cookies. Aren't I a good guard?" Would you believe him?
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Trump Tower on Fifth Avenue in Manhattan. An investigation into the real estate holdings of ...begin quote from:
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Trump's empire: A maze of debts and opaque ties | The Seattle Times
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4 hours ago - A New York Times investigation into the financial maze of Donald Trump's U.S. real estate holdings reveals that companies he owns have at ...
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In Maze of Trump's Empire, Unknown Ties and $650 Million in Debt
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Daily Kos
On the campaign trail, Donald J. Trump,
the Republican presidential nominee, has sold himself as a businessman
who has made billions of dollars and is beholden to no one.
But
an investigation by The New York Times into the financial maze of Mr.
Trump’s real estate holdings in the United States reveals that companies
he owns have at least $650 million in debt — twice the amount than can
be gleaned from public filings he has made as part of his bid for the
White House. The Times’s inquiry also found that Mr. Trump’s fortunes
depend deeply on a wide array of financial backers, including one he has
cited in attacks during his campaign.
For
example, an office building on Avenue of the Americas in Manhattan, of
which Mr. Trump is part owner, carries a $950 million loan. Among the
lenders: the Bank of China, one of the largest banks in a country that
Mr. Trump has railed against as an economic foe of the United States,
and Goldman Sachs, a financial institution he has said controls Hillary
Clinton, the Democratic nominee, after it paid her $675,000 in speaking fees.
Real
estate projects often involve complex ownership and mortgage
structures. And given Mr. Trump’s long real estate career in the United
States and abroad, as well as his claim that his personal wealth exceeds
$10 billion, it is safe to say that no previous major party
presidential nominee has had finances nearly as complicated.
As
president, Mr. Trump would have substantial sway over monetary and tax
policy, as well as the power to make appointments that would directly
affect his own financial empire. He would also wield influence over
legislative issues that could have a significant impact on his net
worth, and would have official dealings with countries in which he has
business interests.
Yet
The Times’s examination underscored how much of Mr. Trump’s business
remains shrouded in mystery. He has declined to disclose his tax returns
or allow an independent valuation of his assets.
Earlier
in the campaign, Mr. Trump submitted a 104-page federal financial
disclosure form. It said his businesses owed at least $315 million to a
relatively small group of lenders and listed ties to more than 500
limited liability companies. Though he answered the questions, the form
appears to have been designed for candidates with simpler finances than
his, and did not require disclosure of portions of his business
activities.
Beyond
finding that companies owned by Mr. Trump had debts of at least $650
million, The Times discovered that a substantial portion of his wealth
is tied up in three passive partnerships that owe an additional $2
billion to a string of lenders, including those that hold the loan on
the Avenue of the Americas building. If those loans were to go into
default, Mr. Trump would not be held liable, the Trump Organization
said. The value of his investments, however, would certainly sink.
Mr.
Trump has said that if he were elected president, his children would be
likely to run his company. Many presidents, to avoid any appearance of a
conflict, have placed their holdings in blind trusts, which typically
involves selling the original asset, and replacing it with different
assets unknown to the seller.
Mr. Trump’s children seem unlikely to pursue that option.
Richard
W. Painter, a professor of law at the University of Minnesota and, from
2005 to 2007, the chief White House ethics lawyer under President
George W. Bush, compared Mr. Trump to Henry M. Paulson Jr., a former
chief executive of Goldman Sachs whom Mr. Bush appointed as Treasury
secretary.
Professor
Painter advised Mr. Paulson on his decision to sell his Goldman Sachs
shares, saying it was clear that Mr. Paulson could not simply have
placed that stock in trust and pretended it did not exist.
If
Mr. Trump were to use a blind trust, the professor said, it would be
“like putting a gold watch in a box and pretending you don’t know it is
in there.”
‘We Overdisclosed’
“I
am the king of debt,” Mr. Trump once said on CNN. “I love debt.” But in
his career, debt has sometimes gotten the better of him, leading to at
least four business bankruptcies.
He is, however, quick to stress that these days his companies have very little debt.
Mr. Trump indicated in the financial disclosure form he filed in connection with this campaign that he was worth at least $1.5 billion,
and has said publicly that the figure is actually greater than $10
billion. Recent estimates by Forbes and Fortune magazines and Bloomberg
have put his worth at less than $5 billion.
Graphic
What Donald J. Trump Owns and Owes
The Republican presidential nominee has an interest in
more than 30 U.S. properties, roughly half of which have debt on them.
To
gain a better understanding of Mr. Trump’s holdings and debt, The Times
engaged RedVision Systems, a national property information firm, to
search publicly available data on more than 30 properties in the United
States. The Times identified these assets through Federal Election
Commission filings, information provided by the Trump Organization and
records, such as filings with the Securities and Exchange Commission.
The
search covered thousands of pages of public information, including loan
documents, land leases and property deeds. It concentrated on Mr.
Trump’s commercial holdings, including office towers, golf courses, a
vineyard in Virginia and even an industrial building in South Carolina
that he ended up with after a troubled business venture involving Donald
Trump Jr. The inquiry also examined some of Mr. Trump’s residential
properties, including his penthouse apartment on Fifth Avenue and a
house he owns in Beverly Hills, Calif. The examination did not include
Mr. Trump’s dealings outside the United States.
That
Mr. Trump seems to have so much less debt on his disclosure form than
what The Times found is not his fault, but rather a function of what the
form asks candidates to list and how.
The
form, released by the Federal Election Commission, asks that candidates
list assets and debts not in precise numbers, but in ranges that top
out at $50 million — appropriate for most candidates, but not for Mr.
Trump. Through its examination, The Times was able to discern the amount
of debt taken out on each property, and its ownership structure.
Continue reading the main story
At
40 Wall Street in Manhattan, a limited liability company, or L.L.C.,
controlled by Mr. Trump holds the ground lease — the lease for the land
on which the building stands. In 2015, Mr. Trump borrowed $160 million
from Ladder Capital, a small New York firm, using that long-term lease
as collateral. On his financial disclosure form that debt is listed as
valued at more than $50 million.
Allen
Weisselberg, chief financial officer of the Trump Organization, said
that Mr. Trump could have left the liability section on the form blank,
because federal law requires that presidential candidates disclose
personal liabilities, not corporate debt. Mr. Trump, he said, has no
personal debt.
“We
overdisclosed,” Mr. Weisselberg said, explaining that it was decided
that when a Trump company owned 100 percent of a property, all of the
associated debt would be disclosed, something that he said went beyond
what the law required.
Continue reading the main story
Filing Taken at ‘Face Value’
For
properties where a Trump company owned less than 100 percent of a
building, Mr. Weisselberg said, those debts were not disclosed.
Mr.
Trump, for example, has a 50 percent stake in the Trump International
Hotel Las Vegas. In 2010, the company that owns the hotel refinanced a
$190 million loan, according to Real Capital Analytics, a commercial
real estate data and analytics firm.
Mr.
Weisselberg said that a Trump entity was responsible for half the debt,
and that all but $6.4 million of the loan had been paid off.
The
Times found three other instances in which Mr. Trump had an ownership
interest in a building but did not disclose the debt associated with it.
In all three cases, Mr. Trump had passive investments in limited
liability companies that had borrowed significant amounts of money.
One
of these investments involves an office tower at 1290 Avenue of
Americas, near Rockefeller Center. In a typically complex deal, loan
documents show that four lenders — German American Capital, a subsidiary
of Deutsche Bank; UBS Real Estate Securities; Goldman Sachs Mortgage
Company; and Bank of China — agreed in November 2012 to lend $950
million to the three companies that own the building. Those companies,
obscurely named HWA 1290 III LLC, HWA 1290 IV LLC and HWA 1290 V LLC,
are owned by three other companies in which Mr. Trump has stakes.
Ultimately, through his investments, Mr. Trump is a 30 percent owner of the building, records show. Vornado Realty Trust owns the other 70 percent and is the controlling partner.
A
similar ownership structure is in place at 555 California Street in San
Francisco, formerly the Bank of America Center. There, Pacific Life
Insurance Company and Metropolitan Life Insurance Company lent $600
million in 2011 to a limited liability company of which Vornado owns 70
percent and Mr. Trump owns 30 percent.
Green Street Advisors, a real estate research firm, estimates the combined value of the two buildings to be about $3.7 billion.
On
a smaller scale, Mr. Trump also has a 4 percent partnership interest in
a company that has an interest in a large Brooklyn housing complex, and
owes roughly $410 million to Wells Fargo, according to Bloomberg data.
The
full terms of Mr. Trump’s limited partnerships are not known. The
current value of the loans connected to them is roughly $1.95 billion,
according to various public documents.
Mr.
Weisselberg, the Trump Organization’s chief financial officer, said
that neither Mr. Trump nor the company were responsible for the debt
associated with the limited partnerships.
Still,
as with all of the properties in which Mr. Trump holds an interest, the
value of the buildings as well as the terms and magnitude of their debt
could have a major impact on his personal fortune.
Mr.
Trump, Mr. Weisselberg added, was liable for a “small percentage of the
corporate debt” listed on the federal filing but would not elaborate.
Other
instances in which Mr. Trump could be personally responsible can be
found in public filings. He guaranteed as much as $26 million for the
loan taken out against his land lease at 40 Wall Street, money the
lender could take if certain things went wrong.
Continue reading the main story
The
United States Office of Government Ethics, which reviewed Mr. Trump’s
financial filing before the F.E.C. released it, said it does not comment
on submissions by individual candidates.
The agency’s procedures for staff members reviewing presidential submissions,
a copy of which was obtained by The Times through a Freedom of
Information Act request, say the Office of Government Ethics does not
audit reports for accuracy.
“Disclosures
are to be taken at ‘face value’ as correct, unless there is a patent
omission or ambiguity or the official has independent knowledge of
matters outside the report,” the procedures say.
A Web of Investments
Tracing
the ownership of many of Mr. Trump’s buildings can be a complicated
task. Sometimes he owns a building and the land underneath it;
sometimes, he holds a partial interest or just the commercial portion of
a property.
And
in some cases, the identities of his business partners are obscured
behind limited liability companies — raising the prospect of a president
with unknown business ties.
At
40 Wall Street, Mr. Trump does not own even a sliver of the actual
land; his long-term ground lease gives him the right to improve and
manage the building. The land is owned by two limited liability
companies; Mr. Trump pays the two entities a total of $1.6 million a
year for the ground lease, according to documents filed with the S.E.C.
The
majority owner, 40 Wall Street Holdings Corporation, owns 80 percent of
the land; New Scandic Wall Limited Partnership owns the rest, according
to public documents. New Scandic Wall Limited Partnership’s chief
executive is Joachim Ferdinand von Grumme-Douglas, a businessman based
in Europe, according to these documents.
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The
people behind 40 Wall Street Holdings are harder to identify. For
years, Germany’s Hinneberg family, which made its fortune in the
shipping industry, controlled the property through a company called 40
Wall Limited Partnership. In late 2014, their interest in the land was
transferred to a new company, 40 Wall Street Holdings. The Times was not
able to identify the owner or owners of this company, and the Trump
Organization declined to comment.
Mr.
Trump has long-term ground leases on several other properties,
including a golf course in New York’s Hudson Valley and retail space in
Midtown Manhattan. Private owners are also behind these leases, their
identities sometimes obscured by L.L.C.s.
Mr.
Trump’s status in these situations is indicated by the word tenant,
which is listed under his signature on many of the relevant documents.
Mr.
Trump also holds a ground lease on the almost-completed Trump
International Hotel in the Old Post Office building in Washington, a few
blocks from the White House. The federal government, which owns the
land, gave a 60-year lease
to Trump Old Post Office, a limited liability company controlled by Mr.
Trump and members of his family. In return, the government receives a
minimum of $3 million a year from the company.
Mr.
Weisselberg said that despite his holdings, Mr. Trump should not be
held to the same standards that might apply to the heads of companies in
highly regulated industries.
“If
you take away all the fancy stuff and so on and so forth, and the
five-star ratings, you are basically down to a closely held family-run
business that is fundamentally different from IBM or Exxon,” Mr.
Weisselberg said, quoting from an email he had received from Donald F.
McGahn, a lawyer and former chairman of the F.E.C. who advised Mr. Trump
on his federal filing. Mr. McGahn did not return calls for comment.
Others
disagree. Mr. Trump’s opaque portfolio of business ties makes him
potentially vulnerable to the demands of banks, and to business people
in the United States and abroad, said Professor Painter, the former
chief White House ethics lawyer.
“The
success of his empire depends on an ability to get credit, to get loans
extended to his business entities,” he said. “And we simply don’t know a
lot about his financial dealings, here or around the world.”
Continue reading the main story
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