During a bizarre interview with The New York Times released on Wednesday night, Donald Trump issued a typical veiled threat. The Donald warned that he would dump Robert Mueller as special counsel investigating Russia’s interference in the election if the investigation came anywhere near his family’s business interests.
Well, that threat may have come back to haunt him. Less than 12 hours after The Times interview went online, word got out that Mueller was indeed looking into Trump’s widespread business deals. Soon after that, another shoe dropped. It turns out that Mueller is about to get a hefty dose of information from the people who may know more about Trump’s business transactions than anyone–his bankers at Deutsche Bank.
For those who don’t recall, Deutsche Bank is by far Trump’s largest lender and largest known creditor. It was one of the few banks that has been willing to stand by Trump in the wake of his six bankruptcies–four of which were filed in 1991 and 1992. In the last two decades, Deutsche Bank has given Trump a whopping $4 billion in loans and potential bond offerings.
It even stood by Trump in the face of one of the most bizarre episodes in a business career full of them. When Trump welched on the $640 million loan he used to build Trump International Hotel and Tower in Chicago, he actually sued Deutsche Bank to get out of a $40 million payment, citing its supposed role in the financial crisis. Deutsche naturally countersued. The two sides settled out of court, and Trump ultimately paid the loan with money from a loan from Deutsche’s wealth management unit. He now works with Deutsche’s private bank.
The Guardian reported that Deutsche Bank executives expect to get “subpoenas or other requests for information” from Mueller very soon. However, the bank has “already established informal contact” with Mueller’s team.
Somewhere down the line, it’s very likely that Deutsche Bank will share the results of its recent internal review of Trump’s banking practices. The review was triggered when Trump’s election as president made him a “politically exposed person”–someone with a high risk of being involved in corrupt practices, and aimed to determine if the Kremlin guaranteed any of Trump’s loans. Even though the bank found nothing improper, it’s still likely Mueller will be very interested in taking a look at the bank’s findings. After all, this was the only known third-party review of Trump’s ties to Russia before the House, Senate, and Justice Department finally got serious about investigating them.
It’s not as if Deutsche Bank had a choice to cooperate. According to The New York Times, bank regulators in New York state want to know if the volume and amount of loans Deutsche Bank made to Trump “expose(d) the bank to heightened risk.” In the last six years, Trump used $300 million worth of Deutsche loans to finance three projects–including the sparkling new hotel housed inside the Old Post Office Pavilion. Most Wall Street insiders find it highly unusual for any one person to get that kind of money.
Moreover, Deutsche Bank has already had the hot lights turned on it for its ties to Russia. Earlier this year, it coughed up a total of $630 million in fines to American and British regulators for failing to stop money laundering at its Moscow branch. Watch coverage of that case from France 24 here.
Deutsche came under fire for its failure to stop $10 billion in suspicious “mirror trades” over four years. Clients bought securities in rubles in Moscow, then sold them for an identical price in dollars in London.
That isn’t the only time has had some explaining to do for its role in Russian money laundering. It was also flagged as a major lender for Prevezon Holdings, the Russian real estate company that laundered $230 million in fraudulent Russian tax refunds by using it to buy real estate in Manhattan. According to federal prosecutors, Prevezon received some $90 million in financing from Deutsche Bank.
If Mueller is already looking at Deutsche Bank’s relationship with Trump, this investigation is moving along faster than anyone could have expected. After all, we may be about to get the clearest picture of Trump’s finances short of his tax returns. Even if the fat lady isn’t about to sing, it’s fair to wonder if auditions may be about to start.
(featured image courtesy Brals CE, available under a Creative Commons-BY license)
