A court-appointed monitor overseeing Donald Trump’s businesses on Friday alerted the judge overseeing his New York fraud case that the former president’s financial disclosures are “incomplete” or “inconsistent.”
"I have identified certain deficiencies in the financial information that I have reviewed, including disclosures that are either incomplete, present results inconsistently, and/or contain errors," former federal judge Barbara Jones, who was appointed by Judge Arthur Engoron to monitor Trump’s finances, wrote in a 12-page letter according to The Messenger.
Jones wrote that Trump’s companies have been generally “cooperative” but wrote in a footnote that a $48 million debt Trump claimed to owe to one of his companies for years did not exist, as flagged by The Daily Beast’s Roger Sollenberger.
“When I inquired about this loan, I was informed that there are no loan agreements that memorialize the loan, but that it was a loan that was believed to be between Donald J. Trump, individually, and Chicago Unit Acquisition for $48 million,” Jones wrote, referring to the shell company that held Trump’s debt.
“However, in recent discussions with the Trump Organization, it indicated that it has determined that this loan never existed—and thus that it would be removed from any upcoming forms submitted to the Office of Government Ethics (OGE) and would also be removed from subsequent versions of [corporate financial statements],” Jones wrote.
If true, “that would essentially be an admission from the Trump Organization that all the financial disclosures Trump has filed with the federal government listed an entirely fictional debt worth tens of millions of dollars, which Trump claimed he personally owed to one of his own companies,” Sollenberger explained.
Alan Garten, chief legal counsel for the Trump Organization, denied the allegation and insisted that the loan did exist.
“That’s one of many inaccuracies contained in the monitor’s letter, which we will be addressing with the court,” Garten told The Daily Beast, adding that it was an “internal loan” where Trump “lent money to the entity that he owns.”
But in contradiction to Trump’s own statements, Garten claimed that the LLC actually owed the money to Trump. Trump’s most recent financial disclosure last October stated that it was Trump who owed the Chicago Unit Acquisition LLC more than $50 million. Trump told The New York Times in 2016 that he bought the loan back from a “group of banks several years ago” and chose to keep the debt on the books to pay interest on it to himself.
“We don’t assess any value to it because we don’t care,” Trump told the outlet. “I have the mortgage. That is all there is. Very simple. I am the bank.”
Jordan Libowitz, a spokesperson for the watchdog group Citizens for Responsibility and Ethics in Washington, told The Daily Beast that Jones’ report suggests Trump broke the law.
“When you fill out your personal financial disclosures, you attest under penalty of the law that the information is true. Trump had to know that his Chicago business never gave him a loan of more than $50 million, as he claimed, repeatedly,” he said.
“While the reasons behind claiming this fake loan are still unknown, at the very least he misled the government for years about his finances,” he added. “It appears that Trump knowingly and intentionally broke the law. The only question is how many laws.”
Kedric Payne, general counsel for the watchdog group Campaign Legal Center, told the outlet it “seems clear that Trump inaccurately reported this loan, and it’s unlikely that he will get the benefit of the doubt that it was a simple mistake.”
“It defeats the purpose of the disclosure laws if the public does not have complete and accurate financial information for their elected officials,” he added.
Martin Lobel, a prominent D.C. tax lawyer, told The Daily Beast that “assuming Judge Jones’ letter is accurate,” this “amounts to tax evasion.”
“This explains why the Republicans have been so intent on cutting the IRS’s budget,” he said, “because they don’t want it to be able to audit transactions like this.”
Martin Sheil, former special criminal investigative agent for the Internal Revenue Service, told the outlet that the whole matter appears “shady.”
“The fact that Jones, as a court appointed monitor, officially references the transaction as a $48 million loan that never existed, should raise eyebrows,” Sheil said. “That there exists no loan agreements or other indicia of an actual loan certainly suggests the existence of an alternate possible characterization of the large money transfer as income.”
Sheil added that an investigation would have to establish intent, which may mean getting witnesses to cooperate.
“Documents don’t lie but people do,” he said.
