Why Trump And Kushner Should Be Terrified Of The Deutsche Bank Subpoenas
March 11, 2019: The New York Attorney General has subpoenaed records from Deutsche Bank related to loans President Trump’s company has received from the bank, according to multiple reports. This comes after Michael Cohen claimed Trump inflated his assets in an effort to try and obtain a loan from Deutsche Bank for the purchase of the Buffalo Bills – a loan he didn’t receive. In November 2018, Deutsche Bank was raided in a money laundering investigation related to the Panama Papers (there is no evidence this was related to Trump). Below is our deep dive from 2017 about Robert Mueller’s subpoena of Deutsche Bank, and how it could relate to Donald Trump and Jared Kushner.
In July of this year, New York Times reporters asked Donald Trump if it would be crossing a “red line” for Special Counsel Robert Mueller to investigate his and his family’s finances. Trump’s answer, once one parsed through the rambling non-sequiturs, suggested that an investigation into his financial history was the one line of questioning he would not stand for.
“No, I think that’s a violation. Look, this is about Russia. So I think if he wants to go, my finances are extremely good, my company is an unbelievably successful company. And actually, when I do my filings, peoples say, “Man.” People have no idea how successful this is. It’s a great company. But I don’t even think about the company anymore. I think about this. ’Cause one thing, when you do this, companies seem very trivial. O.K.? I really mean that. They seem very trivial. But I have no income from Russia. I don’t do business with Russia.”?—?Donald Trump to the The New York Times
Mueller has now apparently taken an interest in acquiring banking “data on accounts held by President Donald Trump and his family,” according to a report released Tuesday morning by Reuters. The report states that Mueller’s team issued a subpoena to Germany’s largest bank, Deutsche Bank, several weeks ago.
In the last few months, we’ve seen a marked increase in action from the Special Counsel’s probe. From the indictments leveled at Trump’s former Campaign Chairman Paul Manafort and his deputy Rick Gates to the guilty pleas from former campaign adviser George Papadopoulos and former National Security Adviser Michael Flynn for lying to the FBI, the house of cards this administration is built on is starting to come tumbling down.
The interest in financial records signals an even more serious era of this probe. Congressional investigators have long shown interest in acquiring information from Deutsche Bank, but until now that interest has been rebuffed. And in March, Democrats from the House Financial Services Committee raised concern over the potential conflict of interest posed by the President’s connection to the bank, in regards to a reported Justice Department investigation into matters involving Russian money laundering.
Late Tuesday, White House Press Secretary Sarah Huckabee Sanders and the President’s television lawyer Jay Sekulow claimed that they had “confirmed” with Deutsche Bank that reports of a subpoena were untrue. However, Reuters has stood by their claims, as have other news organizations which independently reported on the subject. Additionally, according to the U.S. Attorney’s Criminal Resource Manual Title 423, it is possible that financial institutions may be ordered to not notify a customer or their representation if grand jury subpoenas are issued regarding their banking records.
On Wednesday, the German paper that originally broke the subpoena story reaffirmed its reporting that the subpoena was indeed sent.
Spokespeople for Reuters & Bloomberg tell me they stand by their Deutsche bank stories, despite denial from Trump’s lawyer.
So why are these Deutsche Bank (DB) records potentially of extreme importance? The answer is as complicated and murky as most elements of this investigation seem to be. Trump’s companies owed the bank $364 million as of the end of last year, and Jared Kushner’s company held connections with the bank. Coincidentally, DB was recently fined for its connections to a Russian money laundering plot.
During the 1990s, when he experienced tide of poor luck bankrupting some of his hotel and casino dealings, many Wall Street financiers refused to lend to Trump. DB was one of the few major organizations still willing to provide the Trump name with credit and loans.
While we don’t know exactly what Mueller is looking for in his subpoena of these records, such an action puts many Trump associates under the spotlight?—?given their connections to both less-than-upstanding activities and foreign nationals. It also provides another element of support to the understanding that Mueller is focusing on financial crimes and related matters.
“Not only are his tangled web of LLCs a money laundering red flag, his past actions speak for themselves…
In 2008, Russian oligarch and fertilizer magnate Dmitry Rybolovlev bought a Trump property for $95 million, double what it was worth, which is a classic money laundering technique meant to bake payments or bribes into what looks like a real estate deal.
“A Reuters review has found that at least 63 individuals with Russian passports or addresses have bought at least $98.4 million worth of property in seven Trump-branded luxury towers in southern Florida.”
The FBI wiretapped offices in Trump Tower, investigating a Russian money laundering group run out of apartment 63A, implicating 30 people and involving assets owned by Trump in New York and Florida.
Trump’s reportedly has ties to the New York and Philadelphia mob that go back decades.”
Deep Throat once told journalist Bob Woodward to follow the money when investigating the Watergate scandal. And since history seems to be repeating itself lately, let’s dive deep into what this subpoena could potentially mean for the most impactful investigation of our times…
The Kushner Connection
Jared Kushner hasn’t been having a very good year. From revelations that he lied on security clearance forms (and then did it again…and again) to his attendance at the fateful June 2016 Trump Tower meeting, which was revealed to have been an attempt to obtain damaging information from the Russian government on Hillary Clinton, Kushner seems to have dirtied his hands at every possible opportunity. And now, he is known to be under investigation by Mueller, in regards to both his business dealings and meetings with Russians while working on the Trump transition team.
As such, the recent Deutsche Bank subpoena should concern him. His father-in-law isn’t the only one in debt to the bank. Approximately one month before the 2016 election, Jared Kushner’s real estate company received a $285 million loan from DB.
At the time, the bank was “negotiating to settle a federal mortgage fraud case and charges from New York state regulators that it aided a possible Russian money-laundering scheme,” according to reporting by the Washington Post. Both these cases were settled within two months of Trump being elected President.
Kushner reportedly made a personal guarantee on the loan, which he?—?in proper Kushner fashion?—?failed to disclose on his Office of Government Ethics’s financial disclosure form. This level of personal connection to a bank under investigation for potentially aiding a Russian money-laundering scheme and which was one of the only organizations that would lend his father-in-law money raises questions of impropriety at the very least.
In December of 2016, Kushner attended a meeting with the then-Russian ambassador, Sergey Kislyak, and Michael Flynn in an attempt to set up a back-channel line of communication between the Kremlin and Trump. He then set up a second, originally unreported, meeting at the behest of Kislyak.
This second meeting was with Sergey Gorkov, the Vladimir Putin-appointed chief of Vnesheconombank (VEB)?—?a Russian state-owned bank that has a “cooperation agreement” with DB. Gorkov graduated from the FSB Academy, making him essentially a trained spy.
VEB was placed under U.S. and European sanctions in 2014 and has significant connections to Russian security services. After said sanctions, Putin was forced to authorize $22 billion in state funding to cover the debts incurred by the bank.
Contextually speaking, let’s remember that the Trump administration made lifting these sanctions one of their first orders of business. Flynn went so far as to assure his business partners and Kisylak that sanctions would be lifted. In addition, the White House has yet to implement new sanctions on Russia passed near unanimously by Congress and signed into law by Trump in August.
The aforementioned cooperation agreement could have potentially allowed DB to transfer the loans it gave Donald Trump and Jared Kushner, which were reportedly in the hundreds of millions, to VEB?—?casting further scrutiny on the Kushner meetings.
If these loans were transferred, Trump might have been attempting to lift sanctions on his own debt-holders. This could be an explanation for much of the President’s conciliatory behavior towards Russia.
VEB also helped fund the Trump International Hotel and Tower in Toronto, a project which the President and his organization have moved to distance themselves from.
An important side note?—?in 2015 an employee of VEB, Evgeny Buryakov, was arrested and charged with criminal conspiracy in relation to a New York City spy ring. Prosecutors accused Buryakov, and two other men, of “conspir[ing] to gather economic intelligence on behalf of Russia, including information about U.S. sanctions against the country, and to recruit New York City residents as intelligence sources,” according to reporting by The Guardian. Buryakov pled guilty to these charges in 2016.
The court he was charged by? The Southern District of New York —Former U.S. Attorney Preet Bharara’s district.
Bharara originally brought the Prevezon Holdings case to light in the U.S, before being fired by Attorney General Jeff Sessions in March of 2017, at the President’s request.
I did not resign. Moments ago I was fired. Being the US Attorney in SDNY will forever be the greatest honor of my professional life.
Lawyer Sergei Magnitsky?—?who was eventually murdered, setting off a chain of events which included the implementation of U.S. sanctions on Russian officials and their assets?—?discovered the alleged fraud which led to the Prevezon case. After Bharara’s firing, the Prevezon case was quickly and surprisingly settled.
Here’s the kicker. Prevezon was represented by Natalia Veselnitskaya, the Russian lawyer who attended the infamous June 2016 Trump Tower meeting, along with Kushner, Trump Jr., and the now-indicted Manafort.
The Prevezon case and the related Magnitsky Act is heavily intertwined with major players in the Trump-Russia scandal, as well as the implementation of U.S. sanctions on Russian assets?—?a move that angered Putin and did concrete damage to U.S.-Russia relations.
These tangled connections could suggest a closer look at those who have something to gain by repealing the aforementioned sanctions.
To recap, Mueller’s subpoena of Deutsche Bank records could potentially be troubling for Kushner (and by extent, Trump) because:
The Next Level
In response to this news, Rep. Adam Schiff, the top Democrat on the House Intelligence Committee that is investigating potential Russian interference in the 2016 election released the following statement:
“Special Counsel Mueller’s subpoena of Deutsche Bank would be a very significant development. If Russia laundered money through the Trump Organization, it would be far more compromising than any salacious video and could be used as leverage against Donald Trump and his associates and family.”
The Deutsche Bank subpoena could potentially be extremely significant regarding the Trump-Russia probe, specifically because it suggests that Mueller is focusing on potential financial crimes within the Trump family.
Given the mafia prosecutorial tactics Mueller seems to be implementing, the fact that the known charges levied by his team have included crimes like conspiracy to launder money, and Donald Trump’s “red line” regarding investigating his and his family’s finances?—?one can almost understand why the President’s twitter feed has become oddly regulated.
(It’s worth noting that Mueller absolutely has the authority to investigate financial crimes if he discovers them. When he appointed Mueller, Deputy Attorney General Rod Rosenstein authorized the Special Counsel to probe “any links and/or coordination between the Russian government and individuals associated with the campaign of President Donald Trump…(and) any matters that arose or may arise directly from the investigation.”)
The Trump-Russia investigation has many branches and the possibility of financial crimes are just one. However, given what we know about the tactics of Mueller’s actions thus far?—?it’s a branch to pay close attention to.
Additionally, if Kushner is implicated in any wrongdoing, it places this investigation directly at Trump’s door. At the very least, it calls into question whether the President will let his son-in-law take the fall, or if he will exercise his pardon power.
Financial crimes?—?as well as Mueller’s cooperation with the New York Attorney General?—?may suggest that involved parties could be charged with state crimes, in addition to federal crimes. State crimes do not fall under presidential pardon jurisdiction.
As with each new revelation in this case, the potential that Mueller may use knowledge of crimes to coerce certain Trump associates to flip on others grows more likely. If the Deutsche Bank subpoena does reveal wrongdoing, it could be used to gain cooperation from important Trump associates.
Past all these hypotheticals, one thing is for certain. Robert Mueller is ten steps ahead of us all?—?and that, in and of itself, should terrify Donald Trump.
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