House Democrats are planning to cross one of President Donald Trump’s red lines: investigating his personal finances.
With special counsel Robert Mueller expected to wind up his work soon, Democrats are launching an investigation to discover why Deutsche Bank was willing to lend the Trump Organization money when other banks wouldn’t and whether Russia was involved.
The German bank, which has been under scrutiny for its role in Russian money laundering, lent Trump hundreds of millions of dollars over the years for his property development ventures.
The House Financial Services and Intelligence Committees have been staffing up for their probes into the bank and Trump’s Russia ties. Democrats on the panels say that with Deutsche Bank they are willing to pursue a key area that Mueller may have avoided — crossing what Trump sees as a “red line” into his personal finances.
“There’s a heightened need to look into anything that could compromise the president or the country, particularly if it’s not being investigated elsewhere,” House Intelligence Committee Chairman Adam Schiff (D-Calif.) told POLITICO. “I don’t know that to be the case but I just haven’t seen any external signs that that’s happening.”
Democrats won’t be confined by boundaries set by the president as they ramp up their probes, so any perceived omissions by Mueller will be prime targets for House committees.
“What does Bob Mueller know?” said Rep. Denny Heck (D-Wash.), a member of the two committees. “Has he requested information from Treasury? Does he have anything from them? I don’t know one way or another. Has he requested anything directly from Deutsche Bank? There seems to be indications not, but we really don’t know.”
Democrats are skeptical that Mueller showed much interest in Deutsche Bank because of reporting last year that Trump nearly tried to shut down the Russia investigation — prompted by news that Mueller had subpoenaed the lender — but backed down after the special counsel’s office denied the stories.
“I’m happy to be proven wrong,” Schiff said.
A spokesperson for Deutsche Bank declined to comment on the Mueller investigation but said the bank “takes its legal obligations seriously and remains committed to cooperating with authorized investigations.” The White House referred questions to the Trump Organization, which did not respond to a request for comment.
In his latest financial disclosure filing, Trump reported owing Deutsche Bank at least $130 million.
House Democrats, now armed with their own subpoena power, aren’t waiting for the results of Mueller’s investigation. Schiff and Financial Services Chairwoman Maxine Waters (D-Calif.) have already agreed to work together on a probe of Deutsche Bank.
“We are moving forward,” Schiff said.
For Schiff, Deutsche Bank is a starting point as his committee investigates possible money laundering by the Trump Organization. Waters, who has called for the president’s impeachment, has said her inquiry into the “Trump money trail” would also start with the bank.
Waters told CNBC in an interview that aired this month that there was a need to look further into Trump’s finances to figure out “whether or not money laundering has been involved and whether or not there are connections with the oligarchs of Russia.”
Last year, House Intelligence Committee Democrats outlined concerns they had about Deutsche Bank in a status report on the panel’s Russia investigation, which at that time was being run by Republicans. Among their questions: Did Trump’s financial exposure via Deutsche Bank or other loans represent a point of leverage that Russia could exploit? Did the Russian government try to court Trump and launder money through the Trump Organization?
“There’s a desire to get the facts around whatever relationship Deutsche Bank might have had with the Trump Organization so that we can just put that behind us, whatever the facts may show,” said Rep. Jim Himes (D-Conn.), who serves on the committees that plan to investigate the bank.
Even House Republicans have raised questions about the German bank. Rep. Patrick McHenry (R-N.C.), the top Republican on the Financial Services Committee, asked Deutsche Bank’s CEO to lay out what measures the company has taken to respond to money laundering scandals.
McHenry is steering clear of Trump, but he told POLITICO that money laundering for Russians is a major, bipartisan concern and that his inquiry is “directed at solid policymaking.”
Further questions have mounted in recent weeks.
Bloomberg News reported Wednesday that bank executives discussed giving the Trump Organization more time to repay $340 million in loans until after a possible second Trump term in 2025 because of concerns that the Trump Organization might default. The New York Times reported earlier this month that Deutsche Bank turned down Trump for a loan in early 2016.
Democrats also have questions about how Trump’s businesses were able to rely on cash transactions in the years before he became president to fund real estate development, as opposed to investors’ money and debt — and despite a track record of bankruptcy.
“All we know is that there was one period of Donald Trump’s before he became president where he was spending cash for his developments all around the world.” said Rep. Emanuel Cleaver (D-Mo.), the chairman of a subcommittee with jurisdiction over money laundering issues. “Very few people pay cash when they do a big development. … He was paying cash at a time when he wasn’t supposed to have money. We’re going to have to find out why.”
Another question, Heck said, is whether anyone was guaranteeing Deutsche Bank’s loans to Trump.
“It’s a guy who ended up at Deutsche Bank because domestic U.S. banks wouldn’t touch him,” Heck said. “It begs the question, if nobody else would touch him, was Deutsche Bank’s desire to get into the market in the U.S. so strong that they were willing to override as it were all common underwriting practices, or was there another element present? We don’t know.”
Schiff said Democrats were “staffing up with people that have the appropriate expertise for each of the investigative threads that we are pursuing.”
The House Financial Services Committee has recruited Bob Roach, a veteran investigator who oversaw earlier Senate probes into Goldman Sachs, JPMorgan Chase and HSBC. Ty Gellasch, a former Senate colleague, described Roach as “remarkably familiar” with money laundering issues and seasoned when it comes to dealing with international banks and their regulators.
Roach may even share some traits with Mueller himself.
“Bob [Roach] tries to work in a bipartisan way and often more slowly than people might hope,” Gellasch said. “He’s extremely careful and doesn’t investigate by press release. If he’s left to work as he wants, the first we’ll learn of what he’s doing will likely be when the committee schedules its hearing and releases a report.”
Article originally published on POLITICO Magazine
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