More Trump, Russian Ties

More Trump, Russian Ties

White House blasts leak of part of tax return, calls it part of the agenda of 'the dishonest media'

Putin’s Pal Bought Trump’s Palm Beach Mansion

Oligarch and Trump’s commerce secretary have ties to questionable Cyprian bank

BY ABQ FREE PRESS WEEKLY STAFF

MSNBC’s Rachel Maddow reports that a Russian oligarch with ties to a Cyprian bank reputed to have engaged in Russian money laundering bought Trump’s Palm Beach home for nearly $100 million – about $60 million more than Trump paid for it less than four years earlier.

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During a March 14 show in which Maddow revealed she had obtained a portion of Trump’s 2005 tax return, she detailed connections between the oligarch, Trump’s commerce secretary, a former head of Deustche Bank, Putin and the Cyprian bank that has been linked to Russian money laundering.

Maddow cited recent reporting by the Palm Beach Post, Tampa Bay Tribune, the Seattle Times and McClatchy News Service about a Palm Beach real estate deal Trump made in 2008 with Russian billionaire Dmitry Rybolovlev, reputed to the the 119th richest man in the world.

Rybolovlev is the largest shareholder of the Bank of Cyprus and a close friend of Russian President Vladimir Putin.

In the 2008 deal, Rybolovlev, bought the 62,000-square-foot Palm Beach mansion formerly known as Maison de L’Amitie, or House of Friendship, which was then owned by Trump.

For the future president, the deal went down at a time when Deutsche Bank “was breathing down his neck” to repay loans owed it by The Trump Organization, Maddow said.

A massive profit in a depressed real estate market

That year was also a time when the Palm Beach real estate market, along with the rest of the U.S. real estate market, was depressed because of the housing crash.

But while homeowners and real estate investors across America were taking a bath, Trump was paid by Rybolovlev $95 million, or more than twice the $40 million he paid to buy the mansion less than four years earlier.

The Bank of Cyprus has a reputation as a haven for Russian money laundering and allowing them to convert rubles into dollars in violation of Russian law. It was headed by former Deutsche Bank CEO Josef Ackermann, who was selected for to head ther bank by one of the bank’s two vice-chairmen, Trump’s close friend, Wilbur Ross. Deutsche Bank was fined by U.S. authorities for participating in illegal “mirror trades” structured to move money out of Russia.

The other other vice-chairman of the Cyprian bank was appointed by Putin.

On Feb. 27, a day before Ross was sworn in as Trump’s commerce secretary, Senate Democrats accused the White House of blocking their requests that Ross answer questions about his own links and his bank’s links to Russians.

He was confirmed without the Senate ever receiving the requested information.

The Deutsche Bank nexus

The connections between and among Ross, Rybolovlev, Deutsche Bank, the Bank of Cyprus – and ultimately Trump – appear to be relevant to other recent developments.

Deutsche Bank is currently under investigation by the office of the U.S. Attorney for the Southern District of New York.

On March 10, U.S. Attorney General Jeff Sessions requested the resignations of 46 U.S. attorneys. Among them was the U.S. attorney for the Southern District of New York, Preet Bharara.

Bharara made headlines by insisting he did not resign but was fired. Bharara’s departure may hinder ongoing federal probes, including inquiries into Deutsche Bank’s role in the mirror trades, multiple media outlets have reported.

Additionally, the Civil Frauds Unit that Bharara created landed nearly $500 million in settlements – including multi-million dollar deals with CitiMortgage and Deutsche Bank for engaging in the type of reckless lending practices that led to the 2008 financial crisis.

The leaked tax data

In her March 14 show, Maddow touted a scoop: the revelation of how much Trump paid in taxes in 2005. Trump has refused to release his tax returns, the first president to do so in decades.

Maddow got a portion of the president’s 2005 return from Pulitzer Prize-winning former New York Times reporter David Cay Johnston, who said he was mailed two pages of the 2005 return anonymously.

Johnston, who won a Pulitzer for exposing tax loopholes for the rich and who wrote a book, “The Making of Donald Trump,”  told several news media outlets that the leaked data shows Trump actually paid only 24 percent of his income in taxes.

Thanks to a tax shelter Trump apparently used that later was made illegal by Congress, Trump was able to write off $103 million in losses that year to offset $153 million in income, Johnston said.

That he paid 24 percent of his taxes was due to the Alternative minimum tax, an IRS provision Trump wants to repeal. Had there been no alternative minimum tax in 2005, Trump would have paid just $5 million in taxes – or less than 3.5 percent of his income, “which is less than what the poorest half of Americans pay,” Johnston told NPR’s “Morning Edition.”

Implications of the Palm Beach deal

Maddow used the arc of Trump’s dealings with Russians and his refusal to produce his returns to ask the following:

“Couldn’t the tax returns [Trump refuses to release] sort out for us this historic, inexplicable dump of foreign money into the President’s coffers that cannot be explained in normal business terms?

“That’s a potential problem for someone serving as President of the United States. Is the President in a position where we need to watch to make sure that he’s not paying off his past benefactors with our country’s resources, with U.S. policy, with decisions he can make as President?”

White House response

The White House dismissed the MSNBC report.

The White House, in advance of Maddow’s report, released some details of the 2005 return, although not the return itself, which the administration said showed that Trump made $150 million that year and paid $38 million in taxes: $5.3 million in regular income tax plus $31 million in what’s known as the “alternative minimum tax,” bringing his federal payment that year to about 25 percent of his income.

“The dishonest media can continue to make this part of their agenda, while the President will focus on his, which includes tax reform that will benefit all Americans,” the White House said of the MSNBC report, according to the Washington newspaper, The Hill.

Since the disclosure of the portion of the president’s 2005 tax return, there has been speculation among the news media, including Johnston, the leak’s recipient, that the leaker may have been Trump himself.

“Donald has a long history of leaking things about himself and doing it indirectly and directly,” Johnston told CNN’s Harlow and Chris Cuomo. “So it’s a possibility.”

Johnston published the leaked documents on his website DCReport.org.

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Albuquerque’s definitive alternative newspaper publishing an inquisitive, modern approach to the news and entertainment stories that matter most to New Mexicans. ABQ Free Press’ fresh voice speaks to insightful and involved professionals who care deeply about our community.