The problems Vogell uncovered pertain to two signature Trump properties in Manhattan – 40 Wall Street and Trump International Hotel and Tower – and involve transactions and records she examined dated from 2012 to 2018. The Trump Organisation, its lawyers and its accountants declined to respond on the record to Vogell’s detailed questions about the irregularities.
The Trump Organisation has been at this game for a long time. When I interviewed its chief financial officer, Allen Weisselberg, in 2005 for a biography I wrote, TrumpNation, he told me that Trump valued 40 Wall Street at $US400 million – at a time when it was assessed for property tax purposes at only $US90 million.
Trump unsuccessfully sued me in 2006 for libel, arguing that TrumpNation damaged his reputation by including unflattering assessments of his business record and unfair speculation that he had spent decades inflating his wealth. Trump lost the suit in 2011, and during the litigation was forced to turn over his tax returns to my lawyers.
Fred Trump, the president’s father, taught his son the art of dodging assessments, taxes and record keeping. In 1954, Fred was called before the Senate to testify about overcharging the federal government millions of dollars by inflating costs associated with a taxpayer-subsidised, Trump-owned housing development in Brooklyn. The government then banned Fred from bidding on federal housing contracts – the foundation for his family’s wealth. So he turned to state-subsidized developments.
By 1966, a New York investigations board called him into embarrassing public hearings to explore how he had overbilled the state for equipment and other costs. Although he was never charged with wrongdoing, those hearings marked the end of Fred’s career as a major developer of publicly subsidised housing.
A devastating account of the Trump family’s finances and tax maneuveres that The New York Times published in 2018 revealed that Fred and his wife, Mary, structured their estate and the income it generated in ways both illegal and dubious. They ultimately transferred “over $US1 billion in wealth to their children, which could have produced a tax bill of at least $US550 million under the 55 per cent tax rate then imposed on gifts and inheritances”, the Times reported. Instead, the Trumps paid $US52.2 million in taxes, a rate of about 5 per cent.
The Times also reported that Trump “received the equivalent today of at least $US413 million from his father’s real estate empire”. It added that those riches flowed more fully due to “dubious tax schemes [Trump] participated in during the 1990s, including instances of outright fraud”. The Trumps did this, in part, by “grossly undervaluing” the properties they intended to pass on to their children. (A lawyer for Trump told the Times that the president, his parents and his siblings relied on outside advisers for tax planning purposes and that nothing they did was fraudulent.)
Weisselberg was Fred’s accountant as well as Donald’s CFO, and he has an intimate familiarity with the details of all of this. He co-operated with federal prosecutors in their investigation of Cohen’s dealings, and Vogell’s reporting is bound to renew interest in him. Vogell noted that Weisselberg’s son, Jack, was an executive at Ladder Capital, an institution that lent money to Trump for 40 Wall Street.
The Manhattan district attorney’s office is currently battling Trump and the US Justice Department for access to the president’s tax records as part of a criminal fraud investigation. Congressional committees have also subpoenaed Trump for his tax records, one of many requests he has refused to comply with.
Vogell has given prosecutors and legislators more ammunition. As she observes in her ProPublica article: “New York City’s property tax forms state that the person signing them ‘affirms the truth of the statements made’ and that ‘false filings are subject to all applicable civil and criminal penalties’.”
Those battles are playing out, of course, amid an impeachment inquiry that has put the president in a tight corner in Washington. Given how investigations are proceeding around his businesses, he’s unlikely to find much wiggle room in New York, either.
Timothy O’Brien is the executive editor of Bloomberg Opinion. He has been an editor and writer for the New York Times, the Wall Street Journal, HuffPost and Talk magazine. His books include TrumpNation: The Art of Being The Donald.