It’s beginning to look like Special Counsel Mueller will catch President Trump and his three eldest children committing the first ever reality TV show assisted financial crime, all collaborating in a $350 million dollar bank fraud related to the Trump SoHo Condominium Hotel.
The fraud-riddled Trump SoHo project ultimately failed and was foreclosed upon by lenders in 2014, but its legacy lives on in a byzantine web of lawsuits.
We’ve obtained leaked copies of those emails related to a key lawsuit related to the Trump SoHo – which is embedded below – that outline the Trump family’s complicity in a major financial crime.
They show that Donald Trump and his three eldest children participated in a cover-up in order to keep borrowing massive construction loans on the hotel they pitched on NBC’s Apprentice from failing during the financial downturn. The Trump Organization earned $3 million dollars from the fraud just last year alone, even as the hotel’s fortunes have sunk post-election.
Three weeks ago, Bloomberg News reported that Mueller is focusing on the lower Manhattan Trump Soho Hotel deal and Vanity Fair reported recently that new emails reveal the Trump family’s participation in a criminal enterprise there.
The Russian money trail leads right through the president’s troubled project in downtown Manhattan. A series of e-mails reveals new details.
ZDF interviewed an American national financial fraud expert Professor William Black, who was told the sordid tale of the Trump SoHo frauds without being told the names of the participants.
He concluded that based on their thorough reporting that the First Family participated in a business that was committing bank fraud in a pattern and a practice of illegal conduct which violated the federal racketeering laws known as the RICO Act.
RICO Act cases are subject to enforcement in both civil lawsuits with tripled damages and criminal law, with jail and restitution to the victims as the penalty.
Trump SoHo’s Developers Screwed Their Employees, So They Sued For Racketeering
A lawsuit by Trump’s former development partners Bayrock, the company led by a mafia associate & Russian-emigre Felix Sater, has already exposed a direct tie between Donald Trump’s New York City development activities at Trump SoHo and Vladimir Putin’s money.
Former Bayrock executive Jody Kriss sued his former employer and Sater – who was Trump’s business partner and longtime advisor – for operating a criminal enterprise (RICO), committing bank fraud and refusing to pay employee-related bonuses he had earned.
Bank obligations forbid loans to known felons or the companies they operate.
As both a manager and member of Bayrock’s limited liability company which borrowed the money, Felix Sater both owned and operated the Trump SoHo project.
Anyone in the transaction who knew participated in the enterprise and hid that material fact from the bank if they knew about it, becomes the party to a criminal enterprise.
In mid-December 2007, New York Times publicly revealed that Felix Sater had secretly entered financial felony plea deal in the late 1990s, and was also convicted of a felony assault against the mafia associate from a bar fight.
Hiding a Sater’s involvement in Bayrock and the Trump SoHo project is a form of criminal bank fraud.
Newly leaked emails from an attorney for one of the Bayrock partners named the Sapir Organization – documents an urgent “time sensitive and should not be pushed back” detail a meeting which all of the Trumps demanded with Sater and Bayrock on January 21st, 2008.
Donald Trump, his daughter Ivanka and sons Don Jr. and Eric collectively demanded and presumably attended the important meeting to chew out Bayrock about the project, and specifically Felix Sater about his felony past.
Instead of informing banks and buyers about Sater’s criminal past, as was the Trump Organization’s obligation, the Trump family proceeded to keep the felony secret as Sater engaged in a scheme to hide his interests in the deal.
We know because Sater wrote to Bayrock’s investors in Iceland (who laundered Putin’s money) complaining that his own company wanted to fire him over his felony convictions after meeting the Trumps.
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Here is the smoking gun email explaining that the Trump family and all partners in the venture wanted to attend the meeting (full chain embedded below) to discuss Sater’s felony past, which they then kept secret:
The Trumps Stood To Benefit Financially From Participating In A Criminal Enterprise
Donald Trump had a lot to lose by removing his name from the SoHo project if the construction loans were canceled. Bloomberg reports:
The hook at Bayrock, for Trump, was an 18 percent equity stake in what became the Trump Soho hotel, a steady stream of management fees on all Bayrock projects and the ability to plaster his name on properties without having to invest a single dollar of his own.
So, instead of doing the right thing, the Trump family proceeded to squeeze their partner through Bayrock, Felix Sater, to take his financial stake in the deal. (email)
Sater’s after-action report was discovered in court in the form of a smoking gun email in Forbes that described the meeting with the Trump family in detail and cemented his involvement in a scheme to defraud using Trump SoHo.
The email message completely revealed Trump’s future Senior Advisor describing in great detail the finer points of his scheme to defraud the banks to his project’s Icelandic equity investors from Stodir (aka FL Group), who themselves went bankrupt only 9 months later.
Sater even intricately recounted the story of Bayrock’s General Counsel Julius Schwarz’s attempt to immediately force him out of Bayrock over the revelation of his felony conviction which he described as “damaging.”
The Racketeering Influenced Corrupt Organizations (RICO) Act is America’s top anti-mafia federal law and the threshold for violating the law is merely participating in a business which engages in a pattern of illegal or fraudulent behavior.
New York state also has a RICO law, which is not subject to the powers of the Presidential pardon and could be enforced by New York State Attorney General Eric Schneiderman, alongside any federal investigation.
“The statute of limitations on RICO acts lasts for ten years from the last known act,” for RICO based upon bank fraud, according to lawyer Joshua Gold, who is licensed to practice in New York since 1999. “These emails are less than ten years old.”
Even though Trump’s participation in the project dates back to far more than ten years ago — and was far more than just licensing the family’s brand name — only criminal acts like hiding his partner’s felony count, start the clock ticking on the ten years a prosecutor could call forth a criminal case on the matter.
Hawking the Trump SoHo Hotel on NBC’s The Apprentice
During Season 5 of NBC’s “The Apprentice” Donald Trump awarded a job at the Trump SoHo Hotel to winner Sean Yazbek in February 2006.
Later, Donald Trump pitched the Trump SoHo Condo Hotel project on The Apprentice in early September 2007. He launched the boxy tower shortly thereafter according to the New York Daily News with “servers in masks pour champagne while Cirque du Soleil performed. The reigning Miss USA attended.”
Trump’s development group borrowed $350 million of the $450 million cost of building Trump SoHo from banks, they apparently couldn’t swallow their pride, risk a very high profile foreclosure, and tell their bank lenders the truth and suffer the consequences.
The following year two major Wall Street firms failed killing real estate lending markets for years, and Donald Trump stopped hawking the Trump SoHo deal on NBC.
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Trump SoHo Crashed And Never Recovered
By the end of 2009, the New York Times reported that the condotel market had been dead as far back as 2007, which would’ve given Donald Trump, even more of an incentive to conceal material information that would cause his lenders to repossess his tower during the crash.
Eventually, lenders did foreclose on the property and sold off the Trump SoHo condo after 2/3rds of the units remained unsold in 2014.
The information about Trump and Sater defrauding banks has come to light only because attorneys Fred Oberlander and Richard Lerner refused to back down. They filed and are litigating two of the civil cases against the Trump SoHo’s developers.
Federal judges and prosecutors threatened them with prosecution for revealing that Sater was given an illegally light sentence for his crime, in secret. The judges even issued an order that gagged them from telling Congress about the judges’ own misconduct, but the attorneys persisted and are pursuing a civil law claim against the developers of Trump SoHo.
The attorney Richard Lerner has since written an extensive, fact-checked article about the harmful effects of secret sentencing in Law360 based on his wild experiences in the Trump SoHo case with Sater, who became an FBI informant against his mafia partners in the scheme.
Special Counsel Mueller will have his hands full unraveling all of the Russian money connections to the Trump SoHo project.
It’s increasingly looking like there is substantive proof of criminal ties between the Trump family and Felix Sater, which may deliver the evidence of crime prosecutors seek to flip witnesses against larger targets.
Even worse for the Trump family, the criminal liability triggered by their ill-advised bank fraud cover-up can be prosecuted in both federal court – where the President could pardon his children – and in state court, where he cannot pardon crimes.
Theoretically, even Donald Trump’s children could turn into the state’s witnesses against their father, the President because he recklessly dragged them into the Trump SoHo bank fraud scheme and cover-up of their shady real estate deal partners’ financial crimes.