donald trump

How Donald Trump Reportedly Inflated His Net Worth to Lenders

Donald Trump in 2013. Photo: Susan Watts/NY Daily News via Getty Images

Whether he’s pretending to be his own PR person, questioning the accuracy of a damning quote caught on tape, or exaggerating the middle-class benefits of corporate tax cuts, Donald Trump has always had a loose relationship with the truth. According to a new report from the Washington Post, Trump’s shaky connection to factual reality also applied to business deals, in which the real-estate mogul — already known for stiffing on the bill — misreported his assets to convince lenders to provide him with funding.

According to the Post, if Trump wanted to impress a business partner or journalist, he would send over a folder called the “Statements of Financial Condition,” documents that ran up to 20 pages and were frequently packed with mistakes. In his 2011 version of the doc, Trump stated that he had 55 home lots for sale for a starting price of $3 million at his golf course in Los Angeles. But according to city records, only 24 lots actually existed, meaning Trump fabricated some $72 million in future revenue. Trump made a habit of massaging easily verifiable numbers, expanding, on paper, his winery by about 800 acres, and adding ten nonexistent stories to Trump Tower.

Could these financial inflations constitute fraud? There are laws protecting insurers and lenders from businessmen plying false information in their applications, though experts in financial law who spoke with the Post said it’s unclear if Trump will face legal consequences. (It’s a refrain that, at this point, feels like the binding theme of the Trump administration.) For his actions to be fraudulent, prosecutors would have to prove that Trump intended to mislead investors, or that the juiced documents provided him with a financial benefit. But Trump’s [Mis]statements of Financial Condition are so obviously stretched that Kyle Welch, an assistant professor of accountancy at George Washington University, told the Post that it’s unlikely that a reputable bank would be fooled. “It’s humorous,” he said. “It’s a humorous financial statement.”

The president’s financial puffery might not remain a joke, if investigations in D.C. and New York determine that Trump’s actions enter fraudulent territory. After the president’s former fixer, Michael Cohen, brought receipts to the House Committee on Oversight and Reform to verify his claim that Trump is “a cheat,” the committee requested a decade’s worth of Trump’s financial records from his accounting firm, Mazars Inc. In New York, the state’s Department of Financial Services subpoenaed records from Aon, a company that has insured Trump for years. According to a person familiar with the subpoena who spoke to the Post, a “key component” of the New York investigation is whether or not Trump gave Aon inaccurate documents in an attempt to slash his insurance premiums.

Another major affirmation from the Cohen testimony involved Trump’s lucrative relationship with Deutsche Bank, the German multinational that was subpoenaed by New York State Attorney General Letitia James, who has requested documents related to the president’s failed purchase of the Buffalo Bills in 2014. These three inquiries represent the president’s most obvious legal exposure after the conclusion of the Mueller report.

A recent report from the New York Times regarding Trump’s long partnership with Deutsche might be the ultimate confirmation of the president’s business ethics. According to documents reviewed by the Times, Trump repeatedly inflated his worth in order to obtain new loans from Deutsche. In 2005, during the second season of the Apprentice, the bank determined he was worth around $788 million, undermining Trump’s claim that he had around $3 billion in assets. Remarkably, Deutsche kept lending to Trump, even after he defaulted on massive loans. Currently, the president owes the German bank around $340 million.

Report: How Donald Trump Inflated His Net Worth to Lenders