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Donald Trump is neck deep in Putin's swamp

Many kinds of money, banknotes and coins

After the Trump-Putin dog and pony show in Helsinki, viewers on all sides are wondering out loud what kompromat, or compromising material, Russian president Vladimir Putin could possible have on U.S. president Donald Trump.

Here's a hint: Donald Trump doesn't care about sex scandals or videos. He has entertained the National Enquirer's readers for decades by constantly cheating on his wife or mistress of the day. The rest of the world probably would be more embarrassed or squeamish about his sex tapes than he would be.  

As polite Canadians, let's be practical and follow the money. Although No. 45 has refused to release his tax returns, Special Counsel Robert Mueller certainly has the power to subpoena them from the IRS, and it would be amazing if he hasn't already done so.

Through raids on their homes and offices, Mueller also has the private records and computer files from two important Trump associates: his personal lawyer and fixer Michael Cohen, and his former campaign manager, Paul Manafort, currently in prison facing charges of fraud, money laundering, and witness-tampering. Between the two, their books should finally answer the question of how much money No. 45 really has.

Let's look at the public record first. Donald Trump has long called himself "the king of debt," because almost all his real estate deals have been made with other people’s money.      

So it’s no surprise that while Forbes and Bloomberg both estimate his commercial empire is worth about $3 billion, they put his personal wealth at much less -- $290 million in 2018, according to Forbes. That's less than 1/10th of his worth on paper.  

While many an empire lives and breathes on credit, most do try to avoid bankruptcy, which is both poor business practice and creates barriers to future loans. Doing things his own way, Trump has been through at least six bankruptcies and has stiffed enough U.S. banks that most of them now decline his loan applications on sight.

When U.S. banks said no, in about 2000, No. 45 relied on loans from the private bank at Deutsche Investment Bank, which (among other items) financed a $640 million mega hotel and casino in Chicago. Then, in November 2008, No. 45 was due to pay a $40 million installment. Instead, he produced his own brief saying he would not repay the loan because the 2008 financial crisis was a "force majeure" ("Act of God”) under the contract, an unforeseen cosmic event.

Therefore, he said, he would not repay the outstanding $337 million. And he hasn't. In an act of sheer chutzpah, he pre-emptively sued Deutsche Bank for $3 billion compensation, alleging they had helped cause the 2008 crash. Somehow, the two parties settled their differences in 2010. And then Deutsche Bank actually lent him money again!

"Deutsche has not explained why it continued to bankroll Trump and his real estate deals," says a Guardian article. "Even before the 2008 legal dispute, Trump’s chequered business record was infamous. Other financial houses in New York refused to give him credit, following a string of failed ventures including an airline and a casino empire in Atlantic City."

Meanwhile, Deustche Bank ran into some challenges. The U.S. and U.K. governments have fined Deustche Bank $630 million for assisting in Russian money laundering US$10 billion in funds. The three parties also settled on a fine of  $7.2 billion for allegedly mis-selling financial products a decade ago.

Given that Trump still owes Deutsche Bank money, it's really awkward that the U.S. Department of Justice is currently investigating Deutsche over the possibility of Russian money laundering. Conflict of interest, anyone?

By 2010, the Trump organization had found another steady source of income and suddenly started buying up golf courses for cash. Golf writer James Dodson told a local radio station about golfing in Scotland with Eric and Don Trump Jr. When he asked where they found the $200 million cash for the Turnberry golf course, Eric replied, "We have all the funding we need, out of Russia." Don Jr. had already said something similar in 2008: "We see a lot of money pouring in from Russia." 

The non-profit Global Witness group points to dozens of all-cash purchases and purchased but unoccupied condos in the Trump Ocean Club International Hotel and Tower in Panama as an example of how real estate deals and money laundering can intersect.  

"Trump relying on funds from Russia is not in itself a problem -- some of these funds are no doubt from legitimate sources," says Global Witness. "What is deeply problematic, however, is the fact that some of this money appears to have come from criminal networks . . . Far from being a victimless crime, money laundering keeps poor countries poor, props up dictatorships and fuels corruption and criminality."

The UN Office on Drugs and Crime estimates global money laundering at about $2 trillion (U.S.) annually. Raised through illegal predatory activities such as loansharking, gambling, prostitution, drug running, theft, extortion, fraud, arson, and human trafficking, "dirty money" has to be funnelled through some kind of legal possession (like real estate) that the owners can sell for clean cash, which they then can spend on the open market.

Law enforcement agencies monitor large financial deposits domestically and internationally in order to track criminal activity. As well, they've found that strategically, it's easier to win a conviction on a tax evasion charge than, say, multiple murders. Just ask Al Capone.

The real estate market offers prime opportunities for money laundering because anonymous shell companies can buy and sell high-ticket items for cash. In Canada, Transparency International says that money laundering has inflated housing prices in Vancouver and Toronto, as shell companies flip empty homes back and forth like the agitator in a washing machine, raising house prices, paying cash, and washing a few more hundred thousand each time.

Mueller's team does seem to be exploring money laundering as a factor in possible collusion between Team Trump and Russian interference in the election. Mueller has also issued indictments for 25 Russian hackers, including the 12 Russian army intelligence officers named in his July 13 indictments for what the New York Times called "a litany of brazen Russian subterfuge operations meant to foment chaos in the months before Election Day."

The Times went on: "From phishing attacks to gain access to Democratic operatives, to money laundering, to attempts to break into state elections boards, the indictment details a vigorous and complex effort by Russia’s top military intelligence service to sabotage the campaign of Mr. Trump’s Democratic rival, Hillary Clinton."

As for proof of No. 45's complicity or conscious collusion with the accused Russian hackers, Mueller's indictment notes that hacking began on July 27, 2016, a few hours after candidate Donald Trump pleaded on national TV, "Russia, if you’re listening, I hope you’re able to find the 30,000 emails that are missing." From then on, Wikileaks (also indicted) fed Democratic emails to the media every few weeks, keeping alive the purported scandal about his opponent’s email security.

No matter who initiated the relationship, says the activist organization Avaaz, "It’s now shockingly clear that Donald Trump is Putin’s poodle." After he discovered that many legitimate banks wouldn’t lend to him anymore, Avaaz says, No. 45 "turned to Russian oligarchs -- Putin’s ruling clique -- to bankroll his projects, and launder their dirty money for them. This was, and continues to be, a huge part of his business. He’s a Russian money launderer."

Money, not kompromat, is likely to be the hold that Russians have on No. 45. Putin is rumoured to be the richest man in the world, with $200 billion -- a factor No. 45 no doubt admires. On the other hand, we have no way of knowing how much of Trump’s estimated $3 billion fortune (on paper) comes from the Russians. Try to imagine how terrifying it would be to be the person who owes Vladimir Putin a million dollars, much less a billion.     

Alongside the heated public debate over whether Trump’s performance at Helsinki constituted treasonous behaviour, another heated legal debate has erupted over whether a sitting president can be indicted for a criminal offense. Legally, a president certainly can be removed from office for treason -- but that doesn't mean it would be possible politically. In my next post, I’ll look at the legal options for removing a corrupt, incompetent or incapacitated president. 

Image: Wikimedia Commons                                                            

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