New book on Deutsche Bank reveals what we all knew: DB was funneling Russian money to Trump . . . and, Trump is a crook

Emblematic of the bank’s problems has been its relationship with Donald Trump, who by the mid-1990s had stiffed so many lenders over the years as a real estate developer that no other bank would have anything to do with him. An initial loan of $125 million in 1998 to rehabilitate an office building at 40 Wall Street was followed by $900 million more for the GM Building on Fifth Avenue and a tower across from the United Nations. And when Trump was on the verge of defaulting on loans used to buy his failing hotels and casinos in Atlantic City, Deutsche Bank came to the rescue by peddling $484 million in junk bonds to investors — bonds on which Trump defaulted within a year.

Normally, such a default would have been enough to scare away even the most risk-tolerant lenders. But within months, Deutsche Bank’s real estate division was again providing Trump with a $640 million loan needed to build a new Chicago hotel, while its team in Moscow was steering Russian investors to Trump projects in Hawaii and Mexico. The relationship hit a low point in 2009 when Trump announced he had no intention of repaying his loan on the Chicago hotel, claiming that the unfolding financial crisis was an act of God that freed him of his obligation. When Deutsche Bank sued to get its money back, Trump countersued, preposterously accusing the bank of predatory lending practices. The matter was finally settled with a two-year extension on the loan — and a vow by the bank’s real estate lenders never to do business with Trump again. But two years later, Trump somehow sweet-talked his way into Deutsche’s private banking division, which over the next several years provided him with $350 million in personal loans to cover projects in Chicago, Miami and Washington.

 

Whatever financial risks the bank might have had with its marquee client, however, would soon pale compared with the regulatory and reputational risks it took on when Trump won the 2016 election. Even now, the Supreme Court is considering whether the bank must turn over records from its Trump files to the House of Representatives. Trump sued to block the bank from complying with the House subpoena.