Trump hid more than $ 70 million in losses at DC hotel, House panel says
5th President of the United States Donald Trump holds a press conference at the Trump National Golf Club in Bedminster, New Jersey, the United States, July 7, 2021.
Tayfun Coskun | Anadolu Agency | Getty Images
WASHINGTON – Former President Donald Trump’s luxury hotel in Washington, DC lost more than $ 70 million from 2016 to 2020, according to recently released confidential documents his accountants submitted to the hotel owner, the General Services Administration.
While the hotel was losing money, Trump’s annual financial information filed with the Office of Government Ethics only publicly reported on the hotel’s revenues, which totaled nearly $ 156.6 million.
Yet during the same period, Trump’s accounting firm, WeiserMazars LLP, disclosed in confidential reports to GSA that the hotel lost almost $ 73.9 million.
According to a new report released Friday by the House Oversight and Government Reform Committee, the effect of the gap between what Trump has reported publicly and what he has disclosed privately has been to mislead the public about the president’s financial position.
A Trump spokesperson did not immediately respond to a request for comment on CNBC’s new report on Friday.
The committee also alleges that Trump hid more than $ 20 million in loans his real estate holding company made to the ailing hotel, another attempt to cover up the president’s true state of finances.
“Far from being a successful investment, the Trump Hotel was a failing company burdened with debt that required bailouts from President Trump’s other companies,” the committee said. written in a letter Friday to Robin Carnahan, administrator of the General Services Administration, the federal agency that holds the lease for the underlying property of the Trump’s DC hotel, the historic Old Post Office Building on Pennsylvania Avenue.
The Trump International Hotel in Washington, DC
Adam Jeffery | CNBC
“In deciding to hide the true financial situation of the Trump Hotel from federal ethics officials and the American public, President Trump has concealed conflicts of interest,” wrote Representative Carolyn Maloney, DN.Y., and Representative Gerry Connelly, D-Va., respectively the Chairman of the Committee and the Chairman of the Government Operations Subcommittee.
It is not clear whether Trump broke federal rules regarding the disclosure of assets and income. By reporting the income and omitting the losses, Trump appears to have followed the letter of the law, if not the spirit.
The committee also revealed that Trump received an unreported and surprising loan modification from Deutsche Bank midway through his presidency, a modification that potentially saved the then president tens of millions of dollars. and his struggling business.
Deutsche Bank’s U.S. subsidiary loaned Trump $ 170 million in 2015 to finance the hotel’s renovation and operation. Under this loan, Trump was supposed to start repaying the principal in 2018.
But according to the committee’s findings, in 2018, “the loan terms were changed to allow the Trump Hotel to defer any principal payment on the loan for six years.”
It is not clear, the committee said, how the loan modification was negotiated, or by whom. The change in loan terms was never publicly disclosed, according to Trump’s annual financial information.
A spokesperson for Deutsche Bank did not immediately respond to questions from CNBC on Friday about the change in loan terms and whether steps were taken at the time to avoid the appearance of a preferential treatment given to the president.
The new findings are in line with Trump’s decades-long trend of inflating his income, assets, and net worth, while hiding his losses and debts.
This pattern is currently under investigation by authorities in New York State, who are investigating whether Trump’s company inflated the value of its properties on insurance forms and dumped them. in tax returns. This could constitute insurance fraud.
The company is also facing a New York tax evasion case that has already entangled its chief accountant, longtime Trump family employee Allen Weisselberg. In July, Weisselberg pleaded not guilty to a slew of charges stemming from an alleged decades-old plot to hide the compensation he received from the company.
Trump has denied any allegations of wrongdoing, instead accusing authorities of subjecting him to a partisan “witch hunt.”
Trump was recently Removed from Forbes magazine’s list of the 400 richest Americans, a list he had been on for 25 years. The Covid-19 pandemic has hit the commercial real estate and hospitality sectors particularly hard, costing Trump an estimated $ 600 million in estimated net worth, Forbes determined.