Yesterday afternoon, the New York Times produced one of the greatest pieces of journalism you’ll ever see. It’s an exhaustive report on President Trump’s finances, based on an analysis of over 100,000 documents “culled from public sources — mortgages and deeds, probate records, financial disclosure reports, regulatory records and civil court files,” as well as “tens of thousands of pages of confidential records — bank statements, financial audits, accounting ledgers, cash disbursement reports, invoices and canceled checks,” including over 200 tax returns from his father, Fred Trump. To say the Times brought the receipts to this inevitable fight is an understatement.
The report paints an incredibly damning picture of Trump, as it proves that his fortune was not self-made—as the president has spent a lifetime asserting—but it came directly from his father in a litany of sketchy ways. Plus, the famed “$1 million loan” from Fred Trump was found to be at least $60.7 million, and there’s questions about whether Trump ever paid it back. The Times revealed that Trump was “making” $200,000 per year by the time he was three years old, and he was a millionaire by age eight. The report is impeccably detailed, and I encourage you to take an hour out of your day to read the whole thing, but here are five excerpts you need to know.
But The Times’s investigation, based on a vast trove of confidential tax returns and financial records, reveals that Mr. Trump received the equivalent today of at least $413 million from his father’s real estate empire, starting when he was a toddler and continuing to this day.
Much of this money came to Mr. Trump because he helped his parents dodge taxes. He and his siblings set up a sham corporation to disguise millions of dollars in gifts from their parents, records and interviews show. Records indicate that Mr. Trump helped his father take improper tax deductions worth millions more. He also helped formulate a strategy to undervalue his parents’ real estate holdings by hundreds of millions of dollars on tax returns, sharply reducing the tax bill when those properties were transferred to him and his siblings.
The most overt fraud was All County Building Supply & Maintenance, a company formed by the Trump family in 1992. All County’s ostensible purpose was to be the purchasing agent for Fred Trump’s buildings, buying everything from boilers to cleaning supplies. It did no such thing, records and interviews show. Instead All County siphoned millions of dollars from Fred Trump’s empire by simply marking up purchases already made by his employees. Those millions, effectively untaxed gifts, then flowed to All County’s owners — Donald Trump, his siblings and a cousin. Fred Trump then used the padded All County receipts to justify bigger rent increases for thousands of tenants.
Before he turned 20, Fred Trump had already built and sold his first home. At age 35, he was building hundreds of houses a year in Brooklyn and Queens. By 45, he was building some of the biggest apartment complexes in the country.
Aside from an astonishing work ethic — “Sleeping is a waste of time,” he liked to say — the growth reflected his shrewd application of mass-production techniques. The Brooklyn Daily Eagle called him “the Henry Ford of the home-building industry.” He would erect scaffolding a city block long so his masons, sometimes working a second shift under floodlights, could throw up a dozen rowhouses in a week. They sold for about $115,000 in today’s dollars.
In the chauffeured Cadillac, Donald Trump took The Times’s reporter on a tour of what he called his “jobs.” He told her about the Manhattan hotel he planned to convert into a Grand Hyatt (his father guaranteed the construction loan), and the Hudson River railroad yards he planned to develop (the rights were purchased by his father’s company). He showed her “our philanthropic endeavor,” the high-rise for the elderly in East Orange (bankrolled by his father), and an apartment complex on Staten Island (owned by his father), and their “flagship,” Trump Village, in Brooklyn (owned by his father), and finally Beach Haven Apartments (owned by his father). Even the Cadillac was leased by his father.
“So far,” he boasted, “I’ve never made a bad deal.”
Yet for all the spin about cutting his own path in Manhattan, Donald Trump was increasingly dependent on his father. Weeks after The Times’s profile ran, Fred Trump set up still more trusts for his children, seeding each with today’s equivalent of $4.3 million. Even into the early 1980s, when he was already proclaiming himself one of America’s richest men, Donald Trump remained on his father’s payroll, drawing an annual salary of $260,000 in today’s dollars.
The document, known as a codicil, did many things. It protected Donald Trump’s portion of the inheritance from his creditors and from his impending divorce settlement with his first wife, Ivana Trump. It strengthened provisions in the existing will making him the sole executor of his father’s estate. But more than any of the particulars, it was the entirety of the codicil and its presentation as a fait accompli that alarmed Fred Trump, the depositions show. He confided to family members that he viewed the codicil as an attempt to go behind his back and give his son total control over his affairs. He said he feared that it could let Donald Trump denude his empire, even using it as collateral to rescue his failing businesses. (It was, in fact, the very month of the $3.5 million casino rescue.)
As close as they were — or perhaps because they were so close — Fred Trump did not immediately confront his son. Instead he turned to his daughter Maryanne Trump Barry, then a federal judge whom he often consulted on legal matters. “This doesn’t pass the smell test,” he told her, she recalled during her deposition. When Judge Barry read the codicil, she reached the same conclusion. “Donald was in precarious financial straits by his own admission,” she said, “and Dad was very concerned as a man who worked hard for his money and never wanted any of it to leave the family.” (In a brief telephone interview, Judge Barry declined to comment.)
Fred Trump took prompt action to thwart his son. He dispatched his daughter to find new estate lawyers. One of them took notes on the instructions she passed on from her father: “Protect assets from DJT, Donald’s creditors.” The lawyers quickly drafted a new codicil stripping Donald Trump of sole control over his father’s estate. Fred Trump signed it immediately.
President Trump is a fraud. Literally. We can say this because the New York Times certainly cleared using that specific criminal term with a litany of lawyers. If what was described in the exhaustive report was not fraud, then the NYT would torpedo their credibility and would likely be sued into oblivion. Fred Trump was very much a self-made man—if you ignore the fact that his entire real estate empire was made possible by the United States federal government giving him cheap loans. The irony of him spending the majority of his life figuring out ways to circumvent paying taxes while passing his fortune down to his children is a fitting tale for our times.
This report is so solid that the New York state tax department is reviewing the fraud allegations by The Times. It will be difficult to nail Trump on any potential criminal activity detailed by the New York Times, given that the statute of limitations has expired—however, civil litigation does not, and the infuriatingly and transparently corrupt “business” of All County Building Supply & Maintenance sure looks like a massive liability. Lord knows how many people were paying higher rents for who knows how long—solely because of a scheme perpetrated by Fred Trump to funnel his fortune into Donald Trump and his siblings’ pockets. The President of the United States is a literal fraud, and thanks to the intrepid reporting that took over a year for David Barstow, Susanne Craig, Russ Buettner and their editors at the NYT to complete, now we have the documentation to prove it.
Jacob Weindling is a staff writer for Paste politics. Follow him on Twitter at @Jakeweindling.